A Maori trust from New Zealand has secured rights to operate and control the Tonga Forest Products Limited for at least 50 years.
The new company will be known as Aotearoa-Tonga Forest Products Limited.
It will take control of the ‘Eua Forest Reserve, Vaitaki Sawmilling Site and Mataliku Forest Plant.
The Tongan government said “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.
This was the first time the trust invested in the Pacific it said.
The Trust will conduct replanting scheme at ‘Eua Forest Reserve in the first 10 years.
The current employees at the Tongan company will still be employed by the Trust and for those who wanted to leave 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.