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Sustainable Mahogany Closes Business Here

Sustainable Mahogany Closes Business Here
June 11
08:00 2016


Sustainable Mahogany Industries Limited (SMIL) has confirmed it is closing down its production facilities in Pacific Harbour.

In addition to SMIL, also being closed is its sister company, Pacific Western Timbers (Fiji) Limited. The move has been attributed to alleged practices and lack of transparency within Fiji Hardwood Corporation Limited (FHCL) which was supplying Mahogany to them.

The two American owned companies have done business in Fiji under Mahogany licences since 2011 and 2013 respectively.

Director John Wagner, in announcing this, said they had decided not to renew the licence for SMIL and terminate the license for Pacific Western Timbers.

Mr Wagner claimed FHCL supplied just over half the Mahogany to SMIL that it was required to supply under SMIL’s licence.

He claimed they also supplied less than one-fifth of the Mahogany to Pacific Western Timbers that is required to supply under the Pacific Western Timbers license.

Mr Wagner further alleged that during this same period, FHCL over-supplied other licence holders at rates that were up to 15 per cent less than the rate FHCL charged to Pacific Western Timbers.

He said these actions by FHCL were in direct violation of the terms and condition of the license. When asked to comment on this, FHCL chief executive, Guiseppe Dal Bosco, requested all questions and materials to be delivered at their office.

When asked about the possibility of responding via email, he said he would not be available to check his email until after 3pm.

Questions were sent via email to him but no responses were received when this Business Liftout went to print at 1pm yesterday.

Meanwhile, the Fiji Independent Commission Against Corruption confirmed receiving a complaint on the matter.

FICAC further confirmed investigations have commenced but they would not be able to release any further details as the investigations are currently underway.

Meanwhile, comments are also being sought from the Ministry of Public Enterprises on this issue.


Investment and staffing

Mr Wagner stressed during the time of operations here, both their companies have infused in the Fijian economy over $11 million in license and reforestation fees (over and above the cost of logs).

They have also employed up to 100 Fijians at the Pacific Harbour facilities who would now be out of job.

But Mr Wagner said all SMIL employees will receive a generous redundancy package with potential bonuses.

Mr Wagner has emphasised their decision is no reflection on the Fijian Government’s efforts to revitalise Fiji’s mahogany industry.

“The two companies support many of the steps that have been taken, but we are bound by US Law and cannot continue working with FHCL at this time,” he said.



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