The government of Papua New Guinea (PNG) is working to overhaul the country’s fisheries sector as part of a series of reforms designed to achieve national status as a high-income, manufacturing economy by 2045.
PNG Prime Minister James Marape is pushing to “ensure the region and other Pacific island countries gain maximum benefit from their resources” through a transformation from being an exporter of raw resources into a manufacturer, according to PNG Business News. This vision involves a push toward downstream processing of the region’s marine resources, especially tuna, and efforts to have smaller Pacific Island countries send their tuna to PNG for processing.
“To make this leap from exporting raw resources to building a manufacturing-based economy, we must secure critical enablers like affordable and reliable electricity, accessible internet, and vital infrastructure such as ports and jetties. We need to reorganize our towns and cities, revamp our education system to prepare our people for industry-specific roles, and ensure our health facilities are prepared for this transformation,” Marape said following the 79th United Nations General Assembly (UNGA) in September 2024.
As part of that effort, the PNG Ministry of International Trade and Investment is partnering with the Madang provincial government and General Santos, Philippines-headquartered tuna supplier and processor RD Corporation to develop a 650-hectare development aimed at becoming a commercial hub for the tuna sector.
The Madang Integrated Special Economic Zone in Vidar, Madang, will be modeled after the Java Integrated Industrial Port Estate in Indonesia and General Santos in the Philippines. It will feature canneries, a fuel depot, cold storage, a slipway, a shipyard, and various associated businesses such as tin can manufacturing, a packaging factory, and aquafeed production facilities. The development will also feature a residential estate, shopping malls, schools, a bank, and an international wharf designed to improve shipping and logistics for the northern part of the country.
PNG accounts for 18 percent of the world’s tuna catch, but the majority is processed overseas, according to PNG Minister for International Trade and Investment Richard Maru. PNG’s fisheries exports have remained steady at PGK 1 billion (USD 255 million, EUR 232 million) since 2016, but most of the revenue comes from resource rents, Maru said.
“Papua New Guinea has missed significant opportunities over the past 49 years by being merely a rent collector in the fisheries sector. We should have fully domesticated our fisheries industry, but we have not. As a result, 80 percent of our catch is taken overseas, and we have missed out on building additional canneries, losing 50,000 jobs,” Maru told PNG Business News. “Our current net revenue is only PGK 300 million [USD 76 million, EUR 70 million] a year, but we could be generating PGK 5 billion [USD 1.3 billion, EUR 1.2 billion] in revenue. We also lose out on landing fees, shipping licenses, jobs, wages, income taxes, corporate taxes, GST, and local commercial opportunities linked to the fishing industry.”
Despite a 2017 sourcing deal signed between RD Corporation and Pacifical, the global tuna marketing firm representing the eight countries belonging to the Parties of the Nauru Agreement (PNA), the company has struggled to operate profitably in PNG, as it has lacked U.S. dollars to pay suppliers, according to the Post Courier, and has suffered supply shortages resulting in insufficient product to satisfy domestic demand, The National reported. Its facility in Madang, PNG, is currently producing around 150 metric tons (MT) of fish daily but needs 200 MT of output to maintain profitability.
As a marker of what is needed to ensure the success of the Madang Integrated Special Economic Zone, Maru cited the example of Majestic Seafood, a tuna canner in Lae, PNG, that closed in July 2023, resulting in the loss of 3,000 to 5,000 jobs.
“The plant was not able to source enough fish each day to process to its full capacity; it was only processing up to 15 to 20 MT of fish each day,” Maru told PNG Business News. “Most of the fish caught by other companies at sea were taken to other countries for processing. This also underlines the importance of owning our own fishing vessels and our own crew and introducing the domestication policy so we can land our fish onshore and process it in our cannery and enjoy the maximum benefits of our fisheries resources."
The Madang Integrated Special Economic Zone will be developed in two phases, with the first done as a 50-50 joint venture with RD Corporation, centered on developing PNG’s domestic fleet and fishing capacity, according to Maru. Under the agreement, RD Corporation will operate PNG-owned fishing vessels and employ local crew. If that is successful, the PNG government will advance the second phase of the project, involving a cannery and associated facilities on its own, which Maru said will then lure private industry into the development, along with tax breaks and other incentives.
“Fishing states often have a large fishing fleet, extensive coastal waters, and a strong presence in international fisheries management organizations. PNG has missed out big time by being a rent collector, and the Marape-Rosso government has made a very bold decision to shift us from being a rent collector to a fishing state," Maru said. “[But currently], we do not have the management experience nor the technology and skills of commercial fishing enterprise as a country. We need to partner and learn the trade of the commercial fishing business first over a period of time until we are confident to venture on our own. We have to learn to crawl before we can walk.”
Furthering this initiative, Marape has pushed for investment and market access from the European Union, Australia, and New Zealand, and recently told Pacific Islands Forum Secretary General Baron Waqa he hopes to build PNG into a regional tuna powerhouse that takes in raw material from other PIF nations.
