Struggling businesses get S.A.M.E. support

By Sapeer Mayron 12 April 2020, 6:00AM

The Samoa Association of Manufacturers and Exporters (S.A.M.E.) has devised its own rescue package for its members in the wake of mass redundancies and revenue losses resulting from the COVID-19 pandemic and subsequent economic crisis.

With the Government stimulus package appearing not to cater to the nearly 80 businesses focused on manufacturing and exporting Samoan goods, Chairperson Tagaloa Eddie Wilson is prepared to work for his membership alone. 

The package includes developing more access to markets both local and international via the online marketplace, 

In a survey of its membership, Tagaloa found 66 per cent of respondents (around half its members) reported a loss in sales of between 50 and 70 per cent.

“The message is really clear,” he said.

“Our members are not asking for handouts, they need help to stand on their own two feet and be able to compete with imported products. 

The Ministry of Finance revealed its Supplementary Budget, its national response package to the COVID-19 pandemic, on Tuesday last week in Parliament.

It is worth $66.3 million tala and Finance Minister Sili Epa Tuioti expects it to push economic growth from its anticipated -2.2 per cent growth to just -1.6 per cent.

Tagaloa describes the budget as one based on ability to deliver.

“The government itself is in a very difficult situation just like the private sector, there is no revenue. 

“We are being realistic by saying we are not waiting for a handout, we are helping ourselves and working together.

“Really, if Samoa wants a stimulus package to stand on its own two feet, let’s help each other, buy Samoan made goods and services.”

S.A.M.E. has prepared a Stimulus Package for its members focused on capacity building, and access to markets and access to finance. 

There is a significant focus on improving the Buy Samoa Made model, including trade shows and representatives overseas and online as well as bolstering that same model here in Samoa. 

“We want our local businesses to increase and support locally made products.

“Then we will look at more aggressive measures to get the Buy Samoa Made brand to smaller regional export shows in the Pacific, New Zealand and Australia.”

He wants Samoa’s own Government to be party to this too, by engaging the diplomatic missions abroad to help the private sector seek out markets and businesses opportunities.

“It’s not going to cost the Government any extra money, it’s just common-sense and being more innovative.”

But getting online and out of Samoa means helping members get more tech and internet savvy to be able to promote their products on their own. 

Tagaloa said their negotiations with commercial banks have been successful, with the banks being “forthcoming” and helping to provide loan repayment holidays, or restructuring loan arrangements to help provide more finance.

There is also a renewed push to negotiate a concessionary finance tool with Government to help local exporters make their start.

“The only we can help our members get on their feet is to help them access more markets and online selling, and accessing finance and build their capacity to continue business,” he said.

A major concern reflected in the S.A.M.E. membership survey is a need to have tariffs straightened out and in many cases the demand is to have import and export tariffs reduced significantly.

“There are still some anomalies in the tariff system in the Government,” Tagaloa said. Nearly a third of respondents want tariffs on raw materials removed. 

Among the exporters in the association, 86 per cent reported a reduction in their exports of more than 50 per cent. 

Supplies are short too. Just over half of respondents said they are not getting just half of their supply requirements imported for their value addition manufacturing work, because of less sea freight and next to no air freight.

The Ministry of Foreign Affairs asked S.A.M.E. to what extent businesses are suffering due to the halt on air freight with Samoa’s borders closed to planes.

At least 30 companies are unable to get what they need, when they need it by depending only on sea freight, they reported. 

“The air freight supplies are crucial at times, and there is a need to look at air cargo,” Tagaloa said.

“The lockdown is something nobody will argue about, it’s something we appreciate Government’s prompt response.”

Asked what assistance they need to get through this economic downturn, 60 per cent of members report to want loan repayment suspensions or to pay interest only on their loans for a spell, and 50 per cent want additional financial facilities like overdrafts.

Tagaloa said without working capital the economy will not restart, and loans repayments will have to wait.

Over half of the respondents have also said they want to invest more in e-commerce and getting their business online in the wake of the pandemic. 

Staffing has proven to be challenging despite many member’s best efforts to keep their teams on board. Over 60 per cent of members have laid off between one and five employees in their businesses, Tagaloa said.

However 30 per cent are helping their staff with monetary assistance, providing transport and food to get by. 

“I don’t want to give false hope to the members,” Tagaloa admitted.

“My message is let’s not wait for a handout, let’s help ourselves. 

“Make better products, be more innovative, increase production and we will look for markets for you, we will talk to the banks about improving interest rates, we will talk to the Government about removing tariffs.

“On the other side of the coin we want to work with the Chamber of Commerce and Industry to support Buy Samoa Made and its products.”

By Sapeer Mayron 12 April 2020, 6:00AM

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