A pioneer in ‘Tuna Country’ - Pedro Celso, Vice Chairman of the Pacific’s Tuna Industry Association

Buses bound for Pedro Celso’s RD tuna canning factory in Madang are marked, ‘Tuna Country’. It’s a sign of the importance of the industry in the north coast of the Pacific island of Papua New Guinea (PNG). The Filipino-born Managing Director of RD Canneries set up his business from scratch in 1995. It now employs a staff of 3,500, mainly women. He is also Chairman of the PNG’s Tuna Industry Association, Vice Chair of the Pacific’s Tuna Industry Association and is a member of the PNG/European Union negotiating panel on the new Economic Partnership Agreement (EPA).

Country-wide, the canning industry employs around 10,000 people, with other factories located at Lae and Wewak   and there’s potential to expand under the ‘interim’ EPA, a free trade agreement with the EU. PNG is only one of two countries to date to have signed an interim EPA with the EU, the other being Fiji.  PNG exports mainly to the United Kingdom, Germany and Holland.

“If it weren’t for the EU, I don’t think the industry would survive”, says Pedro Celso. The new EPA trade rules permit PNG to export its canned tuna to the EU duty-free, despite having middle income country status. He points out that a change in the rules of origin system under the EPA potentially allows tuna caught by boats from Taiwan, Korea, Japanese, China, the United States, or any other boat landing their catch in PNG to be processed in PNG canneries and still exported duty-free to the EU market. This, at least in theory, will stimulate further investment in PNG’s processing and canning industry.

But according to PNG-based diplomats, after more than two years of operation of the new rules, the PNG share of EU imports of canned tuna is still marginal at around 14,000 tonnes out of an import total of 400,000 tonnes. And although the European Parliament ratified PNG’s EPA there are still periodic vocal protests from a limited number of MEPs about PNG’s access to the EU market, notably from Spain which also has a canning industry. According to Martin Dihm, the EU’s Ambassador in PNG: “We are conducting a comprehensive study to identify the impact of the provision and it is hoped that this will create full transparency and also contribute to convincing doubting MEPs and help us talk to governments about any foreseeable problems”.

“What we are trying to do is to process loins and then send them for canning in the EU Spain and Italy for canning. It will be a win/win situation”, says Pedro Celso of the PNG’s industry’s future plans.

But he doesn’t predict a huge expansion of the local industry: “The way I look at it is that it will take ten years to establish the industry in PNG at the moment. We are struggling to expand”. He largely puts this down to high production costs within PNG including electricity charges. The Chairman adds that he’s worried about EU extending duty-free trade provisions to other countries with tuna processing industries in future World Trade Organisation (WTO) talks.

Debra Percival