Economic Zone of agriculture

The National Business

SECRETARY of the Department of Trade, Commerce and Industry John Andrias (pictured) explained during the launching of a cocoa and chicken grain projects in East Sepik last Tuesday how these projects mark the first phase of the Sepik Plains Special Economic Zone. The Government is committed to developing the special economic zones in the country as an alternate mode for economic growth and prosperity besides the liquefied natural gas, mining and other extractive industries. Similar zones were proven successful in many countries in the Asian region to greatly improve the productive capacity of their economy. The concept was considered the best option by the Government to improve the productive capacity of the PNG economy on a sustainable basis by having specialized zones for Agriculture, Fisheries, Petro-chemical and others. Below is Andrias’ explanation on the Sepik Plains Special Economic Zone for agriculture and the merits of establishing this project in the Sepik Plains of the Yangoru Saussia district.
What is a Special Economic Zone?
It can be a specially defined area, with multiple occupancy. It:

  • has custom-built infrastructure and facilities;
  • allows any form of industrial or commercial activity;
  • enjoy special legal status to allow located enterprises duty-free imports and streamlined, efficient, timely and low-cost regulation and monitoring of their activities;
  • be monitored and regulated by a single, specialised, autonomous agency.

Why did the Government select Yangoru-Saussia?
It happens to be the only district in PNG with more than 18, 000 ha of State land (Urimo 13,000 ha and Hanawi 5,000 ha). It is a district with an estimated 100,000 ha os grassland lying idle since creation. For the first time in history, we are mobilising 100,000 hectares under the ILG process – not by GPS – to trial out this SEZ concept, which when successful, we will roll out to other areas of PNG. All adjoining districts (Wewak, Angoram, Ambunti Drekikier, Wosera Gawi, Maprik and Telefomin) constitute well over 400,000 hectares under customary ownership. We are already mobilising more than 60,000 hectares of customary land with initial boundary surveys done. The Government has made a firm commitment to support development of this concept with a commitment of K100 million. To date, only K56 million has been released. Further funding will be required to develop the necessary pre-requites infrastructure.
What is the basis for the SEZ project enabling infrastructure development
Any potential site selected has to be conducive for any investor to make a decision to invest. No investor will make an investment decision to invest in the Sepik Special Economic Zone if there are no access roads/bridges, if there is no reliable power supply, if there is no reliable water supply, if there is no police presence to maintain law and order, if there are no schools, health centers and rural hospitals, if there are no banking and commercial facilities, if there is no pool of unskilled and semi- skilled workers and the list goes on. To create a conducive environment, the NEC approved a funding of K100 million of which only K50 million was appropriated in 2014 Budget Trust Instruments approved by the Minister for Finance. Signatories are myself as Secretary for DTCI, Finance Secretary Dr Ken Ngangan and his deputy secretary Steven Nukuitu. Vetting of expenditures is done by the Finance department. In 2016, K6million was released, giving a total of K56 million kina to date for the SEZ Project.
Which agencies were involved in getting this project off the ground?
I acknowledge the high level of support, cooperation and confidence displayed by the following stakeholders to make the investment environment at the SEZ very attractive:
Department of Agriculture and Livestock for availing the Urimo State land;
Department of Lands for registering the land and for issuance of titles for Hanawi land;
Works department through the provincial works manager and engineers for the all the roads works;
PNG Power for the running the three-phase lines to the sites at Urimo and will do the same for Hanawi;
Water PNG for the town water supply at Yangoru;
Police department for supporting the establishment of a mobile barracks;
Education department for partnering with the districts to upgrade and build new schools along the stretch of the zone;
Department of Health for partnering with the province and district to have the health facilities progressively developed and upgraded to meet the requirements of the potential workforce and their families within the SEZ.
As stated, why we have selected Yangoru Saussia for this SEZ project is because of the fact that there are more than 18, 000 hectares of State Land still lying idle. And still more than 500, 000 plus hectares of customary land is lying idle from East Sepik to West Sepik as well. Therefore the vision through the SEZ concept is for the Government to transform the vast idle savannah grasslands into a diversified agro development to produce mass outputs for the growing domestic and regional demand.
What are the enabling infrastructure projects?
They are:
Law and Order (including a barracks) K19 million;
Survey – land mobilisation K1.5m;
Roads built (150 kilometres) K20m;
Bridge K2 million;
School and health facilities K1.5m;
Power line (24kms) K4 million;
Water and Sanitation Upgrade host district headquarters K6 million.
What is the LR Group of Israel’s role in this?
The Hanawi land was surrendered to the State in 1972. It has been lying idle for nearly 43 years until this day the foundation investor sets foot on to make it the land of milk and honey. LR Group of Israel is bringing in its expertise in agriculture technology to be the first investor under the SEZ here to venture into stock feed and chicken production in partnership with Kumul Consolidated Holdings Limited. KCHL is a State-owned company representing the interest of the 8.8 million people of Papua New Guinea. The LR Group will also introduce the drip-feed technology to increase the yield of cocoa by four times. Over 40,000 hectares of customary surveyed and ILG (Incorporated land group) registration process will be undertaken on voluntary in the next six to 12 months.