Samoa is making progress in developing dried organic banana exports to New Zealand. This forms part of a wider range of organic fruits which Samoa could potentially export to New Zealand. Currently only a small number of Samoa’s nearly 400 certified small organic growers are involved in the export trade, but since the first shipment of organic dried banana, such exports have been well received. Exports are supported by a joint initiative between Women in Business Development, Oxfam New Zealand and All Good Organics. Potentially certified growers would have an export outlet for their production through this initiative.
Given the transport cost disadvantages that Pacific Island states face when engaging in international agricultural trade, the targeting of premium-priced markets for exotic products with a high value-to-weight ratio represents one of the most viable options for expanding international trade. However this tends to be an extremely marketing-intensive activity, which faces serious constraints in economies of scale at the outset. ‘Aid for trade’ initiatives can play an important role in overcoming these initial high marketing costs by allocating ‘pump-priming’ funds to trade initiatives.
This initiative highlights a challenging new trend towards the development of value-added and niche market exports. This is in response to earlier problems in getting fresh products to market in an appropriate state (e.g. fresh bananas were delivered discoloured, and hence were rejected by customers).
The Samoan joint venture seeks to build on the network of cooperative small and medium enterprises in Samoa, exports of certified organic products (e.g. virgin coconut oil to the Body Shop international beauty products enterprise), and the involvement of an agricultural trade business partner who has known Samoa for 20 years. The joint venture has started small, with 20 selected organic producers, but aims to expand the range of producers involved in the export trade based on market demand. This would enable both limited economies of scale to be gained, as well as ensuring the reliability and sustainability of supply.
At the marketing level, the proximity to the market, its size and relative trade situation to Samoa, and the specificities of the product – its sustainability and speciality – were factored into decision-making. The decision to launch the product when the Pacific Forum Leaders were meeting in Auckland only underlines the entrepreneurial spirit that has driven this new venture.
The new product benefits from the duty-free, quota-free provision of the SPARTECA, a non-reciprocal preferential trade arrangement between the 14 Pacific ACP countries, Australia and New Zealand. This is symptomatic of the continued utility of such non-reciprocal trade arrangements. However, as observed by the President of the Samoa Association of Manufacturers and Exporters at a Pacific Islands Private Sector Organisation (PIPSO) meeting, similar initiatives have been launched in the past targeting neighbouring regional markets under the PICTA trading initiative, but these have often met with failure. Guarded optimism therefore appears to be the order of the day.