“We are creating special economic zones to cater for fisheries and fish processing facilities in our country so your smaller island countries fish or tuna can be processed in PNG and exported to get maximum value,” Marape said, according to PNG Business News. “The Pacific has accounted for majority of the tuna export in the region to markets in Europe and Asia, but this is not processed rather goes as raw tuna. Now, the PIF member countries should move away from dollar grants to downstream processing and into trade-to-trade relations.”
Attending the 2024 Seafood Expo Asia in Singapore in September, PNG National Fisheries Authority Executive Manager Jonathan Manieva said as part of the overhaul of the country’s approach to fisheries, his agency is now formulating a 10-year roadmap to develop PNG’s seafood industry.
“The industry needed more in terms of a fixed playing field and a focused roadmap. There have been regular, frequent change in priorities, and they have asked for a long-term focus, which is where the 10-year plan emerged,” Manieva told SeafoodSource. “We have assessed ourselves and taken the lessons learned to put together the plan. And now, the government has given us the go-ahead to align everything according to that so we're taking a progressive, pragmatic approach in developing the cascading level of policies and work programs and supports to support the industry as we move into this next phase.”
The plan addresses the underlying issues that caused what Manieva termed a “mass exodus” of players in its domestic tuna sector over the past two years, which he said caused a “significant realization” changes needed to be made to the government’s approach.
Besides a lack of raw material, PNG’s tuna industry has struggled with a vessel-day scheme that originally charged as much as USD 10,500 (EUR 9,600) per day per vessel to fish in its exclusive economic zone. Even though the price was eventually dropped to USD 6,500 (EUR 5,900) for domestic vessels and USD 7,500 (EUR 6,900) for foreign vessels – a price more than most companies could afford to pay, given they can fish on the high seas with no surcharge.
“We saw they can also get the same incentives and access to fishing grounds in other parts of the region,” he said. “We needed to come back around to the drawing board under our reformation exercise and look at revising the original benchmark price, getting back the ability to have the agency make reforms to our vessel-day scheme, such as the ability to negotiate to set prices, plus also development packages. That's part of our domestic exchange plans going forward now.”
Manieva said fisheries-focused reforms will also include “institutional changes, policy changes, and legislation reviews.”
“Especially modernizing some of our business management policies so we have reformed to align ourselves with international conventions and higher-level global goals and objectives, especially addressing IUU,” he said. “It's a slow process, as this sectoral change also has implications with other economic sectors and our government policy. So we try to socialize and get everybody on board to support it, but it's slow.”
Manieva said getting buy-in from the industry for the reforms is one of his top priorities and that he believes thus far, the industry backs the effort. He said with continued industry backing, the reforms and roadmap will be rolled out in 2025.
“We believe that this refocused roadmap is giving our industry stakeholders a sense of direction and shows our commitment as a regulatory agency to managing the sector in a way that will work better for everyone,” he said. “They're coming back to the table. We're now streamlined on specific domestic policy that will guide our approach in having a more focused effort, driven strategies and programs to actually realize our domestic aspirations, and a long-term plan that allows for commitments of investment and aspiration. So we're hoping that it works and satisfies both sides of the table.”
Papua New Guinea Fishing Industry Association Sustainability Director Marcelo Hidalgo said the industry is committed to working with the PNG government on reforms to continue the industry’s sustainable growth trajectory.
“Our chairman, Sylvester Pokajam, and our team is drawing a 10-year strategic plan for the private sector to collaborate closer with the government in both fisheries and aquaculture sustainable projects, enhancing partnership with our global stakeholders,” he told SeafoodSource.
Hidalgo noted the country’s catch volume increased from 74,000 MT in 2020 – the year the nation’s fleet achieved Marine Stewardship Council certification – to 168,000 MT in 2023. The growth was mostly due to increased catches of yellowfin tuna, which reached 88,614 MT in 2023, up from 22,000 MT in 2020. Catches of skipjack and bigeye tuna have remained largely stable over the past three years, according to FIA’s annual report.
“We are one of the largest MSC-certified tuna fisheries because we were granted access to the PNA waters last year,” Hidalgo said.
While the FIA previously fought with Pacifical over the splitting of its MSC certification, and is currently battling an objection to MSC’s recertification of tuna caught in PNA waters from the International Pole and Line Foundation – which also objected to a scope extension of the certified fishery’s scope extension for bigeye and FADs – Hidalgo said the FIA continues to be committed to MSC certification as a growth strategy. It recently achieved certification of the PNG rock lobster fishery and is now pursuing certification of its mud crab fishery.
Hidalgo outlined numerous other sustainability measures being undertaken by the FIA and said the focus this year will be increased collaboration with research centers on achieving robust scientific data on which to base the country’s fishery management decisions. It has initiated new research projects with the University of Queensland on bycatch, with the University of Wollongong on crew welfare, and the Secretariat of the Pacific Community on biodegradable fish aggregating devices (FADs), according to the FIA annual report.
“The results of these research projects will be made publicly available, and we aim to help our partners in the Pacific region to learn from our lessons, whether good or bad,” PNG FIA President and Chair Sylvester Pokajam said in the report. “We are taking the lead, and we build on robust science to address global issues to do with our tuna resources.”
