NEWSPAGE 14 December
2009

(Photos: MoneyPACIFIC / Smokefree Oceania)

NEW ZEALAND: A new Pacific approach to financial awareness

(Photo: Samoa Government)

SAMOA: Parliamentary Updates
Source: Government Press Secretariat Press Release

Prime Minister to attend Climate Change Meeting in Copenhagen

Prime Minister Tuilaepa Sailele Malielegaoi has left the country for the 15th United Nations Climate Change Conference (COP15) in Copenhagen, Denmark on the 16 - 18 December 2009.

The Prime Minister will meet with Chancellor Merkel of Germany on the 13 - 15 of December before continuing on to Denmark.

World leaders will meet in Copenhagen to agree on ways to decrease the climate change process and how to overcome problems created by this process.

Foreign Affairs CEO Aiono Mose Pouvi Sua is accompanying the Prime Minister.


Report on Western Pacific Region-WHO meeting

Cabinet has approved the report on the Western Pacific Region of the World Health Organization meeting that was held in Hong Kong, China from 21 -25 Seprtember 2009.

The meeting was a good opportunity for Samoa to raise its concerns about some of the matters discussed and monitoring ways to enhance public health services in Samoa.

Prioritizing the prevention of non communicable diseases and promoting healthy eating as dictates in the Public Health Innovation and Intellectual Property Rights in Health (TRIPS).

The Ministry of Health’s role in maintaining and providing quality service was also made known at the meeting.

Minister of Health Gatoloaifaana Amataga Alesana Gidlow lead Samoa’s delegation with CEO Palanitina Tupuimatagi Toelupe and ACEO Sarah Faletoese Su’a.


Report on WAIPA meeting

Cabinet has approved the report on the World Association of Investment Promotion Agencies (WAIPA) meeting that was held in Milan, Italy on 12 -14 October 2009.

Discussed were the WAIPA statutes and the role of offices responsible for the promoting of countries to foreign investors, and also matters relate to the drop in numbers of foreign direct investment due to the global financial crisis.

The organization’s financial statement for 2008 was also approved at the meeting.

Also reviewed were subscriptions by each country, where Samoa will pay a subscription of USD$2,500. The change means big countries will pay more compared to the USD$2,000 subs that all member countries paid since WAIPA was established in 1995.

Its important for Samoa to remain a member of WAIPA because of its role in the WTO. This will benefit Samoa especially our drive to attract foreign investors.


Report on Samoa accession to the WTO

Cabinet has approved the report on Samoa accession to the World Trade Organisation meeting which was held in Geneva on 27 - 30 October 2009.

Accessed at the meeting were Samoa’s liquor license issue, VAGST for farmers in Samoa, ban on turkey tails importation into Samoa, ban the importation of vehicles manufactured over 12 years, Samoa’s policies on Intellectual Property Rights and Customs valuation.

Samoa’s delegation also held meetings with partner countries like Japan, Ukraine, America and countries of the European Union.

Some matters should be put forward for approval by the WTO at the end of February 2010 which include Liquor License Act, review of tax policies for small businesses, Trade-Related Aspects of Intellectual Property Rights (TRIPS) and finalizing partnerships with other WTO countries.


Report on Commonwealth Heads of Government Meeting

Cabinet has approved the report on the Commonwealth Heads of Government Meeting in Trinidad Tobago, attended by Prime Minister, Susuga Tuilaepa Sailele Malielegaoi on 27 - 29 November 2009.

The meeting was officially opened by the Head of the Commonwealth, Her Majesty Queen Elizabeth II. This meeting also marks 60 years since the Commonwealth was established.

The main focus of the meeting is for leaders of Commonwealth countries to have one voice to present to the Copenhagen meeting. Leaders agreed on the importance for countries of the world to work together in seeking cures to slower the impacts of climate change.

Assistance for small island nations including Samoa was also emphasized at the meeting because of their vulnerable positions to the impacts of climate change and sea level rise, although small countries contribute only a small amount of gas emission which has polluted the environment.

Commonwealth leaders also agreed to establish a Copenhagen Launch Fund 2010 to help developing nations’ climate change adaptation projects.

Parkistan was welcomed back into the Commonwealth during the meeting. Rwanda, was also accepted to become a member. But Commonwealth leaders were saddened with Fiji’s political status, and prohibit Fiji from any Commonwealth meeting as of 1st September 2009.

Discussion expanded on to the decreasing of dangerous weapons especially nuclear weapons as certified by Samoa in 2008, and also terrorism and guns.

International agreements such as Arms Trade Treaty, people smuggling and trafficking, health and HIV/AIDS, the importance of communication and technology were also addressed.

The next meeting will be held in Australia in 2011.

