Stimulating investment in pearl farming in ... - World Fish Center

4 Doing business in Solomon IslandsEnvironmental and ecological factors are a small part of the decision making that needsto accompany investment in Solomon Islands. Perceived problems over security,stability, corruption and government intervention may sometimes deter foreigninvestment but, if due caution is exercised, investment in Solomon Islands is as secure asin any Pacific islands country (see Appendix V). This is a particularly acute area for pearlfarming, as in most cases little return is made for at least six years and net profit may taketen years or more to achieve. Long term stability is essential. An important preliminaryto assessing what information needs to be given to potential investors was to attempt todetermine which issues would be in their minds when considering investing in SolomonIslands. A workshop was held for MFMR staff and technical assistants which addressedthis question circuitously by considering the advantages and disadvantages of SolomonIslands – and how disadvantages can be mitigated. Outcomes of this workshop weregrouped under two questions, many of which have been covered already in this report,but others of which have not. The author’s selection of key issues to address in theremainder of this report, which deals with economic, cultural and structural issues areitalicised.Why grow pearls in Solomon Islands?• Both black-lip and white-lip pearl oysters are native to Solomon Islands• A national ban on harvesting both species exists with no intention to rescind theban• There is a 10 year history of collection of spat of black-lip pearl oyster andproduction of pearls has been demonstrated• Pearl oysters grow fast in the warm, well-flushed coastal lagoons of SolomonIslands• The environment includes very many more-or-less sheltered coastal lagoonswhere suitable growth conditions may be found for either or both species• Cyclones are very rare• Labour is cheap, income opportunities in rural areas are rare and many ruralcommunities are eager to negotiate use of land and waters• Alternatively there is government land where leaseholds are secure• The government is willing to negotiate incentives to committed investors• There are no other pearl operations in the country and a unique branding ispossible• Solomon Islands are less than three hours by air from Brisbane, has an increasingexpatriate community and tourism is expected to increase• The Ministry of Fisheries and Marine Resources is eager to facilitate such aninvestment and has committed to assisting investors through the early phases ofany such project• Options exist for a phased entry, with joint public-private research towardscommercialisation of Solomon Island pearls possible using existing hatchery andfield facilities15