Business
World Of Opportunity
Office Encourages Trade With China
For the past three years, the Pacific Islands Forum Trade Office in Beijing has been leading the way in selling the Pacific Islands to China's businesses, tourists and investors.
The task is not an easy one, with distance, language and a lack of information just a few of the many hurdles to building bridges between these two neighboring but diverse regions. But with Pacific Island countries looking to diversify away from the mature markets of Australia, New Zealand and the U.S., China's rapidly expanding economy certainly seems appealing.
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Trade between the Pacific Islands and China is still limited by the island countries' small economies and poor transportation. Exports from China to Oceania, not including Australia and New Zealand, were US$357 million in the first eight months of this year, according to China's Ministry of Commerce. Imports were US$311 million. Nevertheless, this represents a tripling of trade since 2001, when total trade was US$199 million.
Despite China's enormous size and resources, Pacific Island countries still have a lot to offer, according to Rohan Ellis, head of the trade office in Beijing.
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Pacific
noni: the next “big thing” in China? (Photo:
AP Wide World Photos)
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A large proportion of trade is in natural resources such as timber from the Solomon Islands and Fiji, and natural gas from Papua New Guinea. However, Ellis says, Pacific Islands can offer more specialty products to the Chinese market, such as noni juice, fragrance oils and premium water products.
One particularly hot item is black pearl, which makes up more than three-quarters of all exports from French Polynesia. Import duties to China are still prohibitive, so most enter the Chinese market via Hong Kong, but demand is rising.
Regarding tourism, one of the most potentially lucrative economic sectors in the Pacific, Ellis says progress has to be planned and measured.
The number of tourists from China visiting the approved tourist destinations in the Pacific Islands (Fiji, Tonga, Vanuatu, the Cook Islands, and more recently, the Northern Marianas) rose from 35,000 in 2002 to a predicted 48,000 this year, according to Ellis. The number is expected to rise by 15 percent a year with increased cooperation with the South Pacific Tourism Organization.
"We should not rush forth, as places like Thailand or Malaysia did," Ellis says. "The Pacific Islands are much more delicate. Apart from Fiji and Tahiti, the Pacific Islands are just not ready for mass tourism from China."
Pacific investment in China is still small, but a few Tongan companies have set up food processing plants and furniture factories in the island province of Hainan, and other furniture makers can be found elsewhere in China.
It is also possible, Ellis says, for Pacific Island nations to attract Chinese investment, althoughinvestment proposals will have to be professionally packaged, and the flow of information between the two regions will have to improve to reduce risk and misunderstanding.
In particular, Pacific Island countries are looking for investment in real estate and infrastructure, much of it related to the tourist industry. Ellis says he is not expecting much investment in the fishing industry because Chinese fishing companies perceived the risk to be too high. However, Ellis acknowledges there is still some resistance in the Pacific Islands.
"Most of this fear is unfounded," he says. "Things are changing, as more information flows and there are more exchanges."
