ASIAN DEVELOPMENT BANK TAR:FIJ 36151

TECHNICAL ASSISTANCE

TO THE

REPUBLIC OF THE FIJI ISLANDS

FOR

INTERMEDIATION OF SECTOR RESTRUCTURING

June 2002

CURRENCY EQUIVALENTS (as of 10 May 2002)

Currency Unit – Fiji dollar (F$) F$1.00 = US$2.2247 US$1.00 = F$0.4495

ABBREVIATIONS

ADB – Asian Development Bank FSC – GDP – gross domestic product MASLS – Ministry of Agriculture, Sugar and Land Settlement SCF – Sugar Commission of Fiji TA – technical assistance

I. INTRODUCTION

1. In March 2002, an Asian Development Bank (ADB) Fact-Finding Mission visited the Fiji Islands to review the possible role of ADB in assisting the rehabilitation of the . The Mission held in-depth discussions with relevant agencies including the Sugar Commission of Fiji (SCF);1 the offices of the Sugar Tribunal; the Fiji Sugar Corporation (FSC); and the Ministry of Agriculture, Sugar and Land Settlement (MASLS). Extensive discussions were also held with workers, farmers, and representatives of indigenous Fijian groups. Field visits were made to sugar-growing areas.

2. The Mission found that the sugar sector is on the verge of a profound transformation. The industry is facing a major restructuring and a possible significant reduction in size as it adapts to a pending loss of preferential tariffs within 6 years. At the same time, significant changes are taking place in landholding patterns as longstanding smallholder leases expire, landowners reclaim their lands, and former growers are forced to find other sources of income. In addition, the processing infrastructure of FSC––the mainly Government-owned processing corporation––is seriously degraded, and the company is in poor financial straits. Proposals have been floated for the restructuring of the industry but have, so far, failed to gain support among all stakeholders. Indeed, it became clear to the Mission that there is considerable lack of unanimity among stakeholders in the sugar industry, particularly regarding potential solutions to imminent challenges.

3. Given the sugar industry’s major contribution to the country’s gross domestic product (GDP), foreign exchange earnings, and employment, its sudden collapse would have serious economic and social consequences. Yet under current conditions, such a collapse is entirely possible. To help resolve one of the major challenges facing the sector, the Government has requested technical assistance (TA) to prepare a project that would support both alternative livelihoods for displaced sugar cultivators, and also provide assistance to indigenous landowning groups wishing to make productive use of their newly reclaimed land.2 There is also a need to assist the Government in resolving the problems of the sugar industry as a whole so that a viable industry can emerge. Even if a large number of former sugar cultivators eventually find alternative activities, a revitalized, smaller, more efficient sugar industry would still have the potential to provide employment and contribute significantly to the country’s economic well- being.

4. However, a viable sugar industry is unlikely to rise from the current chaos unless all stakeholders agree on what needs to be done. To aid the Government in bringing all parties together to resolve the multitude of complex, interrelated issues facing the sector and to ensure the continued existence of the industry, the Government has requested support from ADB through advisory TA designed to help the Government and all stakeholders prepare an action plan for the rational and measured restructuring of the industry.

5. To initiate this support, the Mission and government representatives cooperated in designing a TA for Intermediation of Sugar Sector Restructuring.3 The proposal was discussed at a wrap-up meeting in Suva on 21 March 2002 and received the support of all stakeholders. As a result, the Government requested support from ADB for the implementation of the TA. The

1 A neutral oversight body whose role is to provide a forum for all stakeholders. 2 PPTA for Alternative Livelihoods is under preparation. 3 The TA first appeared in ADB Business Opportunities in March 2002. 2

TA framework is shown in Appendix 1. A summary initial poverty and social analysis is shown in Appendix 2.

II. ISSUES

6. Sugar production is a key sector of the Fiji Islands' economy. Sugar production covers 50% of the country’s agricultural land, directly employs 13% of the workforce, indirectly provides employment for a similar percentage, accounts for about 35% of agricultural GDP and 8% of total national GDP, is the country’s second biggest earner of foreign exchange (around US$125 million per annum compared with tourism at US$250 million per annum), and generates some 30% of total exports.4 In addition, unlike other export-oriented industries in the country, the domestic value of production is high. Almost all factors of production are indigenous, unlike the garment sector, for example, which depends heavily upon imported raw materials, as does the tourism industry to a lesser extent.

