Barker on issues with rice market

INSTITUTE of National Affairs executive director Paul Barker, pictured, says plans to restructure the rice market should consider competition issues in a balanced manner for domestic growers and companies which import it.

Barker was responding to a recent explanation by Minister for Agriculture and Livestock Benny Allan on the delay of the Central Province Rice Project to be operated by Naime Agro Limited.

“This proposal of Naime’s has always appeared to be an exercise in securing a State-endorsed monopoly or near monopoly over rice sales,” he said.
“PNG needs a competitive market for rice and other staples as an essential part of its National Food Security Policy, as well as overall competition and macro-economic policy.

“But it also needs to provide support to those producing and marketing all staple foods, notably through improving national infrastructure to make it easier and more reliable for producers and traders to bring root crops and domestically-grown rice to the market.”Barker said there was a range of other measures to improve the

business environment for all agricultural production, marketing and processing in PNG, as highlighted in the recent National Agricultural Summit.
“It’s long been considered that the Naime proposal has largely been about trying to make money from a trading monopoly or near monopoly, rather than producing and trading domestically grown rice,” he said.

“But they should be welcomed to participate in the trade on a competitive basis, and investing in production – but not at the expense of PNG consumers, through higher prices generated by protective import duties and restrictions on competition.”

Barker said the credibility of the Naime Agro Industries Limited and the reputation of a particular principal owner should be a point of concern for the authorities.

The Price Control Bureau has been reactivated under the Ministry of Finance and Economic Management.

After deactivation in 2009, the Ministry of Finance has reactivated it to ensure traders, persons engaged in commercial activities and persons providing services do not take advantage of the recent Value Added Tax (VAT) increase to deprive consumers of the purchasing powers through raising prices of their goods and services on their shelves.

The Bureau was deactivated 8 years ago and left unattended but it was not repealed.

The current coalition Government led by the Prime Minister, Charlot Salwai, is reactivating the Price Control Bureau under the Leadership of the Minister of Finance and Economic Management, Gaetan Pikioune.

During the first day of the current coalition partners, as outlined in the 100 Days Policy Plan, Activity 5 under the Ministry of Finance and Economic Management medium and long term plan, the Government had mandated the Ministry of Finance to set up the Price Control Bureau.

Following the ongoing development, the Council of Ministers (COM) in its Decision 55 of 2016, sets out the clear mandates which calls for the establishment of a Price Control Bureau under the Ministry of Finance and Economic Management Corporate Service. And to immediately set up the Bureau.

The Council of Ministers’ 9th ordinary meeting approved that in the medium term a supplementary budget of Vt10 million be allocated to the Price Control Bureau and 2 Officers be undertaken.

The Council of Ministers also approved that a review of the Price Control Act and the Public Health Act be undertaken with a view to amalgamate the two legislations in order to collaborate in reducing NCD-related health risks from imported and locally produced goods to the population of Vanuatu.

The Council of Ministers in its decision also approved that the composition of the Prices Advisory Committee to be made by the Minister of Finance and Economic Management will be subject to another Council of Ministers (COM) paper.

The Council of Ministers also endorsed the idea to engage a technical advisor during the initial phases of establishing the Bureau with funding to be sourced externally and as part of the Terms of Reference (TOR) to also review other Act(s) relating to the issue of pricing. The Council of Ministers decision at the time agreed that these tasks should be undertaken within the next two months.

According to the Ministry of Finance, the process is now in place to implement and reactive the Price Control Bureau.

The ministry is reportedly mindful of the fact that traders, persons engaged in commercial activities, and persons providing services, are taking advantage of what the Ministry of Finance describes as minor increase in VAT, to deprive consumers.

The Ministry of Finance is now very determined to have the Price Control Office fully operational before the end of this fiscal year, a Ministry of Finance Official told the Daily Post.

He said, in the interim, the Ministry of Finance and Economic Management is contracting the services of a prominent figure to operate the Bureau to implement the functions of the Bureau while the Government seeks to find a permanent solution, says the Ministry of Finance official.

The Ministry of Finance official says the ministry wants to protect the people of Vanuatu and all consumers from being taken advantage of by traders, persons engaged in commercial activities and persons providing services in raising prices of their goods and services at the shelves.