Only foreign investors get S.N.P.F.’s attention?
Well, it looks as if that nasty debate about whether or not the Samoan government is “broke”, is becoming more and more interesting – or is it more and more nerve-racking – so that we should keep on hoping it will not all of a sudden, blow up in someone’s face.
I guess it all began when the Samoa Bureau of Statistics Quarterly Report for the year 2016, disclosed that the Samoan government’s debt had remained at $1.1 billion for that year.
And then sometime later when that report somehow found itself in the possession of the Samoa Observer, the paper went ahead and published it in its edition of 13 April 2017, and that was when the real fear started to show up.
It did with the nagging worry that the government of Prime Minister, Tuilaepa Sailele Malielegoai, had clocked up a debt totaling $1.1 billion, and then came the questions: Who is going to pay for this debt? The taxpayers?
Now the very poignant worries, are: How were the government Laui’a able to allow themselves to accumulate such a debt in a country where the majority live in near-squalor out there in the villages, they are predominantly unemployed, they are therefore constantly worried about not having adequate access to those basic necessities such as clean water, reliable electricity, decent food for their families, and indeed school fees for their children?
Still, the reports that the Samoan government is “broke” as a result of the debts it has been accumulating, as the Samoa Bureau of Statistics reports for 2016 have shown, were such a worry so that the Minister of Finance, Sili Epa Tuioti, was asked for a comment.
In response, he dismissed worries that the government was struggling through financial difficulties, saying simply: “The government is not broke.”
Published in the Sunday Samoan on 30 April 2017, his denial was contained in the story titled: “Is the govt. broke? Minister says no.”
In that story however, he went on to dismiss worries that the country was in trouble, and instead insisted that “the government is not broke.”
And then the very next day, a new story titled “Finance Minister clarifies S.N.P.F. loans criteria”, was also published in the Samoa Observer.
And with it, a new quandary in the nasty debate as to whether or not the Samoan government, lorded over by Prime Minister Tuilaepa Sailele Malielegaoi, is “broke”, emerged.
And how did it emerge?
It did when the Minister of Finance, Sili Epa Tuioti, instead of continuing to deny that the Samoan government was “broke” as he’d been insisting in the past, is now saying there are flaws with the way foreign investments are being handled which, in his opinion, simply have got to be addressed.
To begin with, he said foreign investors should bring their own capital when they come to Samoa because that’s one of the benefits of encouraging foreign investment.
He’s probably right.
Still, his opinion was sought as a result of much public criticism that had been made against the S.N.P.F., for allowing loans to foreign-owned companies.
Coin Save, a company with Chinese ownership, is apparently one of them.
The story says that S.N.P.F. had lent Coin Save $5 million, to help it turn the near-defunct Vaitele Market, into a profitable enterprise.
Now the question is: As a foreigner investor, why didn’t Coin Save’s Chinese owner use his own money as his investment in the project, instead of depending on S.N.P.F. to finance it?
Indeed, don’t the government and Minister of Finance, Sili Epa Tuioti, know that there are many Samoans out there who have great ideas they’re aching to see developed into successful businesses, but then their problem is that they also know they just do not have the sort of guarantee for the sort of loans they need?
We don’t know.
All we know is that it looks as if as far as the Minister of Finance is concerned, as long as S.N.P.F. has millions of Tala stashed away that it can lend, it should continue to lend it to foreign investors.
Never for those seemingly enterprising local entrepreneurs and would-be investors who have the will and the gift, but lack the financial backing they need.
But then why is this?
Because according to him, only the foreign investors are the ones who “bring the expertise, and whatever knowledge to our people.”
Indeed, he told the Samoa Observer: “Yes, we do expect investors to come in and bring the capital with them.
“And as the government, we provide incentives like tax holidays, we give them duty concessions on building materials, construction materials and some of consumer cost for a limited period.”
“But you would expect investors to bring in the bulk of the capital needed so they don’t have to borrow from our banking sector.
“Once they are doing well, and they need further working capital, short term working capital and once they’ve proven themselves, that would be an opportunity for our banking and financial institutions to be able to lend to them.
“So if they’re not bringing the money in then obviously they should not be called investors.”
So what should they be called?
He didn’t say.
All he said was that “lending is an essential part of S.N.P.F.’s operations, because it’s through interest, that we are able to add on to the value of our contributions.”
He also said: “But I take the point that when foreign investors come here, whether they are Asian, European, Australian or New Zealanders, our expectation is that they will bring in the capital themselves.”
Still, the Minister of Finance, Sili Epa Tuioti, is pretty sure about one thing. And that is, the S.N.P.F. should remain the government’s dual purpose machine, and that is to say in one end it is accumulating millions of Tala it is stashing away in the safe, and at the end it is pilfering away the same millions and yet not one person in there, is raising a voice in complaint.
And lastly, Minister of Finance, Sili Epa Tuioti, insists that due diligence process is of the utmost importance in this kind of business; we cannot doubt that.
He said: “So whether we lend to foreign people or locals, S.N.P.F. needs to make sure as part of their due diligence process, that it’s a credible business - that it has a business license and has met all the other requirements.
“That includes paying the S.N.P.F. contributions for their employees, and ensuring they also have the cash flow to be able to service the loan.”
And so, when S.N.P.F. has agreed to give you that loan, you make sure you that you have that due diligence process of yours, done.