Collaboration with Chinese firm seen as boosting PNG as seafood exporter

After the government of Papua New Guinea signed a memorandum of understanding with a Chinese fishing company late last year to build a seafood processing plant on an island in the Torres Strait, it attracted criticism in Australia about regional security risks and depletion of fishery resources.

However, analysts largely dismiss the fears as unwarranted, saying that critics ignore the economic benefits the project will bring to PNG, including jobs for local people.

Leon Perera, chief executive of the research and consulting firm Spire, said the project could create the foundation for a seafood export industry for PNG.

The memorandum of understanding was signed in November by Fujian Zhonghong Fishery Company, based in Fuzhou, Fujian province, PNG’s fisheries minister Lino Tom and the governor of the island nation’s Western Province, Taboi Yoto, to build a “comprehensive multifunctional fishery industrial park” on Daru Island.

The project, costing about $150 million, is part of the Belt and Road Initiative that aims to boost international links and economic development through infrastructure-related investments. The fishery park signaled a major boost to PNG’s ambition to establish itself as a significant exporter of seafood.

As is the case with many poor countries, PNG could not work toward realizing its goal without financial help from outside. Fortunately, China stepped in, aiming to assist a developing country with which it had built friendly relations in recent years.

PNG was the second Pacific country to join the BRI in 2018 to help build the necessary infrastructure needed for a developing economy.

The plant, which will come up in an impoverished region, will serve as a center for processing fish taken from the Torres Strait, between PNG and Australia. The region is known to be abundant in marine resources, including fish, prawns and lobsters.

The Australian Broadcasting Corporation reported recently that a delegation from the Australian Department of Foreign Affairs and the Australian High Commission in PNG traveled to Daru early last month to meet local officials and discuss the Chinese project.

After the meeting, Yoto said that he does not want his people to remain living in poverty.

“As usual, they (Australia) came with no alternative plans to counter and deter any foreign direct investment, especially to alleviate poverty and improve social services,” Yoto wrote in an article titled “We will not sway”.

Australia’s Foreign Affairs Minister, Marise Payne, told the Senate, the upper house of the country’s federal parliament, last month that Australian customs would be patrolling the Torres Strait to ensure that the traditional-only fishing rules in the region, agreed to between PNG and Australia, are enforced.

“Commercial-scale fisheries would not be considered a traditional activity under the Torres Strait Treaty and would not be permitted,” she said.

Interests and concerns

Tom, PNG’s fisheries minister, acknowledged the “growing interests and concerns” and said “existing bilateral agreements will be respected”.

But PNG is “within its sovereign rights” to be considering the project, he said, which could “boost economic activity in the area”.

PNG’s fishing industry is underdeveloped and has huge potential to become a major exporter of seafood given the bountiful fish, prawn and lobster stocks.

Perera said: “The challenge is for PNG to create an effective made-in-PNG brand for the seafood industry.”

Things such as hygiene, production best practices, sufficient quality control and a pool of skilled manpower will be vital, he said.

China’s ambassador to PNG, Xue Bing, has said that with 2 million square kilometers of ocean, PNG is well placed to supply China’s rapidly expanding middle class with quality seafood.

Fujian Zhonghong Fishery Company, established in 2011, has had a long involvement with PNG, mainly in fishing and seafood processing. The company’s investment is expected to enhance PNG’s ability to comprehensively develop and utilize its own fishery resources.