By PMIZ Watcher

While the Papua New Guinea government has recently reaffirmed its commitment to the Pacific Marine Industrial Zone project in Madang, despite some vociferous local opposition [1], it seems major international companies are rejecting the project and choosing instead to invest in Lae.

The government claims that the PMIZ will become a major hub for tuna processing in the Pacific region with up to 10 processing factories that will create 30,000 jobs.

But at the same time that the government is seeking to finalize a US$71 million loan from the Chinese government to build the infrastructure for the PMIZ, major companies from SE Asia, including Thailand, the Philippines, China and Taiwan are all choosing to invest in new tuna processing factories in Lae.

The Century food group from the Philippines, for example, has recently teamed up with leading global tuna supplier, Thai Union and local fishing giant Frabelle to build a $20-million tuna processing plant in Lae. [2] 

The Thai Union group is the leading producer and exporter of frozen and canned seafood in Thailand and tthe biggest tuna canning company in the world, currently supplying about one fifth of global demand.

Together, the three companies describe themselves as 'global leaders in seafood processing and fishing'. Their new plant will have an initial capacity of 120 metric tons per day which will be upgraded to 300 to 350 MT.  

Another factory is being built in Lae by a Chinese company,  Zhoushan Zhenyang Deep-Sea Fishing Co (a subsidiary of Zhejiang Hailisheng Group Co Ltd) and a joint venture partner from Taiwan, at a reported cost of US$20 million (K55 million). [3] This on-shore tuna processing plant will be the first by a Chinese company in PNG and will process 250mt to 300mt of tuna a day and employ some 3,000 local workers.

The International Fisheries Corporation, a mackerel canning firm in Lae, has also indicated that it will soon add tuna processing to its repertoire. It plans to initially process 40 MT a day and expand to 120 MT. [4]

All this tuna processing investment in Lae is being actively encouraged by the Morobe Provincial government and its prominent governor, Luther Wenge. On a recent trip to the Philippines, Wenge said “We also wish that Morobe will be the ‘tuna capital’ of Papua New Guinea,” noting also that in PNG "the center of business is in Lae City". [5]

At a recent public forum in Madang government Ministers were questioned on what has happened to K25 million in public money released by the PNG government in 2008 for the PMIZ project, as there is nothing on the ground to show for it. [6] A further K44 million was allocated in the 2010 budget. The Ministers pointedly ignored the questions.

With major investors choosing to go elsewhere, vocal local opposition and unanswered questions about the squandering of large sums of public money, suspicions are only going to grow about the economic viability of the PMIZ, whether it is really a genuine attempt to create a tuna processing hub, and the real reasons behind the governments dogged support for the project.