KEITH JACKSON

TIM ASHTON [right] WAS RAISED on the plains of central NSW and developed a love of rural life and people and, through his family, a strong belief in social equity and justice.

In 2005, he happened to be introduced to the charismatic President Joseph Kabui of Bougainville, got on well with him and was invited to visit the autonomous province to assist in any way he could.

Ashton took up the offer and, when he arrived in Bougainville, was assigned by Kabui to review foreign entities seeking to gain an early foothold in Bougainville following the tragic civil war.

Ashton decided to start by looking at an outfit called Invincible, purportedly a Canadian resources company.

“I provided Kabui with a report on Invincible,” Ashton says, “in which I found very strong circumstantial evidence that it was at best opportunist, even fly-by-night….

“More disturbingly, it was not the native Canadian company it represented itself to be, but one which originated in Russia. It had been backdoor listed on the Toronto stock exchange and was funded through a secret Cayman Islands trust with links into Russia…”

Ashton was alarmed about the deal Kabui’s new Bougainville government might be about to do with a company that lacked transparency and had such obscure associations.

“I have always held a belief that one should not get into bed with any entity without first being able to look under it and with Invincible that was impossible.”

Ashton submitted his report – “which was received rather coolly” - to later find out that Invincible had funded President Kabui’s election by a reported $US2 million.

He was disappointed but undeterred.

Ashton began to establish a joint venture with some Bougainvillean investors to import quality rice to be fortified, packed and distributed within Bougainville, providing a solid local industry and providing good returns.

The competitive advantage of the business was that it would sell wholesale directly from the factory; which no other company could do.

The Bougainville end of the project was relatively easy once Ashton gained the trust of potential investors.

He says: “The business model is predicated around raising trade finance of K550,000 for nine months, secured against government title land with buildings and plant to the value of approx K1.2M.”.

OK, good, productive idea. Not a great capital cost. Socially and economically desirable in a province struggling to reassert itself. So what’s the problem?

“It revolves around what appears to be an unofficial embargo on providing credit to Bougainville by finance institutions based in Port Moresby,” Ashton explains.

“The National Development Bank gave conditional approval, the condition being that we provide security outside Bougainville.

“We had investors in the province, but this condition really raised the bar. And on such a modest investment, too.

“In the case of another potential investor, the CEO of a major finance organisation was keen to go ahead but was outvoted by his fellow directors.”

Ashton is puzzled at this negative response, which he equates to an embargo.

“Bougainville is a far safer environment than Moresby, Lae or the Highlands. Expats and nationals walk everywhere, even at night, through Buka, Arawa and Buin,” he observes.

“The BSP bank in Buka is built of fibro and gyprock and has a couple of unarmed security guards by day, who are more interested in sleeping or chatting up young ladies!”

So there’s a potentially profitable, viable, eminently socially desirable project ready to go in Bougainville – but it lacks what is basically short term trade finance to fire it up.

“We need K550,000 loan for nine months and as a sweetener we are offering a generous free carried equity position in the operation.”

That’s the deal.

Anyone out there interested.

If you want to obtain further information, you can email Tim at [email protected]