FIJI WATER BOTTLERS STOP PRODUCTION

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Protest over new export duty

SUVA, Fiji (Fijilive, July 7, 2008) –Ten bottlers of Fiji-manufactured artesian water have collectively agreed to cease production immediately until the "extraordinary attack" against the bottled water industry is resolved.

In a joint statement following its meeting in Suva this afternoon, the bottled water-exporting companies said the decision to impose an increased duty on this export commodity would prove unprofitable for the industry.

The statement was signed by Warwick Pleass of Pleass Beverage in Walu Bay, Suva; David Roth of Fiji Water; Anup Patel of Flour Mills of Fiji’s VTY; Steve Johnson of Mr Pure; Jai Dayal of Island Chill; Mohammed Altaf of Aqua Pacific; Mohammed Nafiz of Diamond Aqua; Jilyin Wong of Tapoos Beverage; Sam Ahmed of Fresh Spring Limited; and Ritesh Naidu of Mineral Waters of Fiji.

Fiji’s Cabinet yesterday approved to impose a 20 cents/litre export duty on all Fiji’s mineral water exports and a 20 cents/litre excise duty on mineral water sold for domestic consumption.

Interim Minister for Finance, National Planning, Sugar Industry and Public Utilities (Water & Energy) submitted to Cabinet that the major reason for the new duties was to stimulate conservation of Fiji’s scarce natural resources.

"Mineral water is a scarce resource which will deplete and a fair share of returns has to be passed on to the nation," Chaudhry said in his submission

Chaudhry could not be reached on his mobile this afternoon when contacted for comments following the bottlers’ decision to immediately cease production.

The statement said that by way of comparison, the carbonated soft drink industry in Fiji was only subjected to a $0.03 cents per litre excise tax and no export duty.

It further stated that the scheme put forward by the Finance Ministry created a tax of $0.20 per litre.

"The proposed action will weaken the Fiji bottled water industry’s ability to compete in markets around the world, where our competitors typically enjoy support – not taxes – from their local governments," the company representatives said.

"This will inevitably lead to a reduction in much-needed export revenue from our industry," they said.

"The new tax structure makes it highly unprofitable for our industry to bottle water and therefore, our immediate action is to cease production until we can resolve this extraordinary attack against the bottled water industry."

The bottlers said they were concerned that the finance ministry was again taking "exceptionally poor advice to levy onerous excise and export duties on bottled water in a misguided effort to reduce the country’s budget shortfall and to supposedly protect water resources in Fiji".

"For example, the water from our sources is a completely renewable resource that is constantly replenished by abundant rainfall each year. Moreover, the very livelihoods of our companies rely on the health and well being of our water sources. This ensures that the nation of Fiji will benefit from our sources for generations to come."

The statement said with respect to the unreasonable excise and export duties on all bottled water in Fiji, "to the best of our knowledge there is no precedent in the world for a product in the water industry to be slapped with this kind of an export duty." In fact, most every other nation actively encourages exports of this kind with generous incentives."

Fijilive: http://www.fijilive.com

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