Tuna industry: Wolves at the door

For the big three -Fiji Fish, Sea Quest and Solander- the writ­ing was on the wall as far back as 1979.

"I was with Prime Minister Laiseania Qarase and others on a trade mission in 1979; he was shocked, but did nothing," said Fiji Fish director, Grahame Southwick.

The tuna industry pioneer tried another way; limit fishing licences.

By the time the wolves were at the door, Mr Southwick was outvoted in a meeting where he was the only one with a fleet, huge shore facili­ties and a factory.

He was also the only one with 20 years' experience in what was about to unfold. "I had been to China to see the fleet preparing to come to Fiji," Mr Southwick said.

"At that meeting, there were about 50 in the room, including one or two other local companies with one boat.

"They all wanted more ... the other 40 had no boats, no factories, no in­vestments to lose. "They were given a vote."

The verdict, no limit to fishing licenses. "Licenses were issued and ap­proximately 90 companies that started, were bankrupt by 1985," Mr Southwick said.

"That was when I was able to convince the government to consider tuna setting up a stabilisation fund to rescue the industry. "Before that, no one would listen. "Now, we are all gone."

Tuna stabilisation fund

The tuna stabilisation fund was designed to keep the country's third leading industry of the time, in the game. Endorsed by Cabinet in 2014,

the innovative initiative spelt out conditions that strongly favoured locally-owned and controlled tuna fishing companies.

Under the fund, foreign flagged fishing vessels were levied a six­ cent fee each time they called in Fiji to restock on fuel and provisions. Of that sum, two cents went to the Government and four cents to locally-owned and controlled tuna fishing companies.

That levy under the fund -not tax­payers money, nor donor -amount­ed to millions of dollars. But the ailing industry- which took out loans from commercial lenders on the understanding that the tuna stabilisation would offset it-never saw a cent.

More than $100 million in losses was recorded by the tuna industry during the virtual collapse nine years ago. Well, at least for the three biggest industry players of the time, Fiji Fish, Solander and Sea Quest, who collectively employed at least two thousand local employees, most of them iTaukei.

Fiji Fish director Grahame Southwick.

"The industry knew well what was coming in 1979," Mr Southwick said.

The tuna stabilisation fund that Mr Southwick masterminded was a lifeboat, he said. "The government of the day recog­nised the need," Mr Southwick said.

"Fisheries knew we were dying, as everyone had to submit yearly audited accounts ... they knew we were drowning ... they knew we had created a lifeboat to save ourselves. "They had it in their hands.

"But as the ships went down, they looked away, withheld the emergen­cy funds that belonged to us, and let the industry drown."

Gone to the dogs

In the meantime, the effects of non-payment of the tuna stabilisa­tion fund are being documented by the big three.

These include:

• Severe cash flow problems that forced the sale of compa­ny assets at well below value;

• Inability to pay creditors, resulting in difficulties in obtaining fuel, and necessary services;

• Insufficient funds to order and store bait and spare parts;

• Inability to repair vessels, resulting in combined fleets - nine at Fiji Fish, seven at Solander, and six at Sea Quest - laid up one by one, over a pe­riod of six to seven years.

From a total of22 vessels, employ­ing 500 seamen, captains and engi­neers, and 250-300 shore staff, the numbers were reduced to zero.

• Inability to pay license fees resulted in fisheries threaten­ing and executing threats to licenses of30 years, in favour of foreign vessels.

• Inability to maintain vessels that were tied up, resulting in the seizure of all machinery, and $20 million value reduced to zero, with no one to buy even good boats, to put into a devastated fishery.

"It is not the fishermen who over­fish that cause the problems, it is the managers who fail to manage," Mr Southwick said.

"No one has as much to lose as the fishermen.

"Incompetent managers just pick up their pay each month and have tea parties, that's all it is."