7. The sugar sector is currently facing a crisis, a situation that could have a major negative effect on both macroeconomic and social stability and the poverty status of the entire country. FSC, the mainly Government-owned entity that owns the country’s four sugar mills, is insolvent and requires an immediate injection of more than US$100 million simply to continue operating. The country is facing the prospect of selling sugar at world market prices within 6 years and has made no serious effort towards reducing production costs to a level that would allow the industry to survive the predicted drop in prices to one third of present levels. To the contrary, lacking appropriate incentives, field production efficiency has been dropping consistently, with increasingly negative consequences on the quality of both the sugarcane and the sugar produced. Foreign buyers have warned that they will find alternative supplies unless sugar quality from the Fiji Islands improves. Many sugarcane farms are too small and fragmented to produce anything but a subsistence level income. Finally, as a result of the expiration of leases of indigenous land, large numbers of experienced farmers are leaving the sugar areas, while indigenous Fijian landowners, some of whom are keen to grow sugar, are taking over leases but lack the capital and the appropriate skills for effective and efficient production.

8. Efforts have been made in the past to improve the efficiency of the industry and instill both productive practices and a measure of rationalization. For example, a Sugar Industry Strategic Plan produced in 1997 sets out a valid road map for reform that appeared to be agreeable to all parties.5 However, so far, partly because of the lack of alternative livelihoods for small farmers who might be displaced during the restructuring, most recommendations of FSC have not been implemented. These matter will now be addressed in the alternative livelihood project preparatory TA. More recently, FSC has worked with industry stakeholders to produce a document entitled The Fiji Sugar Industry—A Way Forward recommending a different (and more radical) approach to sector restructuring.6 The document has received a measure of acceptance within the industry, but it requires refinement, as it has not been embraced

4 Reserve Bank of Fiji Quarterly Review. December 2001. Suva. 5 Groups, entities, and organizations concerned with the sugar sector in Fiji include, inter alia, the 23,000 families of sugarcane growers themselves, the landowning individuals and clans who lease land to the growers, the Sugar Cane Growers Council, FSC (responsible for sugarcane transport and processing), the 3,000 workers at FSC, the Fiji Corporation, a variety of unions and political parties representing groups involved in the sugar sector in one way or another (including the two main political parties) and a range of government agencies including MASLS, the Native Land Trust Board, the Ministry of Commerce, and the Ministry of Foreign Affairs. 6 This would involve splitting up FSC into four independent companies operating under separate accounts, pooling all the sugarcane land under one master lease to each company, and subleasing to farmers. There are major concerns with this proposal. 3 unanimously. Some stakeholders remain hesitant. Clearly, assistance is required to help finalize a proposal based on the best of the 1997 and 2001 plans that can become the basis for a restructuring action plan. In the meantime, with the changes in land tenure currently taking place, the problems of the industry seem to be multiplying.

9. The challenges facing the country under these circumstances are manifold and appear to be beyond the capacity of national decision makers to resolve alone, as evidenced by the failure of the two most recent plans for the industry to achieve widespread acceptance.

III. THE TECHNICAL ASSISTANCE

A. Purpose and Output

10. The sugar industry in the Fiji Islands is embroiled in a complex web of problems ranging from land tenure issues to poor quality of the end product to an impending collapse in prices. Moreover, there seems to be no consensus among the stakeholders and parties involved regarding the means (or even the desirability) of restructuring the industry to ensure its survival. Nonetheless, the survival of the industry, or a controlled and measured withdrawal from it, is crucial to the economic well-being of at least one quarter of the population, and indirectly to the entire economy. The social and economic consequences of a sudden collapse (which is a real possibility if nothing is done) could be disastrous.

11. All parties agree that there is a need for outside intermediation to assist in advising stakeholders on the situation within the industry, bringing them together for constructive discussions on possible remedies, and assisting in finalizing an agreement on the ultimate form that restructuring should take. In view of ADB’s close development partnership with the Fiji Islands, the Government has requested its assistance in this intermediation process.

