_________________________________________________________________
Holiday
Inn Fri. 5th
April, 2013
SUVA 1000
Hours
______________________________________________________________________________________
The
Minister for Public Enterprises;
Permanent
Secretaries;
Distinguished
Guests;
Ladies
and Gentlemen.
Bula
vinaka and a very good morning to you all.
I’m
very pleased to be here to present the first licenses for Grades 3 to
5 Fijian Mahogany.
Today,
we are celebrating both an ending and a beginning. The granting of
these licenses marks one of the final steps of the first phase of my
Government’s reform of the Mahogany industry.
It
also represents the beginning of a new era, marked not by corruption
and mismanagement, but by integrity, sustainability and
profitability.
We
all know that the Mahogany Industry desperately needed reform.
In
my address at the inaugural meeting of the Mahogany Industry Council
in November, I said that what existed could barely be described as an
industry at all. There was much talk of reform, but little action to
implement it.
The
so-called industry was broken. Yes, corruption was rife – in the
forest, in the sawmill and in the office.
But
it was more than that.
There
was mismanagement, inefficiency, lack of knowledge and
accountability, and antiquated and outmoded systems.
There
was no long term vision – no organised programme for reforestation.
There
was no real objective to add value to the resource or to adopt modern
practices and management.
There
was no attempt to develop a Fijian brand, even though we are blessed
with the largest mahogany plantation in the world.
Put
another way, there was an overall lack of willingness to make a
paradigm shift.
The
result? Mahogany did not come close to reaching its potential to
provide long-term, sustained benefits for our people.
As
many of you are aware, the majority of our mahogany – including
sawn timber – was exported in a very rudimentary form. In the
international market, we weren’t known for the quality of our
product and so we weren’t achieving premium prices.
Every
aspect of the business was conducted through Fiji Hardwood
Corporation Limited (FHCL). And FHCL was haemorrhaging financially.
Over
the years, FHCL accumulated more than 20
million dollars
of Government-guaranteed debt, and made little serious effort to
service this debt. FHCL has also received Government grants of more
than 25
million dollars
since 1998.
So
again, I say reform was necessary. My Government had to do everything
in its power to help this Industry prosper, for the benefit of
economy and all the Fijian people.
My
Government introduced two Decrees to bring about this reform. They
introduced international best practices in management and operations,
a rational licensing scheme, and a vision for the Fiji brand.
As
I have said before, the Mahogany Development Decree instills
transparency and efficiency in FHCL’s management of this resource.
It formed the Mahogany Industry Council, and redefined the roles of
FHCL and the Fiji Mahogany Trust.
It
looks after the interests of all stakeholders, not just a privileged
few.
Thanks
to these reforms, we are now able to look toward the next phase of
development. To the new era I mentioned earlier.
It
can be easy to forget that this Industry is about more than the end
product. There’s a lot that goes into that product. Carting,
replanting and harvesting all play crucial roles. Each of these
facets mean opportunities for new jobs and new businesses.
And
we are committed to ensuring that the landowners benefit from these
new opportunities – that they are given the opportunity to
participate in a more meaningful and tangible way.
As
the Chair highlighted in her presentation, the Forestland Group has
also been brought on board to carry out a thorough analysis of the
current management system at FHCL.
With
the assistance of this international renowned forestry management and
development consultant, we hope, in the very near future, to install
a new management system that is more efficient, transparent, modern
and founded on internationally acknowledged best practices.
Once
this system is in place and allowed to take root, landowners will see
more and more of the benefits of the reform process.
The
second Decree – the Mahogany Industry (Licensing and Branding)
Decree – establishes a comprehensive regime for the licensing and
branding of Fijian mahogany.
This
is what we are here to celebrate today. The granting of licenses to
buyers of Grades 3 to 5 mahogany.
We
wanted to make sure the companies that are licensed to sell our
mahogany are committed to helping us develop a quality Fijian brand
that will fetch a higher price on the international market.
To
date, the Council has lodged registration of the Fiji Pure Mahogany
Brand in more than 19 countries.
No
longer can unscrupulous buyers sell Fijian mahogany mixed with
illegally harvested mahogany from other parts of the world.
We
also wanted to make sure the companies that are licensed to sell our
mahogany are committed to adding value to the product. And that these
value-adding activities take place in Fiji.
This
will create more jobs – especially for our rural populations and
our women. It will introduce new skills and technologies and will
open new factories.
I
congratulate our new partners who have received licenses to sell
Grades 3 to 5 mahogany. You have all stated a commitment to Fijian
mahogany and a commitment to Fiji. With this commitment of yours, I
am confident you will have a productive and profitable future.
I
would like to point out that SMI – the company granted a license to
purchase Grades 1 and 2 mahogany – has a substantial number of
women working in its sawmill, is operating state-of-the-art machines,
and is making world-class guitar components out of Fijian mahogany.
This
is the standard that we expect and is the standard our mahogany
deserves.
We
look forward to working with you to make sure that this standard is
upheld.
Vinaka
vakalevu and thank you.
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