Opulent Subsistence

Misa Telefoni Retzlaff is both the finance minister and the deputy prime minister of Samoa. He is a certified public accountant and an attorney who has practiced both professions in Samoa and New Zealand. In the late 1970s he was president of the Western Samoa Chamber of Commerce. He has been on the board of directors of companies in Fiji, New Zealand and Samoa, as well as serving as a director of the Pacific Forum Line. In 1992, he was appointed minister of state. Now, as a deputy leader in the Human Rights Protection Party, he is also Finance Minister and Deputy Prime Minister. He holds the chiefly titles of Misa, from the village of Matautu in the Falelatai district; Lesamatauanuu, from Malaela in Aleipata district and Tugaga from Faletagaloa in Safune district.

Pacific Magazine: Our magazine recently published excerpts of a report by Australian economist Helen Hughes claiming that aid from metropolitan countries had done nothing but harm in the Pacific Islands. Yet Samoa seems to be using aid rather shrewdly. What's your response to her claims?

Deputy Prime Minister Misa Retzlaff: First of all, I think it's unfair. This is my first reaction to the Hughes report. For instance, in a case like the Solomons, it's unfair to judge aid by the chaotic state of that country now. The people are in a serious situation socially and economically and to say aid has been a failure is highly unfair. Quite clearly the land situation in Honiara, where people have come back after 10 transfers of ownership and said, "This is our traditional land." The Malaitans, who tend to be more successful in business, bought up much of the land around Honiara. This is creating enormous problems.

We have only to look out my window from the sixth floor of the Central Bank of Samoa building looking upland and you can see all these lands around Apia that belonged to two traditional title holders. They later became Catholics and conveyed the land (when it was possible to convey lands) to the Catholic church. Since then, it has been bought out by many of the local merchants. Now I can only imagine what would happen if the two current title holders came and said, "We want our land back."

Land use is an endemic problem in the Pacific. Foreign direct investment people need security of tenure, either in freehold or in secure long-term leases. As a businessman, I'd want secure tenure for as long as it took to get return on my investment, or to be able to convey the land if I wanted to sell my business. These are choices that people in the Pacific need to make. If our governments cannot guarantee security of tenure, then I'd be very pessimistic about the future of the Pacific.

PM: What do you do?

MR: Yes, do you allow the traditional chiefs to mortgage or sell the lands for the benefit of the current title holders? There is a compromise. For instance, long-term leases or, in some cases for targeted investments, the government can take the lands and pay the title holders fair compensation and then sell it on to a foreign direct investor.

PM: Getting back to the Hughes report, she compared race relations in the Pacific Islands unfavorably to Mauritius.

MR: Yes. There they have a very highly industrious Indian population that is fully and harmoniously integrated into the society. And I just imagine what Fiji would have been like now if they had found a way to integrate the Indian community into their society. We would not have had all these coups. The social contract was there at the time of independence. The Indians were perfectly happy to run business and the Fijians could run politics, but they never felt the need to write this into the constitution.

PM: How has Samoa dealt with racial diversity?

MR: We have the suli system. For instance, I've ancestors from Ireland, Sweden and Boston, but I've got Samoan blood on both sides, so when I sit in those (chiefly) meetings, it doesn't matter how much-all that matters is that I'm a suli, or heir to that title. Many of our MPs are part-Chinese.

PM: It looks like the government and the private sector are working quite closely together in Samoa.

MR: There is no question that our government views the private sector as the engine of growth for the country. What does that mean? For me it means that any business person with a bankable deal can walk into the bank and get the financing they need. In other words, there is access to as much credit as the person can borrow within the criteria of the lending institution. So, as finance minister, I need to insure there's enough liquidity out there for the banking sector to fund the private sector.

PM: What about remittances?

MR: Remittances might rightfully be called the mainstay of our economy. I got into an argument with a lady from the International Monetary Fund who said Islanders living overseas should stop sending money because it makes people at home lazy. I told the bank to mind their own business. But I also went to my statistics department and had them do geographic mapping on the areas that receive the most remittances. Then I had them map the areas of most economic productivity. In actual fact, her contention was absolutely untrue. Some of the areas receiving the most remittances were also the most productive in taro production, for instance.

We remain classified as "underdeveloped country" because they don't count remittances. But if they did, I'm sure we'd no longer meet the criteria of underdeveloped. We receive approximately US$600 per year in remittances for every man, woman and child in the country.

PM: One way you interact with the business community is to meet with the Chamber of Commerce.

MR: Yes, I personally meet with the executive board of the Chamber about every two months. In the last meeting, which I called, they said they felt that with the new Samoa Tel building going up and the new Aggie Grey's being constructed (near Faleolo airport), that this would dry up all the credit available. I want the business people to flag these problems before they happen so they can say to me, "Look, Misa, there's going to be a liquidity problem."

So we need to be vigilant and so we stopped the Development Bank building that was also going up because we've decided we can only have two large, locally-funded projects happening at any one time. I'm saying to the Chamber that they always have access to me and that, together, we need to anticipate these things.

PM: You've said publicly many times that the aim of the current government is make sure the benefits of growth are shared with the poorest of the population. What's the strategy for this?

MR: We're working through the Asian Development Bank to distribute US$3 million a year in micro-credit loans. We also have the Small Business Enterprise Centre. They run courses and arrange credit for people in the lower echelons.

All our people also have access to education and healthcare virtually free. Everyone has access to electricity and clean water. A friend of mine at the ADB described the Samoan situation as "opulent subsistence." What it comes down to is the laughter factor. If you go to the market you'll see people joking among themselves and talking to each other.

We've got the growth, so now we have the luxury of worrying about the fair distribution of wealth.

PM: We hear rumors that you'll be prime minister one day.

MR: Of course there are people who say that, but I'm very happy and comfortable with my present role. I enjoy the challenges I face as finance minister and as deputy leader of the Human Rights Protection Party.

Our current leadership structure has a great depth of talent. We have a strong leader in Prime Minister Tuilaepa, who also served as finance minister, and who's been responsible for the improvement in the economy.