12. The purpose of the TA is thus to provide a neutral forum for stakeholder discussions and consultations on the restructuring of the sugar industry, along with the expertise to provide sound technical advice to the restructuring process. The intent is to initiate fully informed consultation and negotiation among all parties while managing the disputes that color at least some of the interaction between and within the various stakeholder groups. While rapidly achieving consensus with all parties may not be possible, it is conceivable to achieve enough common understanding to proceed with a medium-term consensus-building exercise as to how the sugar industry could best be structured in the future, who will participate in it, and how they will empowered to participate.

13. The assistance to be provided will consist of a team of experts skilled in intermediation with expertise that includes a knowledge of agricultural production systems in developing countries and their socioeconomic structure, a knowledge of the worldwide sugar industry, and a sound knowledge of the history and culture of the Fiji Islands.

14. The team’s activities will be focused on (i) raising the knowledge base of all concerned so that all parties fully understand the current tenuous situation of the sugar industry and the implications of inadequate action; (ii) initiating substantive discussions among and between stakeholders based on a full knowledge of the status of the industry as it now exists, and the consequences of lack of action; and 4

(iii) assisting in the preparation of a time-based action plan for sector restructuring, including an ongoing process of consensus building for remaining areas of disagreement.

15. The result of a successful intermediation exercise will, at the least, be improved political stability as stakeholders come to realize the gravity of the situation facing the industry. They will recognize the need for collaboration to either do something about it, or to work constructively to find alternative sources of livelihood for large sections of the population. Optimistically, the output of the TA would be a fully agreed upon action plan for the restructuring and salvation of the industry as a major employer and source of income and foreign exchange for the country, although agreement to continue the process of consensus building is a more realistic outcome.

B. Methodology and Key Activities

16. TA implementation will take place in three stages: (i) knowledge upgrading, (ii) the formulation of a restructuring concept and base model, and (iii) the preparation of a restructuring action plan (as described in para. 19).

17. With the possible exception of the officers of SCF, most actors in the sugar sector in the Fiji Islands seem to lack a comprehensive knowledge of the problems besetting the sector. Moreover, few understand the Fiji Islands sugar industry within the context of the global sugar industry. Thus, to arrive at an informed consensus among stakeholders will require a step-by- step increase in the knowledge of the Fiji Islands sugar sector and its status within a worldwide context. The first step will be for the consulting team to raise its own knowledge level through literature reviews; interaction within the team; and interviews with all the actors, including the industry’s customers. The next step will entail in-depth discussions and workshops with all stakeholders to elicit their concerns and priorities and to gradually ensure that they are all fully briefed on the real status of the industry. The third step will comprise informing all groups of stakeholders and the general public of the concerns and priorities of other groups.

18. Only when all stakeholders have approached a similar knowledge level will it be possible to initiate informed discussions among them on a mutually agreeable concept for a restructured industry. Since it is a point of common awareness, the starting points for discussion will be the current restructuring proposal put forward by FSC and the best elements of the 1997 plan. This will involve a critical review of the current proposal by key actors, and a decision as to whether these can serve as a base model or will require modification. The international knowledge and exposure of the consultant team will prove useful in helping the stakeholders make this decision. If a reformulation of the proposal is deemed necessary, the team will assist in identifying the key weaknesses and developing a revised concept.

19. Upon agreement among the stakeholders on a model for restructuring, the team will assist with the detailed design and implementation scheduling for a restructuring action plan and identify activities to be undertaken, as well as the agencies or entities responsible for implementation. The team will help identify any institutional changes that need to take place to ensure the efficient functioning of the industry under the new model. Finally, the team will help to pinpoint any policies, regulations, or legislation that need revision, reform, or abolition to ensure success of the restructuring, and will suggest appropriate revisions. 5

C. Cost and Financing

20. The total cost of the TA is estimated at US$940,000 equivalent, including US$585,000 in foreign exchange and US$355,000 equivalent in local currency cost. The Government has requested ADB to finance US$660,000, covering the entire foreign exchange cost and US$75,000 equivalent of the local currency cost. The TA will be financed by ADB on a grant basis from the ADB-funded TA Program. The Government will finance the balance of the local currency cost. A summary of the TA costs is provided in Appendix 3.

