18 Jun 2013

Vanuatu government denies it is running out of copra subsidy funds

3:08 pm on 18 June 2013

The Vanuatu government denies it is running out of copra subsidies for its companies amid claims that it owes huge sums.

The Vanuatu Daily Post reports some companies are owed $750,000 US dollars in subsidies, and are considering legal action.

But the Commerce Minister, Marcellino Pipite, denies that figure and says he has $400,000 US dollars left, which is enough to pay what is owed.

Under the current system, buyers pay a minimum rate to farmers and the government will reimburse them with a subsidy, depending on fluctuations.

The government has again raised the minimum price of copra to avoid having to pay subsidies.

Mr Pipite says the minimum price of copra will go from 318 to 370 US dollars a tonne in August, and until then, there are sufficient funds for subsidies.

"There is no such amount. I have some monies outstanding with me, but as any company, we manage. We will sort out these outstandings as I know, but not what they claim."

Marcellino Pipite says the complaints are from one buyer who is flauting the legal price for copra and purchasing for as low as 65 US dollars a tonne.