Govt backs revival of Waghi Mek

Agriculture and Livestock Minister John Simon says to revive Waghi Mek to its former glory, after 23 years of closure, will need a minimum of K10 million.

By MALUM NALU
AS you drive along the great Waghi Valley of Jiwaka, one of the agriculture hubs of Papua New Guinea, you see a heart-breaking sight.
Miles and miles of once-flourishing coffee plantations covered by bush or taken over by settlers.
These are the sad remains of Wahgi Mek Plantations, which from 1973 to 1999, generated millions of kina in export revenue for the country.
It goes without saying that PNG’s declining coffee production has been largely due to the collapse of the 14 Wahgi Mek Plantations.
I try to imagine what the economy of the country would be like now if these iconic plantations are still producing coffee today.
This is the scenario as I travel to Banz, Jiwaka, with Agriculture and Livestock Minister John Simon last Friday (Feb 4) to meet with shareholders of Wahgi Mek.
Reviving the once-great coffee plantations of PNG, like Wahgi Mek, is what Prime Minister James Marape and his ruling Pangu Pati have often talked about.
At the meeting, Minister Simon says it is in the best interests of Jiwaka and Papua New Guinea that the rundown Wahgi Mek Plantations are revived.
He says the Marape Government is willing to help revive the plantations with financial support, however, a proper work programme must be in place.
Jiwaka Governor Dr William Tongamp is also present at the meeting.
Wahgi Mek Ltd, owned by South Wahgi LLG, North Wahgi LLG and Hunter Richard Hagon, was once the single biggest coffee exporter in the country until it ceased operations due to landowner disputes.
Many attempts
There have been many attempts to revive the 14 plantations but to no avail.
“We all know very well that the economy of Jiwaka is dependent on coffee,” Minister Simon says.
“The biggest coffee gardens to restore our Jiwaka economy are the Wahgi Mek plantations.
“It is in the interests of everyone that Wahgi Mek is revived.
“Our national coffee production is dropping, and one of the contributing factors to that, is Wahgi Mek Plantations not producing.
“The big coffee plantations in the Wahgi Valley like Wahgi Mek, Gumanch and others need to be revived.
“What has happened to Wahgi Mek Plantations is a very sad story.”
Minister Simon says leadership is critical to revive Wahgi Mek Plantations, especially at a time like now, when people are better educated than in the past.
“The problem now with reviving plantations like Wahgi Mek is that everyone wants to be a leader, and at the end of the day, nothing gets done,” he adds.
“Let’s do something, let’s do it now. If our heart is in the right place, what we are trying to do will happen.”
Minister Simon says a start can be made by reviving one plantation first, and then move on to the others, rather than try to revive all of them at the same time.
He says the onus is on everyone to work together, especially the two LLGs and Jiwaka Provincial Government, to revive the Wahgi Mek Plantations.
The story of the rise and fall of Wahgi Mek Plantations is a fascinating one which would fill volumes.
In a nutshell, it starts in 1973, when Wahgi Local Government Council (LGC) bought Kilip Coffee Plantation from Robert Rutledge.
Impressive expansion
That opens the floodgates as Wahgi LGG goes on an impressive buying spree:
·  1974: Buys existing Warakar and Banz coffee plantations from Commonwealth Bank of Australia;
·  1974: Buys Wagmil Coffee Plantation near Kudjip from Bank of New South Wales;
·   1975: Buys Jimbina Plantation from Laurence Thomas Nollen;
·  1975: Buys Karmang Plantation from Bank of New South Wales;
· 1976: Buys 25 per cent shares in Banz Kunai Hotel;
·  1976: Buys Talu Group of Companies from David Farquhar Folkner;
·  1976: Buys Wara Wahgi Plantation from Anna and Brian Ragget;
·   1976: Buys Damne West Plantation from Nole Lutledge;
·   1976:  Buys Banz Butchery from Robbie Bucknell.
The big breakthrough came on March 12, 1976, when Wahgi Mek Plantations Pty Ltd was formed and registered as a coffee-growing, processing and exporting company.
All businesses and assets of Waghi LGC were transferred under this company.
Waghi LGC owned 100 per cent of the new company.
The growth of the company continues:
·  1976:  Buys Karmal (Binz Nol) Plantation from Brian Allan Pile of Mintal Plantation;
·  1977: Buys Mangara Plantation (Portion 73) from Bank of New South Wales;
·  1978: Buys Mangara Plantation (Portion 74) from Robin Hendry;
· 1979: Buys Wahgi Valley Plantation from Allan Cambell Hartley and Gina Valaria Hartley.
· 1979: Buys Mangara (Portion 158) from PNG Development Bank.
In 1980, Waghi Mek Plantations Ltd had K1 million in interest bearing deposits in the National Bank of Australia, and 1028 hectares of coffee all on State Lease, fully-titled land.
In North Waghi, it owned Talu (61.2 ha), Karmal (78.8 ha), Karmang (50 ha), Kilip (19.6 ha), Wara Kar (81.2 ha), Anye (Sigiri) (36.4 ha) and Wahgi Valley (19.4 ha) plantations.
In th Waghi, it owned Damne (44.7 ha), Wagmil Main (167.5 ha), Wagmil Extension (62.9 ha), Jimbina (104.4 ha), Mangara, (180 ha) and Mangara 2 (122 ha) plantations.
In 1982, Waghi LCG split into North and South Waghi Local Level Governments (LLG).
Shareholding of Waghi Mek Plantations Ltd was also split into 50 per cent each.
In 1984, Wahgi Mek declared a profit and paid dividends of K 70,000 (K35,000 each) to the two shareholders.
Soon after Waghi Mek went into cash flow problems.
The National Government gave the guarantee and Waghi Mek borrowed K2 million from Bank South Pacific.
In 1986, Hunter Richard (Dick) Hagon was brought in to manage Waghi Mek as part of loan condition, his main task being: “Properly manage Waghi Mek, retire the outstanding loan and return the company back to the original shareholders.”
Agriculture and Resource Management Services Ltd (Arms), owned by Hagon, was given 25 per cent nominal share of Wahgi Mek as part of the loan condition. North and South Wahgi LLGs retained 37.5 per cent shareholding each.
Bank mortgage
All of the Wahgi Mek Plantations were mortgaged to BSP to secure a loan.
That was the beginning of the end of Waghi Mek’s dream run as it went from one controversy to another over the next 10 years.
In 1999, Wahgi Mek completely collapsed, with mass vandalism of Talu wet and dry coffee factory worth more than K 4.5 million.
Wahgi Mek stopped operations.
Minister Simon says to revive Wahgi Mek to its former glory, after 23 years of closure, will need a minimum of K10 million.
“The Marape Pangu Government is all about rural empowerment and building a sustainable agriculture sector, and we are doing what successive governments failed to implement,” he adds.
“I encourage Wahgi Mek to work with the Government, through Coffee Industry Corporation, to access Government funding.
“The company must also seek funding from financial institutions such as Bank South Pacific and National Development Bank.
“The plantations, once revived, will bring in much-needed foreign exchange for PNG.
“The Government, through CIC, will work in partnership with Jiwaka Provincial Government to revive the plantations with each party making a contribution of K1 million.
“The revival of Wahgi Mek Plantations marks the start of rehabilitation of major coffee and cocoa plantations all over PNG.
“We are also looking at trialing labor mobility programmes, where we utilise our local people on plantations, which will generate a healthy cash flow and improve rural economies nationwide.”

• Malum Nalu works with the Office of the Prime Minister