Region getting competitive; PNG, New Caledonia vying strongly for FDI'
Biscuit Company of Fiji, a group company of Flour Mills of Fiji, or FMF is one of the region’s great export success stories, with its presence continually growing not only in the islands but also in New Zealand and Australia. <!--more-->
[caption id="attachment_7592" align="alignright" width="350"]<a href="https://pacifictradeinvest.com/PTI/wp-content/uploads/2015/12/LRGrsz_ramrecent2.jpg"><img class="size-full wp-image-7592" src="https://pacifictradeinvest.com/PTI/wp-content/uploads/2015/12/LRGrsz_ramrecent2.jpg" alt="Mr Ram Bajekal is the Group Managing Director of Fiji's FMF Group." width="350" height="441" /></a> Mr Ram Bajekal is the Group Managing Director of Fiji's FMF Group.[/caption]
The growth figures of the biscuit and snack foods manufacturer speak for themselves: in 2004, its export sales was just 17 per cent of its total sales turnover. In 2014, it had grown to 38 per cent.
A recipient of top export awards in 2011 and 2012, this year the company received a commendation for its export performance at the Fiji Prime Minister’s Exporter of the Year Awards in November. Pacific Periscope caught up with FMF Group Managing Director Ram Bajekal at the awards for a brief interview. Mr Bajekal who was Group Chief Executive Officer since 2009 was appointed Managing Director in early 2015. He is a qualified chartered accountant with over 35 years’ experience in corporate management. He studied management as a Fullbright Fellow for Management Studies at Carnegie Mellon University, Pittsburgh, USA.
He spoke to Pacific Periscope on FMF’s success, the challenges of exporting to the region and attracting investment in the region.
<em>Pacific Periscope (PP): What’s your impression of this year’s awards? </em>
Ram Bajekal (RB): This year’s awards night saw a much larger gathering, for sure. The focus was clearly more on the Exporters, with audio visual clippings about their business being shown while the awardee was receiving the prize. That was a nice touch.
<em>PP: What has helped FMF increase its share of exports so impressively over the past few years?</em>
RB: Firstly, taking a view that our market is not just Fiji but the entire Oceania region. That increases our target population to 11 million without Australia and New Zealand and nearly 40 million if we include the two. This helps us focus on and manufacture products that are suitable for marketing in all these countries, rather than merely in Fiji. Our knowledge on the intricacies of these small island markets helps us produce and deliver what they need, much better than some of our Asian and other competitors.
Being small producers ourselves, we are able to find economies even in the scale relevant to smaller oceanic countries. Larger producers would struggle to make economic sized batches relevant to small markets. The Regional Trade Agreements like MSGTA and SPARTECA certainly help. Also, being in a thinly populated country forces us to look outside for growth; and as you know, what doesn’t grow, dies!
<em>PP: What are the most significant challenges in the way of Fiji growing as an investment destination?</em>
RB: Investor perception from past experiences about it being a politically turbulent place; Logistical challenges, both physical and in the form of high costs; inadequate locally available raw material and high dependence on imports; skills scarcity, especially on the technical side; smallness of market for those viewing just the Fiji market…
<em>PP: How could Fiji leverage its growing profile to realise its potential as the South Pacific’s hub?</em>
Fiji has tremendous potential to fulfil that promise. It would of course need to balance its short-term needs with its long-term vision. It can ill afford to do things in the near-term that may damage this long-term potential. The Pacific region is getting competitive with countries like Papua New Guinea and New Caledonia vying strongly for Foreign Direct Investments. Therefore Fiji needs to be closely watching what is helping its business sector and what is hurting it. Fiji’s advantage over its neighbouring Pacific Island Countries is its manufacturing sector – it needs to bolster that even more.
<em>PP: What are some of the other sectors that hold promise for exports?</em>
RB: Agriculture has huge potential and Fiji has the opportunity to be the food bowl of the region. It could create facilities that help convert ‘farming’ into ‘agri-enterprise’ where a person engaged in agriculture does not merely grow produce and then sell to intermediaries but has opportunity to move up the value chain by post-harvest processing, packaging, branding and marketing. This has potential to attract the younger generation back into farms. To enable this, Food Technology Parks, using Public-Private-Partnerships as a means of funding could be a way forward, with capable food technologists and marketers assisting people using these facilities. Of course, continued focus on infrastructural developments in Fiji is imperative. Highly efficient ports would also be necessary.
To be a true hub means not only trade but other socially important things as well. Therefore, working on providing best-in-region services in aspects like education, healthcare, financial services, entertainment, conference facilities, telecommunications, etc., would make Fiji an even more attractive regional hub, which in itself will bring in more investment and opportunities.