28 Oct 05 - Statement by Minister for Fisheries, Hon. Ben Semri, MP on the occasion of the dividend payment for 2005 to the National Government

Ministry of Fisheries

Statement by Minister for Fisheries, Hon. Ben Semri, MP on the occasion of the dividend payment for 2005 to the National Government

28th October 2005

Rt. Hon. Grand Chief. Sir Michael Somare, Prime Minister
Hon. Bart Philemon, MP- Minister for Finance and Treasury
Hon. Authur Somare, MP-Minister for Planning
Mr. Bamake Rumbam, National Fisheries Board Chairman and Members
Mr. Valentine Kambori, Secretary for Planning and Rural Development
Mr. Simon Tosali- Acting Secretary for Treasury
Mr. Thaddeus Kambanei, Secretary for Finance
Mr. Sylvester Pokajam-Acting Managing Director for NFA
Senior officers of NFA and other Government Departments
Members of the Press
Ladies and Gentlemen:


On behalf of the Board and Management of the National Fisheries Authority I am pleased to announce that the National Fisheries Authority will be making a dividend payment of K30million for the year 2005 to the National Government. This payment signifies a million kina for every year since Independence 30years ago. The total amount of dividend payments made by the National Fisheries Authority since its restructure in 2001 to the Government of PNG amounts to a total of K141 million.

The National Fisheries Authority makes over ninety percent of its revenue from bilateral fishing access agreements. The bilateral access arrangements are entered into with purse seine fishing fleets from China, Korea, Taiwan and the Philippines, as well as interim agreements with locally based foreign vessels and under the US Multilateral Treaty and the FSM Arrangement.

As Minister responsible for fisheries, I am mindful of the need to maintain a balance between having access agreements and encouraging onshore investments under the Somare Government’s Export Driven Economic Growth and Recovery Strategy. I believe we have maintained this balance successfully to the benefit of Papua New Guinea. The first tuna cannery in PNG opened in Madang in 1997. In 2003 a tuna loining plant was established in Wewak. Later this year another tuna cannery will be in operation in Lae. Agreements are also in place for the establishment of a tuna loining plant in Kokopo, Lae and Wewak. The current tuna processing capacity is about 330 metric tons per day. With the expansion of the existing plants together with the new ones coming into operation the processing capacity can easily go over 1,310 metric tons per day. Aside from processing, a ground breaking ceremony for a dockyard and cold storage facility took place last week in Vanimo and next month a net mending and servicing facility will be opened for business in Lombrum.

Benefits from onshore investments in time will far outweigh those under access agreements except that under the latter NFA is able to derive revenue for its budget with surplus paid as dividend to the National Government.

PNG’s drive towards developing its domestic fishing industry is also dependent on the fisheries management and conservation regimes in the Pacific region – as tuna as we know is a highly migratory fish species, some have argued that it must be managed in entirety.

Given the limited scope provided under these management arrangements, the onus is upon us to choose genuine partners who are able to contribute towards meaningful onshore investments. It is also an opportune time for me to thank the existing players in the industry for their contribution. I would also like to remind them to fish within the terms of their respective agreements and ensure to comply with the licensing conditions.

The landscape for the tuna fishery is one that has continued to change over the years with the establishment of the Western Central Pacific Tuna Commission last year and the changes to the Palau Arrangement.

Within the region PNG has officially signed on earlier this month to adopt the Vessel Day Scheme, a new management tool under the Palau Arrangement which shifts the management of purse seine capacity from vessel numbers totaling 205 vessels to fishing days. Under the Vessel Day Scheme PNG has been allocated a total of 7,000 plus days. This effectively means that as the number of domestic investment increase, more and more vessel days will be allocated to the vessels associated with these investments and lesser number of vessel days will be available for bilateral fishing access agreements. As a result the direct revenue to NFA from access fees will reduce and so is the dividend payment to the National Government.

While there has been investments in the larger tuna purse seine fishing sector the other fisheries sectors such as the tuna longline fishing and prawn trawling sectors have been hard hit by the rising operational costs which are largely associated with the rise in fuel and freight costs.

Many of the tuna longline vessels and the prawn trawlers are now anchored at ports in Lae and Port Moresby and their crew sent home.

As Minister responsible I have already tasked the National Fisheries Authority to assess the plight of these two fishery sectors and explore reasonable avenues to assist them. We need to review the studies that have been conducted recently to assess the impact on the tuna longline fishing and prawn trawling sectors and put in place remedial policy measures to safeguard these sectors.

I want again call on the Minister for Finance and Treasury and the Minister for National Planning and their Departments to support and ensure the creation of a dedicated fisheries loan scheme in the first quarter of 2006. It would be good to see part of the dividend payment from the fisheries sector ploughed back under loan arrangement into the sector to assist the domestic fishing industry, which is currently struggling.

While we are encouraging the larger tuna purse seine players to come onshore and develop their processing and servicing facilities; we have to be also mindful of our responsibility to the small to medium fishing operators.

To conclude, as Minister responsible for fisheries I am pleased to handover the dividend payment of K30 million to the National Government through the Prime Minister, Rt. Hon. Grand Chief Michael Somare.

Thank you,