Tuesday 24 June 2025 | Written by Talaia Mika | Published in Economy, National, Outer Islands
Metua Vaiimene, left, owner of Te Vai Anga Service Station, which supplies fuel and hardware on the island of Mangaia, fears the freight rise could immediately push his business into loss, due to the government-regulated pricing on fuel. TALAIA MIKA/25062326
The increase, announced last month by Matson South Pacific, through its agent Excil Shipping, has already begun impacting supply chains and pricing structures for outer island retailers.
The increases, according to Matson, are necessary to reflect “significant accumulated increases” in operating, compliance, and fuel costs, and to sustain vessel reliability and service standards.
Earlier, Taio Shipping, which services inter-island routes in the Cook Islands, said the 30 per cent freight rise was necessary to cover increasing operational costs.
However, outer island businesses like those in Mangaia say the burden is falling too heavily on Pa Enua communities already grappling with high costs, limited incomes and uncertain access to goods.
Justin Pokino, manager of Mangaia’s largest walk-in grocery store and the only retailer on the island licensed to sell alcohol, says the freight hike is especially hard on islands like Mangaia which sit “at the bottom of the supply chain”.
“Thirty per cent is a large increment in the cost of shipping. And especially for us in the outer islands, we’re going to feel it the most,” Pokino told Cook Islands News.
“And with the increase in the South Pacific route, the cost of goods are going to go up in Raro. And then in turn, us purchasing wholesale from them, those prices are going to go up. So then we’ll have to put our own prices up over here.”
Pokino said the cost of living in Mangaia is already “bad enough,” and that while they try to keep prices low, there is little option now but to pass the costs on to customers.
“In the end, we are a business and we would like to make money. And we’ll have to pass on those costs to our customers eventually.”
Pokino, whose family has operated the shop and accompanying guesthouse for three generations, is urging the government to consider freight subsidies for Pa Enua businesses.
Cook Islands Government is investing $2 million this financial year in shipping services, specifically for the setup of two vessels that will provide transportation and cargo services for the Pa Enua.
In 2023, government approved the Domestic Shipping Roadmap which detailed the establishment of a government-operated fleet to serve people in the Northern and Southern Pa Enua. Two vessels have been secured, one from China and one from Japan.
According to Prime Minister Mark Brown, the arrival of the two ships is expected sometime next year: a vessel from Japan is due for delivery in March, and one from China in July.
However, Pokino is urgently calling for support to alleviate the rising costs they are already facing.
“Maybe it’s that route from Rarotonga to here at the Pa Enua, especially through domestic shipping services like Taio Shipping and the other (Cook Islands General Transport). And I think it starts here if the government is able to kind of subsidise shipping to the Pa Enua,” he said.
“Maybe we can mitigate the cost of the increase through our shipping … at least there might be some sort of reprieve if they bring shipping to the Pa Enua down. So it kind of offsets costs in that way.”
Metua Vaiimene, owner of Te Vai Anga Service Station, which supplies fuel and hardware on the island, fears the freight rise could immediately push his business into loss, due to the government-regulated pricing on fuel.
“My main concern is the cost of fuel and how the increases in the freight costs will impact the cost of fuel. As you may know, the cost of fuel is regulated by government, so the price is set by the Price Tribunal,” Vaiimene explained.
“If the new freight costs are coming on this boat that’s coming this week (last week), we’ll immediately start losing money as a business if we can’t recover those freight costs.”
Vaiimene, whose family business has operated for 27 years, says he is currently selling fuel from existing stock but is anxiously awaiting guidance on whether freight increases will be factored into new regulated pricing.
“If we do adjust our price, we’ll be breaking the law, so I really want to encourage the Price Tribunal and the people in power in Rarotonga to be addressing this issue of the freight costs and the impact on fuel as quickly as possible.”
Like many Pa Enua businesses, Te Vai Anga relies heavily on the public sector, given the island’s small and shrinking private sector.
“We are only one of a handful of businesses on the island,” Vaiimene said. “Most of the government workers get paid here on the island and also most people are beneficiaries, so they are on the welfare of some sort.”
“So, we need the government to be running smoothly, to be paying their workers and paying the benefit. That’s how we survive in the private sector here on Mangaia, and it’s a struggle.”
Despite the challenges, Vaiimene says his customers remain resilient and willing to shoulder costs to get the supplies they need.
“If they want it urgently, they’ll pay the freight costs. That’s the reality of living in Mangaia. That’s the reality of living on the islands outside of Rarotonga. We pay high costs for freight and it’s a struggle.”
Also read:
> PM: Budget targets cost of living amidst freight hikes
> Domestic shipping warns of rising costs for Pa Enua as freight rates increase