D. Implementation Arrangements

21. The Executing Agency for the TA will be SCF, which will provide advice, guidance, and direction to the consulting team during the implementation period. The TA will be implemented over a 6-month period, commencing around July 2002 and ending in December 2002. An inception report will be prepared within the first month and will form the basis of an initial tripartite meeting among ADB, the Government, and the consultants. Subsequent monthly reports will be submitted to the Government, SCF, and ADB. Tripartite meetings will be held during the second month, the fourth month, and towards the end of the sixth month. Due to the nature of the TA, ADB will undertake close monitoring of its implementation. The TA will require the services of 26 person-months of international (18 person-months) and domestic (8 person- months) consultants. The expertise could include

(i) a mediator/team leader experienced in agricultural development, (ii) a sugar industry specialist, (iii) a land tenure specialist, (iv) an agro-industry corporate management specialist, (v) a legal specialist, and (vi) a public relations specialist.

22. Provision has also been made for the recruitment of additional specialized international expertise, the need for which may be identified during TA implementation. This may be in the fields of sugar cane transport, factory rehabilitation, public information, and/or market negotiation. To ensure flexibility and the best possible expertise for each position, consultants will be engaged as individuals or as individual consultants from a firm by ADB in accordance with its Guidelines on the Use of Consultants and other arrangements satisfactory to ADB for the engagement of domestic consultants. Terms of reference for these experts are provided in Appendix 4.

IV. THE PRESIDENT’S DECISION

23. The President, acting under the authority delegated by the Board, has approved the provision of technical assistance not exceeding the equivalent of US$660,000 on a grant basis to the Government of the Fiji Islands for Intermediation of Sugar Sector Restructuring, and hereby reports this action to the Board. 6 Appendix 1

TECHNICAL ASSISTANCE FRAMEWORK

Performance Monitoring Assumptions Design Summary Indicators/Targets Mechanisms and Risks

Goal To prevent serious A time-bound action (i) regular reviews of the Despite the myriad economic and social plan for restructuring economy during problems facing the sugar disruption as a result or phased withdrawal periodic monitoring by sector, it is possible to of a catastrophic and from the sector, Asian Development produce sugar in Fiji at a uncontrolled collapse agreed to by all Bank (ADB) staff cost consistent with world of the sugar industry stakeholders, is market prices; if not, it is prepared by the end (ii) newspaper and possible for Fijians of the technical press reports involved in the sugar assistance (TA) sector (about 30% of the implementation (iii) government financial country’s population) to period. and economic reports switch to alternative livelihoods and for the economy to maintain equivalent levels of economic output and foreign exchange earnings.

Purpose To assist the Optimal: The sugar (i) regular reports by Rational discussion of the Government in industry is team leader issues and alternatives bringing about a restructured into a involved is possible restructured sugar viable, efficient (ii) regular reviews and among stakeholders once industry or a mutual industry operating at participation in tripartite all are fully aware of the agreement among world market prices meetings by ADB staff current state of the stakeholders on how with a minimum of industry and the to withdraw from it social disruption. consequences of inaction. with minimum negative social and Minimal: The country economic withdraws gradually consequences from sugar production with little or no social disruption. Outputs A time-bound action Action plan is (i) regular reports by Rational discussion of the plan for restructuring prepared by the end team leader issues and alternatives or phased withdrawal of the TA involved is possible from the sector, implementation (ii) regular reviews and among stakeholders once agreed to by all period. participation in tripartite all are fully aware of the stakeholders meetings by ADB staff current state of the industry and the consequences of not taking any action. Appendix 1 7

Performance Monitoring Assumptions Design Summary Indicators/Targets Mechanisms and Risks

Activities (i) knowledge base (i) intensive (i) regular reports by There are no undue upgrading among all discussions held team leader delays, disputes, or stakeholders between team and unexpected events that individual stakeholder (ii) regular reviews and prevent the TA from (ii) stakeholder groups within first 2 participation in tripartite following the planned discussions and months of TA meetings by ADB staff implementation schedule. consultation (ii) roundtable (iii) agreement on a discussions and model for consultations among restructuring all stakeholders within third month of (iv) preparation of a TA time-bound action plan to achieve (iii) base model restructuring agreed upon within fourth month of TA (v) fallback: preparation of an (iv) action plan agreed upon strategy prepared and agreed and action plan for to by end of sixth phased closure of the month of TA industry Inputs Mediator/team leader 6 person-months (i) regular reports by Consultants are properly team leader chosen and competent in their field Sugar industry 4 person-months (ii) regular reviews and specialist participation in tripartite No undue disruption to meetings by ADB staff the work schedule by Land tenure 2 person-months unexpected events specialist