Samoa’s delegation spent one night in Honolulu upon returning from the meeting and were presented with a USD$2,100 from the Samoa community there to assist with tsunami victims.
 

(Photo: Australian Government)

AUSTRALIA: Australian Government Support for Gas Project in PNG
Source: Australian Government Press Release

Trade Minister Simon Crean today announced that the Australian Government has offered a loan of up to USD 500 million (AUD 547 million) to support Australian participation in the development of the world-scale Liquefied Natural Gas project in Papua New Guinea.

"The ExxonMobil project is vital to PNG’s economic well-being, potentially putting PNG on a more sustainable economic growth path," Mr Crean said.

"This project will provide a boost to PNG, the region and Australia."

"It is estimated 12,000 skilled and unskilled workers will be required for the PNG gas project."

"Australian exporters have already been identified as the preferred tenderers for USD 1.2 billion (AUD 1.3 billion) of contracts. With the announcement of the project going ahead there is up to USD 3 billion (AUD 3.3 billion) of project-related contracts potentially available for Australian exporters."

"LNG is increasingly in demand as the requirement for cleaner sources of energy grows."

"Beyond Australia’s competitive advantage and expertise in this field, the PNG development could enhance the significance of our region as a reliable global supplier of energy."

"In this regard the Australian Government, with the PNG Government, is focussed on ensuring that the project lives up to its potential, and benefits all regions and people of PNG."

"I have agreed a Joint Understanding with the PNG Government on effective and transparent governance of the LNG project revenue."

"The Joint Understanding sets out the PNG plans to develop a Fund based on the Australia Future Fund model with Australian assistance.

"We intend to work with the PNG Government to monitor the implementation of the Joint Understanding very carefully."

Australian companies Oil Search and Santos hold over 40 per cent equity in the project. The loan of up USD 500 million is to be provided to the project sponsors through Australia’s Export Finance and Insurance Corporation.

USD 100 million (AUD 109 million) is being offered on EFIC’s commercial account and USD 400 million (AUD 438 million) on the National Interest Account.

In addition to Australia’s EFIC, debt financing for the project is being provided largely by export credit agencies, including from the United States, Japan, China and Italy.

The project is a world-scale vertically integrated upstream natural gas and liquefied gas development led by ExxonMobil Corporation. Phase One of the project has an estimated value of USD 18.3 billion (AUD 20 billion). Export production is expected to commence in 2014.

The text of the Joint Understanding can be found at: http://www.dfat.gov.au/geo/png/png_lng_091208.html

Photo Caption: Minister for Trade Simon Crean.
 

(Photo: The National)

PAPUA NEW GUINEA: Kongo Coffee eyes increased output
Source: The National

Nationally-owned coffee exporting and roasting company Kongo Coffee expects to produce eight tonnes of export-quality green beans per hour early next year.

The increase will be four tonnes more than its current capacity of two, thanks to the K6.6 million grants from the National Development Bank (NDB).

The funding will see Kongo expand its coffee processing factory in Chuave, Simbu province.

NDB managing director Richard Maru said the K6.6 million given to Kongo Coffee came from the K20 million in the national agriculture development plan (NADP) of the National Government.

“We are happy to support Kongo Coffee - the largest locally-owned coffee exporting company in the country - which has proven over the years to be the best and rated No. 1,” Mr Maru said.

He noted that most of the country’s coffee beans were processed by foreign-owned entities.

Mr Maru said helping Kongo Coffee, which in turn helps growers, was consistent with the Government Vision 2050 of helping people improve their incomes.

The NDB team led by Mr Maru visited the factory last week.

Kongo Coffee owner Jerry Kapka told Mr Maru’s group that due to an increase in the volume of coffee being delivered to the factory, they have been encouraged to expand the facility.

Mr Kapka said it was difficult to secure needed financial backup for expansion and that he was grateful to NDB’s support.

Construction work at a new factory, which will house three separate green bean processing plants, is nearing completion.

Mr Kapka said once completed, they would be able to process six tonnes of green beans in an hour, thus complementing the present factory of two-tonne capacity.

Photo Caption: NDB managing director Richard Maru during his visit to the Kongo Coffee factory.
 

SOLOMON ISLANDS: Government commended on work to end violence against women
Source: Solomon Times

Australia commends the Solomon Islands Government for their commitment to addressing violence against women in Solomon Islands.

Deputy Prime Minister Fred Fono on Thursday launched the Solomon Islands Family Health and Safety Study, a Study on Violence Against Women and Children.

The report provides strong evidence and a comprehensive set of recommendations to help the Solomon Islands Government respond to violence against women.

