Tongan forestry deal centres on controversial businessman; PM laments lack of due diligence

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The Tongan government has signed a multi-million dollar deal with a New Zealand iwi headed by a businessman the High Court said had committed a fraudulent breach of trust just three years ago.

As Kaniva News reported last month, the deal means the  North Island iwi, Tahu Whaoa, will  take control of the government-owned Tonga Forest Products Ltd for at least 50 years, with an option to extend the agreement for another 25.

The iwi is headed by Roger Pikia, who, the New Zealand High Court heard, took $438,000 out of his grandmother’s account without her permission to buy a pig farm.

Justice Geoffrey Venning described Pikia as “an unconvincing witness” and ordered him to return the land and pay back moneys that were owed.

Pikia is also at the centre of a battle with members of another Maori group over the financial management of the Te Arawa River Iwi Trust, which will get tens of millions of dollars of taxpayer funding over the next two decades.

The trust is chaired by Pikia.

Roger
Roger Pikia. Photo/One News

The Te Arawa leaders have told the New Zealand government  they believe there are potential conflicts of interest with the trust and Pikia’s personal business dealings.

An investigation by Radio New Zealand and TV3’s The Hui appeared to show that the River Trust’s investment arm had invested more than $770,000 in a private company of which Pikia was a director.

The company which owns the Tongan forest shares, Ngati Tahu Ngati Whaoa Runanga Ltd, is registered in Vanuatu, a well-known tax haven.

Tongan Prime Minister ‘Akilisi Pohiva, who is visiting New Zealand, said he was disappointed more due diligence had not been done by his Government before the deal was signed.

He said he would raise the issue with Cabinet when he returned to Tonga.

However, a statement from the Tongan Ministry of Private Enterprise said Tonga Forest Products Ltd, had been granted “a new lease on life.”

The statement said that at the end of the term of the agreement, the Trust would return the assets and business to the Government, together with any new improvements or additional assets and businesses that had been established during the term of the Agreement.

Public Enterprise Minister, Hon. Poasi Tei, told the Tongan Parliament Tonga Forest Products Ltd,  was recently given more than $400,000 to prop it up. It had also borrowed millions from the Tonga Development Bank.

Radio New Zealand reported last month that Ngati Tahu Ngati Whaoa Runanga Ltd had agreed to pay more than US$4.4 million for management rights.

One News reported this week that the  Maori investors had taken responsibility for a $NZ2.6 million government debt and had agreed to pay $NZ3.5 million in return for the control and management of the forest company for 50 years.

The privately managed company will operate as Aotearoa-Tonga Forest Products Limited with leases over the 700 acre ‘Eua Forest Reserve, Vaitaki Sawmilling Site and Mataliku Forest Plant.

At last month’s ceremony to sign over the forestry group, Pikia said Aotearoa-Tonga Forest Products would launch “a very aggressive replanting programme in Eua” in the coming months.

“I have spoken to the Minister from Eua and asked him to ensure that everyone who is employable on Eua will come to work for the company to replant the island,” he said.

The main points

  • The Tongan government has signed a multi-million dollar forestry deal with a New Zealand iwi headed by a businessman the High Court said had committed a fraudulent breach of trust just three years ago.
  • The man, Roger Pikia is also at the centre of a battle with members of another Maori group over the financial management of the Te Arawa River Iwi Trust.
  • Tongan Prime Minister ‘Akilisi Pohiva said he was disappointed more due diligence had not been done before the deal was signed.
  • However, the Tongan Ministry of Private Enterprise said Tonga Forest Products Ltd had been granted “a new lease on life.”

For more information

Maori trust to own Tonga forests, company renamed as Aotearoa-Tonga Forest (Kaniva News)

Tonga forestry deal with North Island iwi causes growing concern (One News)

Trust’s chairman hits back at iwi leaders

Maori trust to control Tongan forests

Tonga Forest Products Ltd Granted New Lease of Life (Ministry of Information and Communication)

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