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FIA-PNG: Rebate Scheme Review Consultation

The second industry roundtable consultation on the review of the Rebate Scheme(RBS) was convened at Ela Beach Hotel on the 23 rd October. The engagement was facilitated by NFA’s lead

consultants Andy Saunders and Glenn Hurry. The general objective of the review is to measure the impact of the rebate scheme accorded to onshore tuna processors in Papua New Guinea. Specifically, the review will inform the government of the costs and benefits of the scheme since its introduction in 2018.

The review focused on the six tuna processor currently operating and benefiting from the Rebate Scheme. These includes RD Tuna Canners, South Seas Tuna Corporation, Frabelle PNG Ltd, International Food Corporation, Majestic Seafoods and Nambawan Seafoods. The review also took account of those fishing companies associated with the tuna processors.

The consultant’s informed that after their individual meetings with respective companies, the review was to take into stock the interconnection of rebate scheme and the vessel days scheme. Hence the discussions during the consultation were around;

•   the current operating policy and regulatory environment in PNG and the regional organisations (PNA and WCPFC)

•   financial analysis of the operational costs of processors

•   impact assessment of the rebate scheme on NFA both income and capacity to sustain RBS

Industry representatives raised some critical issues for the consultants to take account of in their final reporting and recommendations. These include:

•   PNG domestic vessels have begun relocating and going bilateral with other PNA. As the vessels departure numbers increase this would result in lesser revenue for NFA and with compounding implication of the losing PNG’s fishing efforts and ultimately Parties Allocated Efforts (PAE) for the Vessel Days Scheme (VDS). The primary top three (3) reasons for vessels who have gone bilateral with other PNA countries are VDS price, access to eastern high seas (EHS) and the labour permit for foreign crews (especially fishing masters) .PNG must consider competing with other PNA countries cheap VDS price to maintain vessels in PNG thereby able to sell VDS.

•   The different PNA countries approaches to discounting days undermines integrity of PNA.

Further the tolerance by PNA for endorsing high seas fishing is a concern as it weakens VDS.

Options to curtail could be for high seas fish to be imposed with penalty fee (distort the market

price at Thailand or where unload).

•   Allow for export of whole round subjecting a levy on the export permit.

•   Rebate to also be applied to fishing sector as already approved by a NEC decision.

  •   The Domestication Policy needed be improved with more specific strategy and actions in regards to the overarching policy to which the Rebate Scheme and VDS should support.

Industry representatives generally stated that the rebate scheme initiative was to encourage onshore and downstream processing of tuna resources, create employment opportunities, generate socio- economic benefits and grow the economy.

The consultants will finalize their review, before presenting to NFA for consideration.

FIA was represented by President- Sylvester Pokajam and Executive Officer-Jonathan Manieva


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