Fiji’s central geographic location on major trade routes, coupled with its strategic geological setting on the Pacific Rim of Fire, has historically attracted multinational exploration companies to invest and prospect for potential mineral deposits.
The Fijian Government recognises that foreign imports will play a major role in Fiji’s growth, and for this reason has actively sort ways to improve the investment climate for foreign investors, as well as local entrepreneurs. The Government will encourage any project found suitable for location in Fiji, subject to the investment:
- Contributing to Fiji’s economic and social development
- Broadening Fiji’s economic base
- Providing opportunities for significant local equity participation, particularly in projects that involve the utilisation of the country’s natural resources, possibly through joint ventures
- Generating increased exports
- Providing training and employment opportunities for local people
- Involving maximum processing of products in Fiji
- Involving the enterprise in the provision of maximum common-use facilities, such as labour and roads
Specific requirements for foreign investors include:
- Introducing adequate funds for proposed projects, with a debt to equity ratio of no greater than 3:1
- Paying a fair price for assets acquired locally
- Obtaining approval to remit dividends and profits from the Reserve Bank of Fiji for tax clearance and statistical purposes
- Obtaining Exchange Control approval from the Reserve Bank of Fiji for any investment in Fiji securities
- Obtaining work permits for expatriates and, wherever possible, train local employees to fill their positions.
There is no restriction on foreign investors acquiring a controlling interest in locally owned existing businesses in Fiji, however there is a limited list of areas restricted to local investors only, which is currently under review. Essentially, the restrictions/conditions for investment are designed to ensure that only those investments that are economically and developmentally desirable for Fiji proceed.
Investment in the Mineral Sector
Foreign investors are most attracted to countries with an open exploration administration system where the rights of investors to develop their discoveries (or continue with promising exploration prospects) are clear. In Fiji the investor’s right to continue exploration / development programs is written in the Mining Act.
The guiding principle of Fiji’s mineral investment policy is that Government assumes that the grant of an exploration licence implies a right to proceed to eventual project development, subject to the licence holder maintaining a vigorous geological and/or feasibility study program approved by the Minister responsible for Mineral Resources.
Investors Rights and Guarantees
The Government of Fiji is aware of the risks that mineral exploration and development companies take, and sees a role for itself in creating an investment climate in Fiji which offers investors security. The 1990 Constitution of Fiji provides a first stage guarantee for investors, in Section 9 against the compulsory acquisition of property (including mining tenements) except (and only with an order authorised by the Supreme Court) in certain specified condition spelt out in the Constitution.
In addition, Fiji is a signatory of the Multilateral Investment Guarantee Agency (MIGA). MIGA is an independent agency of the World Bank mandated to help facilitate increased flows of foreign direct investment to developing countries. Its core area of business is providing political risk insurance to foreign investors; available risk coverage includes war and civil disturbance, currency transfer/inconvertibility, expropriation and breach of contract. Plus Fiji is a member of the International Chamber of Commerce, and the International Centre for Settlement of Investment Disputes.
Source: Minerals Sector Guide, Fiji Minerals Resources Department. Ministry of Lands and Mineral Resources