PNG COCOA INDUSTRY SEEKS K25 MILLION DEBT WRITEOFF

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By Baeau Tai

PORT MORESBY, Papua New Guinea (The National, Aug. 7) -
Agriculture and Livestock Minister Moses Maladina will urge the Government to
write off an outstanding debt of K25.4 million owed to the State by the
country's cocoa industry.

This will allow the industry to devote more funds to research
and extension services, market promotion and onshore processing, the minister
said. 

Maladina made his intentions known yesterday when he presented a
K2 million check from the PNG Cocoa Board to the Government, to reduce the
industry's debt arising from the Cocoa Price Support Loan. 

The check was received by Treasury Minister Bart Philemon.

At the same, the board is investing a further K1 million in
Treasury Bills to help the Government improve its cash flow.

Last year the cocoa industry contributed to the National
Government a record K255 million in export earnings.

Maladina said the money paid to the Government was raised
through the cocoa levy which was re-imposed in February this year and reflected
higher prices being received for cocoa and higher cocoa production.

"The payment of the K2 million reduces the outstanding
balance of the Cocoa Price Support Loan from K27.4 million to K25.4 million. The
loan has been outstanding since the Agriculture Guaranteed Price Support Scheme
ended in 1995," said Maladina. 

"Over the years price support was provided, a total of
K81.8 million was paid to cocoa growers. About half - K42 million - was provided
from Stabex funds, a debt which has already been written off. The industry has
so far repaid over K10 million of the price support funds provided earlier by
the national government," Maladina said

The turn around in the fortunes of the cocoa industry after
setbacks such as the rebellion on Bougainville, the Rabaul volcano eruptions and
a prolonged period of low world prices is a tribute to the hard work of
producers and now sound management by the Cocoa Board, he added.

It is important that the industry is given every possible
encouragement to build on the success achieved in the last eight or nine months,
Maladina said. 

He said the Government's package of incentives for the
agriculture sector will assist the cocoa industry to grow, and maximize its
potential.

Meanwhile, board chairman Jimmy Simitab said if the Government
writes off the industry's remaining debt, this would result in the cancellation
of the levy of K160 per tonne, currently being imposed on producers's prices.
"This will mean that our producers will keep more of their hard earned cash
and our rural communities will be better off in the long run," he
said. 

August 7, 2003

The National: www.thenational.com.pg/

 

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