1. Growing Fijis Manufacturing Sector A presentation at the Fiji Business Forum Suva 4-Jun-2011

2. Factors enabling Manufacture Land –Raw Material Labour –Intelligent workforce –Cost-effective Capital –Equipment, Plant & Machinery Entrepreneurship Market Access

3. Where we have a natural advantage Raw Material proximity: –Timber / wood (furniture) –Agri processing (sugarcane, pawpaw, pineapple, dalo, cassava, coconut, ginger, tobacco, herbals) –Processed Marine based (e.g., Starkist) –Mining & minerals (incl cement?) –Water –Natural / Eco (organic, bio-tech) –Dairy, meat & poultry processing

4. Jan-Sep $10.76 m $2.32 m $14.35 m Source: Fiji Bureau of Statistics

5. Where we have a natural advantage Raw Material proximity: –Timber / wood (furniture) –Agri processing (sugarcane, pawpaw, pineapple, dalo, cassava, coconut, ginger, tobacco, herbals) –Processed Marine based (e.g., Starkist) –Mining & minerals (incl cement?) –Water –Natural / Eco (organic, bio-tech) –Dairy, meat & poultry processing

6. Other advantages / reasons Non-price competition: –Fiji – perception of pure & unspoiled (can we do herbals?) –Consumer culture similar to PICs and A&NZ (comfort in dealing, quality and disclosure standards) Strategic: –Food security (Oxfam prediction) –Trade Balance & forex imperatives –Employment & income generation Based on EPAs, RTAs: –TCF Historical: entrepreneurial daring

7. What we DONT always have Large domestic market Economy of scale Labour Productivity Adequate supply of skilled tradespeople Access to R&D / Technology Geographic / Logistic convenience

8. Why we need to continue with Manufacture Spine of sovereignty Value addition opportunities / backward integration / market access GDP growth Multiplier Effect Flow-on effect Employment & Income generation

9. John Smith started the day early having set his alarm clock for 6 A.M. While his coffeepot was perking, he shaved with his electric razor (Made in Japan ) (Made in China ) (Made in Philippines ) Why Americans cant find Jobs…* * - source unknown

10. He put on a trendy shirt, his designer jeans and tennis shoes After cooking his breakfast in his new electric skillet, he sat down with his calculator to see how much he could spend that day. (Made in Sri Lanka ) (Made in Singapore ) (Made in Vietnam ) (Made in India ) (Made in Mexico )

11. Setting his watch to the radio, he got into his car, filled it with gas and continued his search for a good paying AMERICAN JOB. At the end of yet another discouraging and fruitless day checking his computer, John decided to relax for a while. (Made in Taiwan ) (Made in India ) (Made in Germany ) (From Saudi Arabia ) (Made in Malaysia )

12. He put on his sandals, poured himself a glass of wine, turned on his TV and wondered why he can't find a good paying job in AMERICA. (Made in Brazil ) (Made in France ) (Made in Korea ) AND NOW HE'S HOPING HE CAN GET SOME HELP FROM HIS PRESIDENT…

13. ( Made in Kenya )

14. Industry % to GDP Industrial Growth Forex Reserves Ranking Foreign Direct Investment Ranking Brazil29%4.4%716 Russia41%1.9%312 India29%4.8%529 China49%10.7%15 Mauritius25%5%110 Fiji13.5%2.5%~ 132

15. Therefore:

16. What will help ….1 Continuing tariff support (small domestic market & no economies of scale) Cautious approach on EPAs with countries that are kicking away the ladder Recognition of our size & limitations when mingling with manufacturing giants National focus on Productivity & Quality –Skill based National Training Plan –Quality initiatives –Enabling IR environment Improved infrastructure (roads, bridges, electricity, water, telecom)

19. What will help ….1 Continuing tariff support (small domestic market & no economies of scale) Cautious approach on EPAs with countries that are kicking away the ladder Recognition of our size & limitations when mingling with manufacturing giants National focus on Productivity & Quality –Skill based National Training Plan –Quality initiatives –Enabling IR environment Improved infrastructure (roads, bridges, electricity, water, telecom) Stability / predictability in Taxes & Legislation

20. Long Term Industrial Policy (LTIP) based on competitive advantage/ strategic needs (FEDB ?) and a consultative process Trade delegations & overtures based on LTIP (publicity / leaflets based on that) Tax Free Zones in viable areas of Viti Levu (Naitasiri, Tailevu, Namosi, Rakiraki) Forced value addition? Price controls that encourage investment Control over imports / level playing field on contents (fortification, NIPs, ingredients) Encouraging display of Local products Continue export incentives Job creation subsidy What will help …. 2 too!

23. Stability / predictability in Taxes & Legislation Long Term Industrial Policy (LTIP) based on competitive advantage/ strategic needs (FEDB ?) and a consultative process Trade delegations & overtures based on LTIP (publicity / leaflets based on that) Tax Free Zones in viable areas of Viti Levu (Naitasiri, Tailevu, Namosi, Rakiraki) Forced value addition? Price controls that encourage investment Control over imports / level playing field on contents (fortification, NIPs, ingredients) Encouraging display of Local products Continue export incentives Job creation subsidy What will help …. 2 too!

24. Vinaka vakalevu