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Manufacturing Industry
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Manufacturing Industry

For Investors  >  Sector Profiles  >  Manufacturing Industry
ManufacturingOverview
 
This sector includes the manufacture of textiles, garments, footwear, sugar, tobacco, food processing, beverages (including mineral water) and wood - based industries. Growth in the sector is largely expected from the restructure of the sugar industry and the FMF Foods Ltd, operating at full capacity.Fiji provides the cheapest manufacturing environment in the Pacific region with its cheap and efficient labour, cheaper operational cost and efficient port and gateway to Asia Pacific in comparison to other Pacific Countries
 
Potential Investment Opportunities
 
Textile, clothing and footwear have become a major export industry following its establishment in 1988.
 
The agro-based food processing industries, which include canned fish, beef and fruits and furniture making, have huge potential to be developed further, for exports.
 
Tax Incentives
 
Food Processing & Forestry
 
  • Food processing and forestry may claim 100% as a deduction on the amount spent on capital investment. The deduction is available for those new businesses engaged in value adding processes.
  • Re-investment for expansion purposes will also be allowed such deduction.
  • In order to qualify the investor should utilize 50% of local produce (inclusive of raw materials, labour etc.) in its production process.
 
Renewable Energy Projects and Power Cogeneration
 
  • A 5 year tax holiday is available to a taxpayer undertaking a new activity in renewable energy projects and power co-generation as approved by the Commissioner.
  • Duty free importation of renewable energy goods is also available.
 
Bio – Fuel Production
 
  • A 10 year tax holiday is available to a taxpayer undertaking a new activity in processing agricultural commodities into bio-fuel as approved by the Commissioner from 1 January 2009 to 31 December 2014
  • Low Corporate Tax of 20%.
  • No withholding tax on dividends.
  • Accelerated depreciation of 20% is allowed for building erected before 31 December 2010 for commercial and industrial purposes and can be written off within any 5-8 years.
  • Carry forward of losses for 8 years.
  • Export Income Deduction - income derived from the business of exporting goods or services (but excludes re-exports) is exempt at a reducing rate at 40 %.
  • Repatriation of Profits permitted.
  • Accelerated depreciation is also extended to renewable energy plant and water storage facilities.
 
Investing in the Sector
 
Under the 2009 Foreign Investment Regulations (FIR) the manufacturing sector has a few requirements that need to be met by the investors should they wish to undertake the following activity that is listed under the manufacturing sector:
 
Tobacco production: An investor wishing to engage in this business, is required, by the FIR to use at least 75% of locally grown and processed tobacco in all domestic cigarette production and must have at least F$500,000 in cash from the operational date.