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

species in Australia are 5 – 10 times more valuable than those from black-lip pearloysters. However, gold and cream pearls, produced by the same species in Indonesia andPhilippines, are worth much less. It will therefore be important to establish the likelyproportion of high value pearls in the crop before any commercial investment is likely totake place.As to where to invest, there are likely to be numerous potentially suitable farm sitesaround Solomon Islands. Marine environmental conditions are generally good, althoughconcern was expressed over the numerous logging operations observed, and theconsiderable runoff and sedimentation problems they are clearly causing. SolomonIslands has seen few, sporadic assessments of water quality or the abundance of planktonon which pearl oysters feed. A routine monitoring programme of simple water qualityvariables would help identify the most suitable farming locations. There are pockets ofrelative abundance of natural pearl oyster stocks in the Manning Straits, Nggela andMarau Sound, so presumably these locations would be suitable areas for farming.However other areas may exist where conditions for growth are better, but where stockshave been fished out.A source of concern for investment in Solomon Islands remains the ease with which pearlfarmers might obtain secure exclusive rights over areas of water. All the investors havesuccessfully negotiated aquatic leases in their own areas of operation, and establishedmutually acceptable working arrangements with customary landowners. However allrecognised that, while clearly not impossible, this would be a first in Solomon Islands,and that assistance would be needed from national and provincial governments to ensurethat the requirements are understood and arrangements will be respected. At fullcommercial scale farming may require one or more areas of coastal water of 150-250 haeach.There was general agreement that, irrespective any regulatory requirements, it would bedesirable for any overseas pearl farming investor to have a local business partner whounderstood the Solomon Islands operating environment and could act as the projectinterface when dealing with customary landowners, government agencies and locallogistics and procurement. The local partner would preferably be someone with extensivebusiness experience in Solomon Islands, as well as a significant financial stake in theoperation.6.2 Commercialisation and FinancingSpecific issues that were highlighted during discussions between investors and localofficials and businessmen included issues of commercialisation and financing.Investors noted that in other pearl farming countries, significant industry consolidationhas occurred in the past few years as a result of excess production, including of lowqualitygoods, and falling prices. As a result, large numbers of small farms have mergedor been bought up by other operators, resulting in a smaller number of larger operations.In French Polynesia, 1500 ‘family farms’ have been absorbed into about 250 largerfarms: in Cook islands, the 70 or so farms previously operating are now down to about20, with numbers still declining; in Australia, the current 15 or so operators will likely bereduced to 3 or 4 in the next few years. In general, small farming operations in which just28