Tonga Forest Products Limited, has been granted a new lease on life. After negotiations concluded between the Government of Tonga and a Maori Trust representing the interests of two significant Maori Iwis in New Zealand, the Trust has agreed to pay TOP $9,737,795.00 in return for the control and management of the company for 50 years, with the option to renew for a further 25 years. At the end of the term of the agreement, the Trust will return the assets and business to the Government, together with any new improvements or additional assets and businesses that the Trust has established during the term of the Agreement.
The Maori Trust has significant properties and investments throughout New Zealand. This is the Trust’s first investment in the Pacific. The Trust brings with it immense experience in the New Zealand forestry industry, with current exports to South-East Asia and China.
As part of the Agreement, the Trust will undertake an aggressive Replanting Scheme on the ‘Eua Forest Reserve, with a focus on the replanting of trees in the first 10 years. The Trust has undertaken to implement sustainable forest management and harvesting practices, in order to allow the trees at the ‘Eua Forest to regenerate and grow at sustainable rates.
The company will continue to employ at the least the same number of employees in Tonga Forest Products Limited, at the same or better remuneration. Those employees who will not continue their employment will be offered severance packages.
The Chief Executive Officer of Tonga Forest Products limited was excited about the potential growth of the company under the management of the Trust, and in particular the expertise which the Trust brings in the forestry industry. He saw the Agreement as an opportunity for employees in Tonga Forest Products Limited to learn from their New Zealand counterparts, and to build local capacity for the future.
The Board of Directors of Tonga Forest Products Limited are fully supportive of the Agreement between the Government of Tonga and the Trust.
The Government of Tonga and the Trust have agreed to rename the new entity as Aotearoa-Tonga Forest Products Limited. The new entity will be granted land leases over the ‘Eua Forest Reserve, Vaitaki Sawmilling Site and Mataliku Forest Plant.
Issued by the: Ministry of Public Enterprises