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Payments on time

Ropate Valemei
Friday, January 11, 2013

THE Fiji National Provident Fund (FNPF) has confirmed Air Pacific has been servicing its $200million loan for the new aircraft in a timely manner.

FNPF chief executive officer Aisake Taito said they based their decision to invest in Air Pacific on their investment in the tourism industry.

"We can confirm that Air Pacific has been servicing this loan in a timely manner.

"As we had stated in the past, our decision to invest in Air Pacific was a strategic initiative to add value to our investment in the tourism industry," Mr Taito said.

However, the fund was tight-lipped on the conditions of the loan with the national airline. "FNPF would not be able to divulge the details of the loan agreement," Mr Taito said.

Meanwhile, Asian Development Bank Pacific Department principal economist Emma Veve told ABC Radio Australia the superannuation fund was in a difficult situation.

"The situation at the moment sees the FNPF constrained predominantly to investments in Fiji.

"When you've got a very small economy, you've got a significant amount of money, such as what FNPF has and is trying to invest. It becomes difficult after a period of time to keep finding good sound investments that will make that secure return for the retirees. So FNPF is in a difficult situation," Ms Veve told ABC Radio Australia.

"Ideally, you would see a provident fund investing in fairly secure investments; government bonds, loans directly to other governments for example.

"Typically you wouldn't see a provident fund investing in an aircraft."

Announcing the new addition to its fleet last year, Air Pacific chief executive officer Dave Pflieger made public that Air Pacific had ordered three new Airbus A330-200 aircrafts, all valued at a catalogue price of USD$600 million ($F1.069billion).

Mr Pflieger revealed a funding of approximately $200m from FNPF and 85 per cent offshore investments for the new air fleet.

The first aircraft is expected to arrive in March while another will arrive in May and November this year to replace the present Boeing 747 and 767 fleet.





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