Kiribati is an island republic in the Central Pacific with 811 square kilometres of land area largely in atolls and islets. The population of the country as per 2015 census is 110,136 and the nominal GDP is US$167 million. Over 50% of the population live in the capital, South Tarawa. The country is position 134 of 189 in the 2018 UNDP global human development index. It is a “Small Island Developing State” and a “Least Developed Country” according to the UN Classification. A GDP growth in 2015 was 7.5 %, compared to 25% in 2014 and 5.8% in 2013 and 5.2% in 2012. The higher GDP growth rate of 7.5% was attributed to increase in construction, wholesale & retail trade industries, transport, storage, and financial intermediation activities. Sustaining the GDP growth rate will however depend on the diversification of the domestic industries in those sectors where Kiribati has comparative advantage. The public sector accounts for two-thirds of formal employment and about half of GDP. The outer islands remain economically underdeveloped, with limited economic activities. While crop farming is limited in Kiribati, coconut remains the dominant cash crop especially for livelihood of the community living on the outer Islands. Coconut production is reflecting a 46.3 percentage contribution to Kiribati’s National Export Earnings. Total production is recorded at 54.6 million nuts equivalent and 9,134 (MT) as copra equivalent. Coconut export value for Kiribati now stands at US$4,516,000 and showing revenue earnings as US$9,764,000. Export volumes comprising of coconut oil at 2,939 (MT), copra at 1,332(MT) and copra meal at 216 (MT)[1] Despite the contribution of coconut to export earnings and income for the country, the sector is constrained by limited variety of products, with low-income revenue to farmers due to overdependence on primary coconut products. The development of coconut sector development is further constrained by limited participation by the private sector especially the SMEs at the community level on the outer Islands in the potential value added products. Government has embarked on a 20-year vision Development Plan (KV20) anchored on the vision of creating a wealthy, healthy and peaceful economy. The opportunity to create a wealthy economy depends on the level of development of the key sectors where Kiribati has comparative advantage. The government through the KV20 seeks to implement policy measures in order to achieve inclusive and sustainable economic growth. As a result, the government seeks to strengthen the implementation of income generating programmes on the outer Islands with the view of fostering economic empowerment of the community. The inclusive development strategy is further affirmed in the recently launched Trade Policy Framework (TPF) .The TPF seeks to ensure the benefits of trade spreads of to all I-Kiribati. The government through its Trade Policy seeks to ensure that economic empowerment programmes positively impacts on the marginalised groups like the youth, women and disabled persons. The coconut sector provides opportunities for income generation and wealth distribution mechanism through which the government can achieve its inclusive and sustainable growth development agenda. This is given that over 80 % of the rural community especially those living on the outer Islands rely on the coconut sector as their main source of livelihood and income generation. There is need to foster value addition strategies and increase productivity in order to stimulate inclusive and sustainable economic development. While significant percentage of the population relies on coconut sector, there is limited value chain linkages that provides wider economic opportunities for other key actors like women given that women have limited direct engagement in the Copra cutting activities as compared to men. Maximising the development benefits from the coconut sector with the view of fostering income generation and livelihood for the youth, women and other marginalised groups remains to be a key challenge to unlocking the country’s inclusive economic growth and development agenda. Government has identified and intends to foster the production of Virgin Coconut Oil (VCO) at the community level as one of the product diversification strategies. Developing VCOs and related downstream product at the community level is an opportunity to reduce rural –urban drift in line with the KV20 targets .The strategy will also provide an avenue to maximize economic returns and profitability from the sector. Government also sees a potential opportunity in maximising the Profitability of VCO production and related downstream products such as hand-made bath soaps, massage oils, moisturising body oil among others; Government is implementing initiatives to foster Local Economic Development (LED) targeting the outer islands. In this context, there is need to stimulate the development of VCO and downstream products in one of the selected Islands. To achieve this objective, government through this consultancy seeks to undertake an in-depth assessment to understand the technical and economic viability of this initiative. This consultancy comes under the “Enhancing Inclusive Sustainable Economic Development through Coconut Sector Development project” funded by India, Brazil and South Africa (IBSA) Facility. The project commenced in March 2018 with the aim to support the development of the Coconut Sector Strategy, build the capacity of the relevant stakeholders and to undertake feasibility study informing the implementation of viable community driven coconut projects. As part of the project, UNDP, as the Main Implementing Entity, is seeking the services a coconut expert with expertise in coconut processing, Value chain Analysis of VCO Processing and downstream products, VCO processing technologies and proven experience in undertaking feasibility studies to inform the technical design of the project. |