Minister of Trade, Tourism, Commerce and Ni-Vanuatu Business, James Bule has reaffirmed the Vt300 million subsidy approved by the Council of Ministers (CoM) — Vt150 million for Commodities and Vt150 million for copra.
“In order to contribute to the recovery of the people’s livelihood from the disasters caused by Tropical Cyclone Harold and the closure of borders due to COVID-19, the government through the Council of Ministers, has for the first time allocated Vt150 million as subsidy to support the purchasing price of commodities such as kava, coffee, cocoa, taro, manioc, am and sweet potatoes,” Minister Bule stated.
He said more details on how buyers/exporters and farmers can access and benefit from this subsidy will be publicly communicated by Department of Industry officers shortly.
The government also recognises that copra export has dropped due to the current low international price of copra.
Copra in Vanuatu is presently one of the main sources of revenue for a large number of the population, and has always been a major contributor to the country’s economic growth.
In addition to the negative effects caused to the economy by the closure of borders due to the COVID-19 pandemic, cyclone Harold in April 2020 has mainly damaged the islands where most coconut plantations are located, hence extremely affecting the livelihood of the coconut planters.
As a result of the occurrence of both TC Harold and the CIOVID-19 pandemic, the Ministry of Trade is glad to announce that the CoM has approved, with CoM no.145, the introduction of a Vt150 million subsidy to support copra price.
“This is part of the Government’s commitment towards copra farmers and their families, and the Commodity Support Scheme as an integral part of the overall Economic Stimulus package,” Minister Bule stated.
“The copra subsidy will follow the same process as the past copra subsidy that ended in May 2020. In practice, farmers will sell their copra to buyers and buyers will raise their prices by the amount of the subsidy.
“The amount of the subsidy is up to Vt10,000 per tonne of copra. However, the subsidised price is capped at Vt40,000 per tonne of copra.
“For example, if the buyer purchases copra at Vt25,000 per tonne of copra, the government will add Vt10,000 to it, making the subsidised disbursed to the farmer equal to Vt35,000 per tonne. If, however, the buyer purchases copra at Vt35,000 per tonne of copra, the government will Vt5,000 to it, making the subsidised price disbursed to the farmer equal to Vt40,000 per tonne of copra.
“The copra subsidy will last either until funding exhaustion or until the international price for copra is maintained at a level that is deemed good enough for buyers to set their prices without the subsidy at Vt40,000 or above.”
The Minister added the Copra Subsidy Taskforce, composed by representatives from the Department of Industry, the Trade Development Division, and the Ministry of Finance and Economic Management, will supervise the scheme and regularly check the international copra price.
Officials from the Ministry of Trade and the Ministry of Finance have dealt with the paperwork to start the scheme at the beginning of this week and copra buyers have embarked on purchasing copra at the subsidised price.