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Pacific Islands Development Program, East-West Center

With Support From Center for Pacific Islands Studies, University of Hawai‘i

Samoa Government To Bolster Private Sector Development
Private sector hindered by high operational costs, little-used support

By Kolotita Talatalaga

APIA, Samoa (Samoa Observer, Nov. 27, 2012) – The government still plays too large a role in the economy and raises the costs of doing business; commercial law reform is incomplete; the financial market is "thin" and the cost of finance in Samoa is high.

These are some of the challenges Samoa’s private sector faces, according to the CEO of the Ministry of Commerce, Industry and Labour (MCIL), Auelua Taito Samuelu Enari.

Auelua further expanded on these comments in his presentation at the Leadership Samoa’s Economic and Private Sector Seminar on Friday.

"In any country in the world, whenever there is a problem in the private sector, government has to receive the rough end of the whip from the public, and private sector representative institutions," Auelua said.

In response to these challenges Samoa’s private sector faces, Auelua said the government has undertaken a number of initiatives.

These initiatives include a Personal Property Securities Bill, aimed to increase economic activity in Samoa by making it easier and less expensive to obtain credit, on-line E-registry for companies and ongoing awareness programs.

In his presentation, Auelua said Samoa’s position in the world has improved by ten steps – from position sixty seven in 2010 to fifty seven in the recent report out of 188 countries reviewed.

This progress has been made within a period of two years and Auelua said it has given MCIL "motivation to strive even harder in improving service delivery, while aspiring for Samoa’s improved ranking as the best location for establishment and running a business in the long-run."

MCIL facilitates a number of programs targeted towards the development of the private sector.

However, Auelua said ‘limited private sector development’ is one of the weaknesses challenging the strengths in private sector development.

"Samoa’s private sector remains weak and Foreign Direct Investment has not increased as expected. Maximizing the contribution of Samoa’s private sector in terms of employment, export earnings, and tax revenues is currently impeded by several key constraints including high costs of doing business and scarcely utilized business development services."

Another weakness is the lack of awareness among most of the businesses of ‘Existing Support Programs.’

"There seems to be a major deficiency in terms of public awareness among consumers and the business community regarding support schemes. Many businesses fail to take advantage of existing support schemes," Auelua said.

As a way forward, Auelua said MCIL have documented what they intend to do for the period of 2012 to 2016 in certain key Ministry documents.

The Trade, Commerce and Manufacturing Sector Plan provides and encourages a coordinated approach between the Ministry and private sector.

The sector plan projects further domestic economic reform designed to boost the productivity and international competitiveness of Samoa business.

More importantly, the plan sets out strategies and interventions that will also drive development in the private sector.

Auelua said it is expected that both parties including other stakeholders are "proactive during the actual implementation of the planned activities under the plan."

In addition to the sector plan, there is the ‘Corporate Plan 2012-2016 (CP).’

The CP sets the direction and strategies necessary for the achievement of targeted outputs for the planned period.

Auelua said the government will continue to undertake a facilitating role to ensure a beneficial environment for the private sector.

"This will be through the continued provision of policy which is conducive, institutional and regulatory framework; encouraging public and private partnership," he said.

"We will also facilitate the implementation of domestic policies with a view of stimulating production and value addition, and pursuit of outward oriented policies that encourage foreign investments and exports."

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