Islands Business - We Say: BETTER BUSINESS IN THE REGION

‘The small and medium sector is increasingly proving vital to economies of not just the developing world but also developed countries. This is a sector that needs the most encouragement.'

The PIPSO (Pacific Islands Private Sector Organisation) inaugural convention in Nadi last month discussed and debated on a whole range of issues faced by the private sector in the Pacific Islands region. It was undoubtedly a much needed exercise in bringing together people from different levels of the business world on a single platform to collectively deal with the problems faced by it.

At the end of the two-day deliberations, PIPSO has taken upon itself to address the one big shortcoming that business councils have left: intensely following up with governments—both at national—and regional levels on a regular basis, in a sustained manner, hopefully leading to positive policy changes to facilitate better business in the region.

The small and medium sector needs the most encouragement. Pic: Dev Nadkarni

Business councils have discussed and deliberated pretty much the same matters for years at their annual conventions that are invariably attended by ministers and senior government bureaucrats—but have achieved little. That is mainly because after the meetings and the bonhomie following drinks, dinners and the customary rounds of golf, there is no dedicated mechanism to follow up until the next meeting the following year. Effectively, therefore, such meets have ended up being mere talkfests.

PIPSO plans to do exactly that with the help of its secretariat. But will it succeed? That question was not convincingly answered at the end of the meet —quite simply because that big question is related to funding.

This first initiative reportedly had a budget of a couple of hundred thousand dollars. It was therefore no surprise to see a full house at the convention with most businesspeople from around the region having been flown in—and their accommodations paid for—with donor funds. It is never a difficult task at any rate to fill up a convention when there is some donor organisation to pick up the tab.

The United Nations Development Programme that was the major sponsor for the event made it clear it did not have a mandate to fund PIPSO on an ongoing basis. That was announced at the beginning of an address by UNDP’s Suva-based regional director Richard Dictus.

At the time of the convention, PIPSO said it just had enough funds to run its secretariat only until the end of September and it did not have a clear plan on how it would go about keeping both the secretariat and itself afloat in the crucial phase of the fledgling organisation’s very crucial baby steps.

It plans to approach other institutional and corporate sponsors and hopes advertising and membership on its website would help shore up funds for a corpus. The managements of business councils everywhere know how difficult it is to raise funds—even if it is collecting annual membership fees. That task would be doubly difficult and expensive in the islands given the ground realities in the region.

But will membership fees and website advertising be enough? Already, it is beginning to look like a large chunk of PIPSO’s time and efforts would be consumed in finding funds to stay afloat than promoting the private sector.

Speaking of corporate sponsors, Fiji’s biggest companies—several who have region-wide operations and have successfully overcome many of the problems facing businesses in the region—were conspicuous by their absence at the meet. Had they participated and were given a chance to interact with delegates, their inputs and mentoring would have been invaluable for inexperienced entrepreneurs who were flown in from around the region.

Among PIPSO’s immediate plans are to organise a similar meet for the SMME (Small Medium and Micro Enterprises) sector. It plans to host it some time early next year and it is hoped it will find the resources to host such a meet. In the absence of resources of the scale that funded the first meet, small businesspeople would find it daunting to participate in the event.

The small and medium sector is increasingly proving vital to economies of not just the developing world but also developed countries. That is a sector that needs the most encouragement.

Governments in the region have continually failed the sector. An appalling instance of such government apathy was the complete ignorance of regional trade agreements admitted by businesspeople from the Northern Pacific.

Despite exporting and importing merchandise all across the region and to and from Australia and New Zealand for nearly a decade, they said they had never known about Cotonou, PACER and SPARTECA agreements until they heard them discussed at the Nadi conference. PIPSO’s well thought-out web initiative would probably address that and the general lack of information resources for businesspersons effectively.

In fact, given the huge costs of travel in the region, PIPSO must channel its resources into information organisation on its website and its effective dissemination, build forums and interface businesspeople with government officials in an interactive manner online, rather than spend on mega jamborees.

This focus on PIPSO’s funding challenges is not to take away anything from its excellent aims and intentions for the region’s private sector. An initiative like PIPSO deserves every encouragement and help.

Rather than placing its hopes solely on institutional monetary support in the short to medium term, PIPSO must do everything it can to secure the financial support of national governments with help from the Forum Secretariat since the private sector has been identified as one of the main drivers of economic growth in the Pacific Plan.

The islands governments must help set up a seed fund for an organisation like PIPSO until it is able to grow financially strong enough to sustain itself. In the absence of such a collective governmental initiative, the newly hatched organisation will be preoccupied about its own survival rather than concentrate on the many tasks and goals it has set itself.