Agro-industry 2 person-months corporate management specialist

Legal specialist 4 person-months

Public Relations 4 person-months Specialist

Specialized expertise 4 person-months as required

8 Appendix 2

SUMMARY INITIAL POVERTY AND SOCIAL ANALYSIS

A. Linkages to the Country Poverty Analysis Sector identified as a national Yes Sector identified as a national Yes priority in country poverty analysis? priority in country poverty partnership agreement? Contribution of the sector/subsector to reduce poverty in the Fiji Islands: The sugar sector in the Fiji Islands supplies employment directly or indirectly to at least 30% of the country’s population. Many people involved in the sector live at or slightly above the poverty line. Any contraction of the sector will push large numbers of families into poverty with no foreseeable alternative source of livelihood. This is especially the case for Indo-Fijians, who do not have ready access to land.

B. Poverty Analysis Proposed Classification: Poverty Intervention What type of poverty analysis is needed? Given the outdated HIES data, informed expectations of large increases in the incidence of poverty in recent years, and significance of the proposed project to both direct and indirect impact on poverty it is proposed that a rural household survey be undertaken that will assess both current incidence and nature of poverty and potential impact of the proposed assistance on poverty.

C. Participation Process Stakeholder analysis Stakeholders include the sugar cane growers, indigenous landowners, sugar mill employees, the Fiji Sugar Corporation (FSC), the Government (owner of FSC), suppliers of services to the industry, and the major political parties.

Participation strategy required: All stakeholders need to be fully informed of the current state of the sugar sector so that they can be brought together to discuss alternative solutions with a similar knowledge base free of misconceptions and misinformation.

D. Potential Issues Significant, Not Significant, Subject Uncertain, None Strategy to Address Issues Plan Required Resettlement Very significant Full consultation and a review of relevant Not known legislation Gender Significant Full consideration of potential gender issues Not known during all consultations Affordability Significant Full review of all options and their Not known implications Labor Significant Full review of all options and their Not known implications; base model to specifically address labor issues within and outside of sector Indigenous Very significant Full participation of representatives of Not known People indigenous people in restructuring consultations, especially as regards land Political SignIficant Politicians are considered as stakeholders Not known Interference and involved in the consultations Appendix 3 9

COST ESTIMATES AND FINANCING PLAN (US$'000)

Foreign Local Total Item Exchange Currency Cost A. Asian Development Bank Financinga 1. Consultants a. Remuneration and Per Diem i. International Consultants 422.0 0.0 422.0 ii. Domestic Consultants 0.0 40.0 40.0 b. International and Local Travelb 70.0 10.0 80.0 c. Reports and Communications 0.0 5.0 5.0 2. Surveys and Equipmentc 10.0 0.0 10.0 3. Study Tour, Seminars, and Conferences 20.0 8.0 28.0 4. Miscellaneous Administration and 0.0 5.0 5.0 Support Costs 5. Representative for Contract Negotiations 5.0 0.0 5.0 6. Contingencies 58.0 7.0 65.0 Subtotal (A) 585.0 75.0 660.0

B. Government Financing 1. Office Accommodation 0.0 90.0 90.0 2. Transport 0.0 30.0 30.0 3. Remuneration and Per Diem 0.0 50.0 50.0 of Counterpart Staff 4. Communications 0.0 20.0 20.0 5. Workshops and Seminars 0.0 30.0 30.0 6. Secretarial Support 0.0 30.0 30.0 7. Surveys and Publicity 0.0 30.0 30.0 Subtotal (B) 0.0 280.0 280.0 Total 585.0 355.0 940.0 a Financed from the ADB-funded TA Program. b Includes one international trip per expert except for the team leader (two trips) plus local car hire. c Includes a computer, printer, and audiovisual equipment. Source: Asian Development Bank estimates.

