Fiji Water Full Press Release.
Press Release: Fiji Water
John Cochran, President and COO of FIJI Water
Los Angeles, California headquarters on November 28, 2010
In Friday’s budget (11.26.10), the Fiji Government announced that it will impose a 15-cent per liter tax on bottled water at locations where more than 3.5M liters per month are extracted. FIJI Water, which currently pays 1/3rd of a cent per liter, is the only bottled water producer in Fiji affected by the increased tax; bottlers who extract less than this monthly limit will continue to pay about 1/10th of a cent, or 10,000% less tax than FIJI Water.
This new tax is untenable and as a consequence, FIJI Water is left with no choice but to close our facility in Fiji, effective Monday Nov. 29, 2010. We are saddened that we have been forced to make a business decision that will result in hardship to hundreds of Fijians who will now be without work.
In addition, we will be putting on hold several large construction contracts in Fiji, including the renovation of the Drauniivi Primary School, a F$300,000 project and the resurfacing of the Naikabula Yard, worth F$1.6 million. FIJI Water will also be forced to cancel all contracted engineering and support services as well as our purchasing of cartons from Golden Manufacturers. Finally, all ongoing purchases from local suppliers will have to be canceled.
As a leading exporter, FIJI Water has contributed greatly to the Fijian economy. We represent more than F$130 million in export revenue for the country and employ nearly 400 Fijians at our facility. Our investment in Fiji has created millions of dollars in value through direct employment and with our supplier network. We currently pay millions of dollars in duties and income tax to the Government. We also contribute over F$1.8 million dollars annually in royalty payments to the Yaqara Pastoral Company Limited and another F$250,000 annually to a trust that supports the six local villages surrounding our facility.
In addition, our company and the FIJI Water Foundation have worked tirelessly to help improve the quality of life for the Fijian people, including an annual investment of F$1 million to bring clean water to local villages, improve education and provide access to health care services for those in need.
We consider the Government’s current action as a taking of our business, and one that sends a clear and unmistakable message to businesses operating in Fiji or looking to invest there: the country is increasingly unstable, and is becoming a very risky place in which to invest.
FIJI Water remains willing to work through this issue with the Fiji Government, as it would be our preference to keep operating in Fiji.
ENDS
Wow – Seems like something went terribly wrong in the relationship between Fiji Water and the Fijian government. It looks like all of the infrastructure, jobs and investment in the Fiji economy has become less important than that precious natural resource – quality water. I wonder if they’ll patch things up…
Closer to war over water?
Sounds like a high stake poker game – on the figures I have seen, but I am open to be corrected, Fiji Water has had a dream run financially and the business would still be highly profitable after the tax increase.
One that any astute businessman would be very happy to have, can I put my hand up?
Playing poker with Frank Bainimarama usually means you lose.
I worked for this business. They are ruthless. Throwing 400 people out of work in 2008 just prior to xmas and again doing it yesterday. Have they have no soul. The owners are billionaires and they claim they are on the island to support and help the local people, yet are prepared to put them through this pain. Fact of the matter is they are just corporate tigers who will rip anybody apart if it means profit.
1 Fijian dollar = $.53 USD. Of course they write the story to make themselves look like they donate more. I agree with Damian, they are ruthless, rich corporate tigers. I’ll admit, I love the water, but not the policies of the company.
The real story folks is that Fiji Water privatized the Fijians water supply and was selling it overseas making it harder and more expensive for the locals to have access to cheap, clean water. This is a good thing for the Fiji! Privatizing any natural resource is not sustainable because it propogates greed.