Fisheries

PNG is seeking to reach a major milestone on its journey to becoming a regional fish processing powerhouse.

The plans for Papua New Guinea’s fishing industry are ambitious. The Prime Minister Peter O’neill is on record saying his government’s aim is for the industry to become the largest tuna processing and canning hub in the region, ahead of Thailand and the Philippines.

Although there is a long way to go before that is achieved, there are positive signs. Alan Mclay, President of the Lae Chamber of Commerce, describes Lae’s established fish canneries as ‘the shining light, especially the tuna canneries relying on stock from Morobe waters.’ Mclay says a new cannery will be built soon, which, he says, shows ‘the strength of this industry’.

Another initiative is the proposed establishment of a Pacific Marine Industrial Zone project in Madang Province. It is to have up to 10 tuna canneries and other port facilities, located on the Madang Lagoon.

The project has faced delays and cost increases, however. According to the EXIM Bank of China, which is a 78 per cent partner, the budget has increased by US$61 million (K194 million) on top of the original US$95 million (K300 million) secured under phase one.

The area will encompass 100 hectares for the industrial zone and 115 hectares for residential and commercial use. Anton Yagama, Vice Minister in charge of the project, hopes operations will begin in the first half of 2017.

Local manufacturing

Pete Celso, the Managing Director of the country’s biggest cannery, the Philippine-owned R D Tuna Canners, and chairman of the Fishing Industry Association (PNG), is positive about the project but says ‘the biggest challenge is to make it happen’.

A 2017 report by the Fishing Industry Association found that PNG in 2012–2013 exported more tuna than it imported. The report pointed to an alleged lack of border control.

‘We have more than enough local manufacturers and canneries to supply the needs of the entire nation with surpluses,’ says Celso. ‘Here you are trying to encourage local producers to do it and yet we simply don’t have much control on all these imported items whose guidelines are a bit different from the local producers.

‘ To me it doesn’t make any sense because most of the tuna that comes back was the same tuna that was caught in PNG waters. But foreign canners can produce it much cheaper because the cost of doing business is not only lower overseas, their respective governments have built incentives which we don’t have here.’

Celso points to other issues facing the industry. One is the lack of foreign exchange. Another is the rising cost of doing business. Maintaining market access is a further challenge.

‘We used to be getting almost exclusive duty free access to Europe, but Europe is now trying to give the same benefit to a good number of countries whose cost of doing business is much lower.’ 

ALAN MCLAY, PRESIDENT OF THE LAE CHAMBER OF COMMERCE, DESCRIBES LAE’S ESTABLISHED FISH CANNERIES AS ‘THE SHINING LIGHT’.