THE export industry in Fiji began when the Europeans settled in the country.
The great sandalwood trade in Bua, the beche-de-mer trade, the whaling colony in Levuka from the mid- 1800s to the early 1900s brought about significant change to the lives of the iTaukei and Fiji as a whole.
The booming whale trade and the search for the perfect conditions to establish cotton fields brought the influx of people from a very different world into the Pacific and Fiji.
This process we all know eventually led to the ceding of Fiji to Great Britain.
With the colonisers came significant changes to the lives of the iTaukei where standards were set and rules and laws put in place to govern the lives of all.
But perhaps one of the figures noted in Fiji's history is that of a man who challenged the business ideals of the administrators as a means of addressing the imbalance of trade and sharing of profits between the westerners and the iTaukei — the resource owners.
Apolosi R Nawai is a well known figure in the history of Fiji.
His place in the country's history is centred mostly around his set-up of the Viti Company (later the Fiji Produce Association in the early 1900s.)
Nawai, although a commoner, challenged the status quo.
He wanted the iTaukei to also benefit from their own land and the fruits of their labour by setting up exports through Suva via bananas from the interior of Viti Levu and copra sourced from the islands.
Nawai was born in Narewa in Nadi in 1876.
He was educated at the Methodist Training School at Navuloa and Davuilevu where he acquired skills both in carpentry and the Bible (theology).
It is said on one such engagement of building a church in Korovatu, Vunidawa in the Naitasiri highlands, he observed the banana trade more closely.
Every day he saw how the European-owned punts travelled the Wainimala River to transport bananas for the export market in Suva.
The company established by Nawai, Viti Company or Fiji Produce Agency to provide an alternative outlet for the produce of the iTaukei, directly competed with European traders and ruffled many feathers.
Nawai had much to do with the evolvement of the banana trade and copra trade in the early 1900s.
What we need to learn from this?
The examples stated above clearly shows that from the old days, the resource owners reaped very little of the rewards.
Nawai, way back then calculated that when trading bananas, the European middlemen, made approximately £10,000 on an investment of £2000.
But under Viti Company, all iTaukei would pool their earnings together, cut out the middlemen and share their own profits.
Today, our farmers are still experiencing the same from modern day middlemen. The question is - how can we enforce equal sharing?
The way forward for exports is to identify the loopholes, especially those that are obstacles instead of adding value to the supply chain.
At the moment the cake is not being shared equally.
It would be interesting to highlight who eats the biggest chunk in the supply chain; the farmer, the middleman or the shipping line or air freight service?
Unfortunately, in the world of business, these things cannot be forced, so education is the only key.
Today, the cost of expenses for the farmer would be labour costs, equipment, and food.
However, if he cuts out the middleman then he would have to factor in transportation and fuel costs including maintenance of his vehicle fleet.
For instance, if he sold the produce for $2 per kg to his middleman, if he took it straight to the market he could then sell it at $3 per kg to factor in transportation cost.
Should he take it straight to a distributor or exporter, he may have to sell cheaper to guarantee his produce will be bought every time from the exporter, or if he improves and focuses on quality then the exporter would be forced to take his produce every time at a higher price too.
The exporter, after packaging, freezing and shipping will now add a value to the product which could not be two to three times higher than what he bought from the farmer.
The shipping liner or freight forwarders will charge for costs of their services apart from shipment.
The cost of the product will increase along the supply chain before it reaches the customer.
The point is, the art of buying and selling has not changed much from years ago, the modes of doing it may have changed but the basic principles are still the same.
Nawai was able to master or drive the will of the Fijian traders through his effective use of his communication skills.
That very same skill is being used by many today but has perhaps been enhanced by the use of the mobile phone.
Negotiation skills thus become an everyday thing.
The mobile phone has thus become an integral part in the trade process from farmers' level.
Today the use of the middleman, which Nawai removed back in his days, has evolved with the establishment of a diverse or modern distribution channel.
There are now new additions to the supply chain, although still very much based on the basic ones used in the days of the banana trade.
The bananas used to be sourced from the middle man to the Suva Wharf and into ships before.
Today, produce from the farmer is picked by the middleman and it either goes to markets, or to distributors/manufacturers who make changes to the product, packages them, branding is made.
Also today the road is the preferred means of delivery as it is cost effective and faster as opposed to the use of the waterways.
But the waterways are still used in areas where there is no access via roads.
But perhaps, what we should take out of history is that Fiji began as a trading hub in the region on the arrival of the white men, yet today it is still grappling with a few issues which existed from the early days.
Next week we look at the history of the export industry in Fiji.
* This is a weekly contribution from the Fiji Export Council.