10 Appendix 4

TERMS OF REFERENCE FOR CONSULTING SERVICES

A. International Consultants

1. Mediator/Team Leader (6 person-months)

1. The role of the mediator/team leader will be to bring together all parties and stakeholders involved in the Fiji Islands sugar sector both within the Fiji Islands and in the major purchasing countries to ensure the full understanding by all concerned of the status of the sugar industry and to assist in bringing about a restructuring of the industry to meet the challenges facing it. She/he will have a background in agricultural development in developing countries, preferably a knowledge of the Fiji Islands and its history and culture, and an understanding of the social as well as technical complexities involved in agricultural production in tropical developing countries. Her/his detailed terms of reference will include the following:

(i) Undertake a thorough review of the history of the sugar sector in the Fiji Islands, the reports and literature written about it, and proposals put forward for its restructuring, paying attention to the 1997 Strategic Plan and the recent document produced by the Fiji Sugar Corporation (FSC) entitled The Fiji Sugar Industry—A Way Forward.

(ii) Visit the key contact points at the European Union in Brussels and the main purchasers of the Fiji Island's sugar in the United Kingdom and Portugal, and determine their concerns about the sugar industry in the country.

(iii) Consult with all stakeholders in the country (including FSC, the Government, growers, union members, landowners, the Native Lands Trust Board) as groups and (on a sample basis) as individuals, and ensure that they are all fully (and correctly) informed about the status of the sugar sector in the country and the proposals being put forward for resolution of the numerous problems facing it.

(iv) Methodically identify all major issues involved in the sector and bring representatives of the stakeholders together to discuss and, if possible, resolve each issue.

(v) Deal with the particular or special concerns of each group on a one-on-one basis, trying to put across the position of the other stakeholders.

(vi) Call in special expertise for advice and consultation as required.

(vii) Working with all the stakeholders, narrow the options for restructuring (including, for some, leaving the sector).

(viii) Identify any changes needed in policy, legislation, or institutional structure, and make recommendations (for concurrence by all stakeholders) for revisions as required.

(ix) Make recommendations for assistance (financial or technical) required for the successful restructuring of the sector.

Appendix 4 11

(x) Assist in the preparation of a final action plan for restructuring, to be agreed upon by all parties.

(xi) Submit monthly progress reports, and prepare a final report detailing and recording experiences in undertaking the technical assistance (TA), and make any final recommendation in terms of follow up, the future structure of the sector, and assistance required by it.

2. Sugar Industry Specialist (4 person-months)

2. The sugar industry specialist will be experienced in the worldwide sugar industry, having a broad knowledge of production systems, technology, industry structure, ownership systems, processing, the international sugar market, and future trends in the industry. She/he will provide a broad technical perspective to the work of the team. Her/his duties will include the following:

(i) Review the history of the sugar sector in the Fiji Islands along with previous and current proposals, and provide the mediator/team leader with a perspective on the sugar industry in the country in the context of global sugar production.

(ii) Assist the mediator/team leader in her/his discussions with stakeholders, providing a global and technical perspective on the issues raised and discussed.

(iii) Identify any specific technical expertise required to augment or supplement the expertise of the team, prepare terms of reference for such expertise, and assist in the recruitment of suitable consultants.

(iv) Review the proposals for restructuring evolving from the stakeholder consultations and provide constructive comments thereon, making alternative suggestions as and where required.

(v) Undertake specific consultations or studies as required to resolve specific issues that may arise in the course of restructuring consultations/negotiations.

(vi) Assist in preparing the final action plan and its timetable.

(vii) Make specific recommendations regarding the structure, responsibilities, staffing, and organizational location for a government line agency specifically concerned with the sound management and governance of the sugar sector.

(viii) Prepare a report detailing experiences in undertaking the TA.

3. Land Tenure Specialist (2 person-months)

3. The land tenure specialist will be experienced in the Pacific DMCs' (developing member countries) land tenure system. His/her duties will include:

(i) Review current legislation relating to land tenure in the Fiji Islands, the specific situation relating to land tenure in the sugar sector, and the current and evolving situation regarding the renewal of leases for sugar cultivation.

12 Appendix 4

(ii) In conjunction with the sugar industry specialist, review the likely requirement for and under an efficiently functioning sector operating at world market standards.

(iii) Review the major concerns of all stakeholders regarding the land tenure situation.

(iv) Review changes to land tenure suggested by stakeholders or required for a meaningful restructuring of the industry, including the idea of a master lease for all sugar land and subleases for growers, taking into account the fact that the industry will likely require significantly less land than is currently being cultivated.