"Violence is a serious issue, affecting the lives of women around the world, including in Australia. It limits women's ability to fully participate in society, and negatively affects their families and communities," Kamal Azmi, Counsellor Development Cooperation, Australian High Commission said.

Australia has a policy of zero tolerance for violence against women. The Australian Government is committed to tackling this issue in Australia, by developing a National Plan to Reduce Violence against Women, as well as helping our region and the rest of the world.

The study was conducted by the Solomon Islands Ministry of Women, Youth and Children Affairs with the National Statistics Office. The research was undertaken with the support of the Secretariat of the Pacific Community, and funding from the United Nations Population Fund and Australia.
 

(Photo: ESCAP Pacific Operations)

WORLDWIDE: GEC won’t stop Tuvaluan children from playing kilikiti
Source: United Nations Development Programme Press Release

Nowadays children in Nanumaga Atoll are happier than those who lived 10 years ago. Tupua is a 12-year old boy who lives in Tokelau Village, the only village in Nanumaga Atoll, Tuvalu. He and his friends have a regular favorite activity every Saturday night: playing kilikiti. Kilikiti is a Tuvaluan version of cricket which can be pretty much enjoyed by all villagers from children to adults. While children who grew up 10 years ago could only play kilikiti during the daytime it is now possible for Tupua and his friends to play in the evening. This is because Tokelau Village has electricity that enables Tupua and his friends to play kilikiti under floodlights in front of his yard in the evening.

The electricity supply was installed as part of the outer island electrification project where the funding came from the Tuvalu Trust Fund (TTF) profit distribution through the National Budget. The good performance of the TTF between 1999 and 2001 enabled the government to spend AUD $1 million for the Electrification of Outer-Islands project as part of its national development programme. TTF was established in 1987 with the purpose to provide an additional source of revenue for recurrent expenses and capital investment of the Government of Tuvalu. The revenue from TTF assists the Government in many ways such as in the maintenance and improvement of existing levels of social infrastructure and services.

Since its establishment, TTF has been a huge success and has been a role model for similar trust funds in other least developed countries. Based on the Tuvalu Trust Fund Twentieth Anniversary Report published in 2007, initial capital contributions to the Fund amounted to AUD $27.1 million; with additional contributions from both development partners and the government of Tuvalu itself this had grown to AUD $64.8 million in June 2007. At that date the market value of TTF was AUD $106.6 million. With an average real rate of return of 6.2 % per annum, the Fund had also provided AUD $65.7 million in revenue to Tuvalu.

According to David Abbott, the Macroeconomic and Poverty Reduction Specialist from the United Nations Development Program (UNDP) Pacific Centre, TTF was able to achieve this performance because the Fund had been invested in a balanced portfolio of asset classes including, international equities, a property fund, a hedge fund and fixed interest securities. The Investment Strategy of the Fund requires that over the long-term the objective is to achieve a real rate of return equivalent to at least 4.5% per annum. “Funds invested are managed by best-in-class fund managers whose performance against benchmarks is monitored on a quarterly base by the Fund Monitor; managers who consistently fail to achieve returns at least to the benchmark may be replaced by managers with better levels of performance” he added.

However, the end of 2007 gave a different sign. The collapse of the financial system in the United States (US) in summer 2007 has affected the global financial system resulting in the Global Economic Crisis (GEC). The fall in global stock markets also affected TTF revenue. TTF invested a good share of its capital in stock markets. As global stock markets declined, the market value of TTF also dropped. According to a recent report of ADB, at the end of March 2009, the value of TTF was about 25% below the real maintained value (the capital contributions adjusted for inflation). This has resulted in the absence of a distribution from TTF to the national budget for 2009 and Government does not expect any distribution in the next two to three years. Without the contribution of TTF to the national budget, fewer development projects are likely to be funded by the government which therefore will have to rely more on development partners for projects finance. Most development projects will be funded by foreign donors, mainly industrialized countries namely Japan, Australia and New Zealand. However donor countries like Australia and New Zealand have also been affected by the GEC and therefore might cut their foreign aid. Fortunately, through prudent management of the earlier distributions, the government has been able to build a small reserve fund which will still be able to make some contribution to the budget until the main Trust Fund is able once again to make a direct distribution to the budget.

The most recent forecasts suggest that the global economy will have recovered by the second half of 2010. However financial conditions at the moment are still far from normal and are highly vulnerable. According to David Abbott the TTF might only return to positive territory by the end of the 2012 financial year. This means the government of Tuvalu will be unlikely to allocate new funding for any development projects in Tupua’s village in the near future. Tupua is still able to play kilikiti every Saturday night with his friends but no other stimulating stories on development from his village will be heard for a while until the global economy is back to normal.

Photo Caption: Nanumaga Atoll, Tuvalu.