Stimulating Investment in Pearl Farming in Solomon Islands: Final Report
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Stimulating investment in pearl farming in Solomon Islands: Final report Item Type monograph Publisher The WorldFish Center Download date 03/10/2021 22:05:59 Link to Item http://hdl.handle.net/1834/25325 Stimulating investment in pearl farming in Solomon Islands FINAL REPORT August 2008 Prepared by: The WorldFish Center, Solomon Islands, and The Ministry of Fisheries and Marine Resources, Solomon Islands Supported by funds from the European Union Ministry of Fisheries and Marine Resources CONTENTS 1 THE PROJECT...............................................................................................1 2 INTRODUCTION..........................................................................................2 2.1 Pearl farming in the Pacific.............................................................................2 2.2 Previous pearl oyster exploitation in Solomon Islands...................................4 3 THE PEARL OYSTERS................................................................................5 3.1 Suitability of coastal habitat in Solomon Islands............................................5 3.2 Spat collection and growout............................................................................6 3.3 Water Temperature.........................................................................................8 3.4 White-lipped pearl oyster availability.............................................................8 3.5 The national white-lip survey.........................................................................8 3.6 Water quality.................................................................................................13 3.7 Natural disasters............................................................................................14 4 DOING BUSINESS IN SOLOMON ISLANDS..........................................15 4.1 Security of investment..................................................................................16 4.1.1 Governance and law......................................................................................16 4.1.2 Land and land lease issues............................................................................17 4.1.3 Physical Security...........................................................................................18 4.1.4 Security of profits .........................................................................................18 4.2 Taxation and incentives................................................................................19 4.2.1 Tax structure .................................................................................................19 4.2.2 Incentives......................................................................................................19 4.3 Labour ...........................................................................................................20 4.4 Environmental impact assessment................................................................21 5 POLICY, REGULATION AND MANAGEMENT GUIDELINES............21 5.1 Policy ...........................................................................................................22 5.2 Legislation.....................................................................................................23 5.3 Licencing.......................................................................................................25 6 INVESTOR VISITS.....................................................................................26 6.1 Investor Feedback.........................................................................................27 6.2 Commercialisation and Financing................................................................28 6.3 Investor’s recommendations for next steps...................................................30 7 CONCLUSION.............................................................................................31 Appendix I Past research and development on black-lip pearl oysters in Solomon Islands. Appendix II Suitability of habitats in the Solomon Islands and other regions of the Pacific for growth of black-lip and silver-lip pearl oysters. Appendix III Water temperature and cyclone frequency in the Solomon Islands and other key regions of the Pacific: implications for pearl farming. Appendix IV Abundance, size structure and quality of silver-lip pearl oysters in Solomon Islands. Appendix V Solomon Islands: the investment climate for pearl farming. Appendix VI Pearl farming policy and management guidelines. 1 The Project The overall objective of the project is the reduction of poverty in rural areas of Solomon Islands through creation of livelihoods based on sustainable aquaculture. This fits within the over-arching goals of the WorldFish Center in the Pacific to reduce poverty and hunger in rural communities, and with the Ministry of Fisheries and Marine Resources (MFMR) to stimulate rural development and to develop aquaculture. It has been recognised that the nature of the pearl farming industry means that a high chance of success requires a long term investment from an established pearl farming organisation. This project has been specifically designed to compile the elements of a pre-feasibility study to provide offshore pearl companies with sufficient information to investigate the potential for long-term investment in pearl farming in Solomon Islands. The overall output of the Project was intended to be decisions by pearl farming companies in the region to invest, or not to invest as the case may be, in Solomon Islands, though these decisions are beyond the ability of project staff to influence. Throughout, staff have been admonished to provide unbiased, factual information free of weighting either for or against investment. The direct outputs leading to the decisions concerning investment are: 1. Documentation of past research and development on black-lip pearl oysters in Solomon Islands likely to be of interest to investors. 2. A national survey of the location, abundance and quality of white-lip pearl oysters in Solomon Islands. 3. Analysis of climatic and habitat comparative advantages of Solomon Islands for pearl farming. 4. A summary of the investment climate in Solomon Islands. 5. Policy guidelines for sustainable investment in aquaculture and pearl farming supporting small-holder community involvement. 6. High-level contacts within the offshore pearl companies most likely to consider investing in pearl farming in Solomon Islands. 7. Presentations to potential investors on the pearl oyster resources of Solomon Islands, results of research on culture methods and the advantages and risks of investment, and policies for development of aquaculture and pearl farming in Solomon Islands. 8. Recommendations to government concerning the licensing conditions for pearl farming to provide opportunities for small-holders to supply large farms, and to ensure that the industry operates in an environmentally sustainable way. 9. A synthetic report covering all project activities. Each of these elements has been completed and this report represents the ninth of them. Rather than repeating the information contained in the individual consultants’ reports, it will provide a broad narrative report synthesising the information obtained from the 1 various project elements to describe current conditions in Solomon Islands with respect to investing in pearl farming. For ease of reference, the individual reports accompany this draft report as appendices. It is encouraging to note that interest from pearl farmers was positive, with half of those contacted requesting more information. Ultimate success lies in landing one interested investor however, and it has emerged that there are other activities that might assist this process. At the end of this report we highlight the areas of ongoing research that the investors consider will overcome the remaining barriers to investment in Solomon Island pearls. 2 Introduction Solomon Islands is a tropical, maritime country. Comprising more than 900 islands and covering an area more than 900 x 250 km, the two parallel archipelagos that make up the geographical spine of the country run from 6.5 o to 11 oS. Outlying islands increase the area of the country still more. There are a myriad of undeveloped and unspoiled bays and semi-enclosed lagoons ranging from very small to the world’s largest double-reef lagoon system at Marovo Lagoon. One of the planet’s largest atolls, Ontong Java, is also found in Solomon Islands. For generations, Solomon Islanders have based their lives around the sea; today seafood still provides the bulk of dietary protein, fishing is part of a way of life for most rural Solomon Islanders and living away from the coast is a rarity. As islanders’ lifestyles have undergone steady monetisation, the sea has continued to provide, with trochus shell, beche-de-mer, shark fin and fish constituting important cash commodities. Mother of pearl (MOP), from black-, white- and brown-lipped pearl oysters has historically been an important cash commodity, although severe stock depletion led to the imposition of an export ban since 1994. With the hope that the ban has allowed stocks of pearl oysters to replenish and anecdotal evidence that this has been the case the Solomon Islands Government (SIG) has raised the question as to whether pearl farming, which contributes to the economies of some other Pacific countries, could be effective in Solomon Islands. This is a poor time to be entering the pearl farming community,