(v) Discuss at length and in detail the land tenure requirement of a restructured industry with all stakeholders to ultimately reach a consensus on a mutually acceptable land tenure structure for the sugar sector.

(vi) Identify changes in legislation needed to ensure the access to land required by a healthy and functioning sugar sector, taking into account the concerns of the landowners, growers and FSC.

(vii) Prepare an action plan, for incorporation into the overall action plan, for the revision of land tenure legislation and the formulation of revised land tenure arrangements for the sugar sector.

(viii) Prepare a report detailing experiences in undertaking the TA.

4. Agro-Industry Corporate Management Specialist (2 person-months)

4. The agro-industry corporate management specialist will have extensive experience in the management of companies engaged in the production of tropical crops. She/he will advise on the possible future corporate structure and ownership of FSC and its relationship to its raw material (i.e., sugar cane suppliers). Her/his duties will include the following:

(i) Review the past history and structure of the sugar industry in the Fiji Islands and in association with the sugar industry specialist, compare the Fiji Islands situation with other parts of the world.

(ii) Critically review the current status and structure of the industry and the proposal for the restructuring the industry as embodied in the document entitled The Fiji Sugar Industry—A Way Forward.

(iii) Provide views and recommendations on the current structure and the proposed structure in the context of providing a basis for discussion of the industry structure by all stakeholders; in particular review the financial implications of the two alternatives, the question being whether the new structure (or an adaptation of it) would have readily identifiable managerial or financial benefits.

(iv) Assist in discussions and intermediation with all stakeholders to help determine a workable and acceptable corporate and managerial structure for the industry.

(v) Assess any required legislative changes to ensure an efficient and effective corporate structure. Appendix 4 13

(vi) Prepare a time-bound action plan for corporate restructuring.

(vii) Prepare a report detailing and recording experiences in undertaking the TA.

5. Various Specialized Expertise (4 person-months)

5. The consulting services to be provided for this category will consist of specialized technical expertise to be recruited as identified and required during the course of the team’s mediation work. This may include expertise on sugar cane transport, sugar cane processing, corporate finance, and/or information dissemination and public awareness. Selection of the expertise will be contingent upon the preparation of terms of reference and the approval of the Asian Development Bank prior to recruitment.

B. Domestic Consultants

1. Legal Specialist (4 person-months)

6. The legal specialist will be a qualified legal expert knowledgeable about legislation and regulations pertaining to the agriculture sector. This will include the Sugar Act, Native Lands Trust Act, Agricultural Lands Tenants Act, Sugar Master Agreement, and legislation relevant to the establishment of corporate entities as well as export regulations. Her/his duties will include the following:

(i) Provide the team with full knowledge of the legal background to the sugar and agriculture sectors and to land ownership/tenancy in the Fiji Islands.

(ii) Advise on potential legislative and regulatory changes required for the efficient functioning and restructuring of the sector.

(iii) Assist with stakeholder consultations and roundtable discussions, providing a legal background and basis for the current situation and any possible restructuring proposals and/or adaptations thereto.

(iv) Advise on the procedures to be followed to make required changes to existing regulations and legislation to assist in restructuring the industry.

(v) Where desirable and possible, provide draft revisions to regulations or legislation for submission to the appropriate legislative or regulatory body for approval.

(vi) Assist the team by providing local insight into its deliberations and discussions.

(vii) Prepare a report detailing and recording experiences in undertaking the TA.

2. Public Relations Specialist (4 person-months)

7. The public relations specialist will be experienced in polling and public opinion surveys as well as broadcast and information dissemination within the Fiji Islands, with the structure of Fijian society, with recent political and economic events and with the sensitivities of the population as a whole. Her/his duties will include the following:

14 Appendix 4

(i) Working with the team leader, ensure that all parties are informed of the purpose of the TA.

(ii) Undertake specific opinion and awareness surveys of all key groups to provide the team with an understanding of the key issues and the level of awareness of the overall situation facing the sugar sector.

(iii) Identify groups that need special targeting to enhance their understanding of the situation facing the sugar sector and the work being undertaken by the team, and prepare and carry out awareness campaigns aimed at them.

(iv) Continue to keep the general public informed of the progress of consultations and negotiations and the results thereof.

(v) Keep the team leader and other team members informed of group and public opinion about the work of the team and any action plans or proposals that emerge as a result of the team’s intermediation.