Poultry debate

FIJI’s three major poultry producing companies are not affected by the reduction in duty for imported chicken portions because the poultry industry is still one of the most heavily protected industries.

This is according to Deputy Prime Minister and Finance Minister Professor Biman Prasad while answering questions on impact of the reduction of duty from 10 per cent to zero per cent on imported chicken portions on the local poultry industry in Parliament on Tuesday.

He said because of it being heavily protected, ‘we are almost self-sufficient. However, self-sufficiency and the support for local industries must be carefully balanced with the cost to our people”.

“What we found out, when we were doing the budget, even with the 42 per cent duty, some of the importers of chicken portions, chicken wings, chicken drumstick were still able to sell in the local market at a lower price than our local producers and that to me was in some sense unethical,” Mr Prasad said.

“The other thing that we have in this country is that we are only importing chicken from New Zealand. If we import chicken from Indonesia, for example, Indonesia has quality chicken, Japan imports, from the gures that I saw, about 40 per cent of chickens from Indonesia.

“If we allow import of chicken from Indonesia, we will probably end up landing the chicken here with 42 per cent duty and still selling those chickens at a much lower price than what our local producers sell.”

He said even with the reduction of duty on imported chicken portions from 10 to zero per cent, the scal duty of 32 per cent still remains.

“So, even if someone who is importing chicken portions today, that importer still pays 32 per cent instead of the original 42 per cent. A total tariff protection of 42 per cent is still applicable for anything which includes whole chicken other than chicken portions.

“When we put those very high duty, the cost, even if there was zero VAT, if you raise the duty, it is a tax on the consumers. The people who import, Mr. Speaker, Sir, they do not pay for those taxes. All they do is simply pass it onto the consumers.

“The signal that we provided in the budget, was to say to the local producers, ‘Look at your pricing, look at your efficiency. Do not just concentrate on making an exorbitant pro t at a cost of the prices to the consumers.”

Mr Prasad said the three companies employ around 2,400 people.