After 50 years of being rent collectors of our fisheries resources, Papua New Guinea (PNG) will finally have its own cannery which will be constructed starting this year, says the Minister for International Trade and Investment Richard Maru.
“This new cannery will be developed under a new joint venture (JV) company which will be 50% owned by the State and 50% by RD, with initial expertise to be provided by RD to help us transition from being a rent collector to being an owner of initially a cannery and later a fishing company,” said Minister Maru.
Out of its 50% equity in the JV, the Kumul Consolidated Holdings Limited (KCHL) will reallocate 5% equity to Madang provincial government and 2.5% equity each to the Madang DDA and Sumkar DDA.
The Chairman of RD Group, Mr. Roy Rivera, and his management team have arrived from their Headquarters in the Philippines for the signing of the Memorandum of Understanding (MOU) between RD, the State and KCHL for the development of a state-of-the-art cannery with processing capacity of 300-metric tons per day in Madang.
Minister Maru said this will be the first time that PNG will own a cannery and it is estimated that the construction of the cannery itself will cost K160 million.
“This will be jointly funded by RD and the KCHL who will hold the shares on behalf of the State. Each party will provide K80 million each. The new cannery will be owned and operated by a new fishing company which will be called “Kumul Fisheries Limited” under a joint venture between RD and the KCHL.
Kumul Fisheries Limited will have its own brand and will market its products globally under the new brand. The Board of this new company will have members from both PNG and RD. The management will initially be from RD, but over the next five years, all the positions will be localized.
It is planned that after the signing of the MOU on Friday next week and the endorsement of the design of the new cannery, a new Shareholder Agreement will be signed between the State and RD for the construction to start immediately,” Minister Maru said.
He added that the tender documents for the construction of the new cannery will be ready after the signing of the MOU.
“The construction will take up to 18 months. About 500 people will be employed during the construction phase and over 5,000 will be employed once the cannery is completed and is in operation.
The immediate task of the new cannery is to assist the country to replace all canned fish imports by producing enough canned fish in our cannery to supply the local market. Although PNG catches between 600-700 metric tons of fish every year, 80% leaves the country to be processed offshore because we do not have processing facilities.
As a result, PNG is still importing canned fish from all over the world. It is ridiculous that we export 35,000 tons of canned tuna and import 40,000 tons, and we are losing up to 100,000 jobs and over K4 billion in revenue by not processing all our fish in PNG. We are waiting for the National Fisheries Authority (NFA) to come up with the new Domestication Policy so over the next five years we will process 100% of our catch in PNG
The building of this new cannery in Madang is the start of a deliberate attempt by our government to invest in downstream processing so we can replace all canned fish imports from other countries. This cannery is the anchor investment needed for the proposed Madang Integrated Special Economic Zone (SEZ). This is a very exciting development, and we all look forward to the signing of the MOU next Friday,” added Minister Maru.
Chairman Rivera said he is emotional and excited for this project.
“My Late father built the first cannery in Madang 29 years ago, and as his son who succeeded him as the Chairman of the RD Group, I now have the privilege to build the second cannery, but this time in partnership with the PNG Government,” he said.
Governor for Madang Ramsey Pariwa, had also been very supportive and excited about this project.
“We, the people of Madang, have waited so long for the PMIZ project to eventuate. It is finally happening after 15 years of wait. I want to thank RD Group for willing to partner in this new cannery venture in Madang,” Governor Pariwa said.
Meanwhile, the Department of International Trade and Investment will be putting out a notice next week for Expression of Interest from the private sector to build a new international wharf and also power and water supply, and sewerage in the proposed Madang Integrated SEZ under a Build-Own-Operate-Transfer model.
1 Comment
Pingback: dlvr.it