Pacific Forum Line

Forum Samoa...one of PFL's vessels.

Nowadays the only waves made by the Pacific Forum Line are those from its container ships as they push their way along their South Pacific cargo routes with what normally is clockwork efficiency.

This year, the regional shipping company reached its 25th birthday. All 12 owner governments are very happy with it. They are the Cook Islands, Fiji, Kiribati, the Marshall Islands, Nauru, New Zealand, Niue, Papua New Guinea, the Solomon Islands, Tonga, Tuvalu and Samoa.

They are actually being paid dividends from its profits.

The Pacific Forum Line, headquartered in Auckland, New Zealand, is one of the South Pacific's shining examples of regional co-operation and ownership. If managed the way it is run, that is to say by hard-headed shipping men and kept free of politics‹it is practically 100 percent assured of a glowing future, with a secure niche in the presently changing world shipping business.

It wasn't always like that. Launched to sea in 1978 with a capital of just NZ$100,000, a ridiculously small amount for a shipping line, it ran into bad financial trouble as many Pacific Islands ventures are apt to do, and in 1983 nearly sank for good in debt.

It became highly political with Robert Muldoon, a cantankerous New Zealand prime minister, emerging as its saviour when Australia's Bob Hawke was all for closing it down as a failure.

Its success now poses a question. If Pacific Islands governments can make a happy go of the shipping business, why can't they emulate Pacific Forum Line with a regional airline as a substitute for all the small one-jet national airlines that are costing their governments a mint of money, so much so that their whole national budgets are gasping.

Australia is mounting a study to find a solution to the regional airline crisis, if there is one to be found, and now intends to extend it to regional shipping too.

Dan Tufui, Tonga's now retired Chief Secretary, who in September stepped down as Pacific Forum Line's veteran chairman, can partly provide an answer to the questions to be examined by the Australian study.

He was with PFL from its earliest days, all through the times when Fiji didn't want a bar of it and when Australia almost pulled the plug on the venture by cutting off its aid for it, leaving New Zealand to save it, which it did.

For Tonga, he was also a participant in the flopped effort to get a regional airline up in the air with Fiji's Air Pacific as the vehicle.

Robert Muldoon...PFL owes so much to.

"There was a simpler formula for success in shipping than in aviation," he says.

With aviation, there were too many bilaterals (landing rights agreements) that had to be negotiated at that stage. It's very unlike shipping, where you can just sail into a port on the freedom of the sea principle. There are less problems attached to running a shipping line.

"We couldn't find the right formula to satisfy the needs of everyone. We had looked into the world examples of regional airlines and went into it with SAS (Scandinavian Airline System, operated jointly by Norway, Sweden and Denmark) in our minds as an example of successful cooperation. But that wasn't enough and consequently we decided to let it go. With shipping, all you need to do is provide a better service than your competitor and you're home."

PFL runs two new Chinese-built container ships to link Australia and New Zealand with Fiji, Tonga, Samoa and American Samoa.

It operated the 4000-ton, 150-container Forum Rarotonga on voyages from New Zealand, the Cook Islands, Tonga and Samoa and another ship, the Forum Fiji, on 21-day voyages from Auckland to Samoa and Tonga.

What originally was a small business located in Apia, Samoa, is now a diversified and sophisticated international enterprise.

Next March it will open a NZ$44.5 million container freight station in Auckland. This will have 25,000 square feet of space and nearly 20,000 square feet of canopy space and 4000 square feet of office space.

It will handle weekly up to 120 containers of export and import cargo. The company intends to move into airfreight consolidation in addition to its wide range of freight forwarding, cartage, export document, sea freight, and clearance and delivery activities.

Pacific Agencies (Fiji) Limited was formed in 1999 as a joint venture by PFL, Adsteam Agency Fiji Ltd, owned by an Australian company, and Quadrant Pacific, owned by Tasman Orient Line, owned in turn by the big Swires shipping group and Ahrenkiel. It has freight stations at Suva and Lautoka and handles airfreight.

Forum Shipping Agencies of Samoa is wholly owned by PFL and has a modern, fully bonded depot at Apia.

Forum Shipping Agencies Tonga is also wholly PFL owned and like the Samoa branch works with the latest computer equipment.

Forum Shipping Agencies New Zealand has Auckland and Christchurch offices. PFL is evaluating the possible replacement of the Forum Rarotonga with a larger, more efficient ship depending on cost and availability of alternatives.

Through PFL's history, it has had to fight against competition with at times up to seven or eight shipping companies that moved on to its routes when business was cold. The consequential competition brought down freight rates that left PFL battling for survival.

"Freight rates are at such low levels compared with earlier days, that they are about 40 percent below what they were in the early days," says John McLennan, PFL's chief executive since 1985.

He says that since the industry continues to be intensely competitive, he doubts whether they will ever bring PFL the revenue and profit it needs to achieve its original objective of serving all PFL consortium countries.

Pacific Forum Line headquarters... Auckland, New Zealand.

In the past, PFL ran an Australian and New Zealand subsidised small ship to Tuvalu, Kiribati and the Marshalls and a large container ship east-west through Melanesia to Papua New Guinea.

McLennan says that globally, the shipping industry is moving towards alliances with such giants as P and O and Nedlloyd teaming up and Mersk and Sealand getting together.

PFL has been driven into alliances also, working in its patch of the Pacific with P and O and Nedlloyd and Swires.

PFL's future is as a niche operator in the Pacific Islands region working with the big boys, he says.

"We must become a feeder and hubbing operation."