MARIANAS Visitors Authority board member Ivan Quichocho said the islands’ “Tourism Resumption Investment Plan” includes subsidies for airlines and hotels that will be funded by the American Rescue Plan Act or ARPA.
In his remarks during a tourism stakeholders meeting at Saipan World Resort, Quichocho said, “We’re having this conversation thanks to the hard work of the administration, and its Covid-19 Task Force — we are a safe destination, and we are Covid-free.”
He said local resources were tapped to ensure the safety of the CNMI while community members follow the protocols.
“We are not backing off from that,” he added. “We are staying steady with continued safety protocols while we [reopen] tourism. That’s always going to be the first and foremost priority: safety of the community because that got us where we are. But there is also a cost associated with being safe, and that cost of being safe can also be a challenge when reopening our tourism destination for the average visitors.”
Quichocho said MVA has already reached out to airline carriers.
“We talked to them and we asked them what are the chances of their resuming flights and if they can resume flights what will be the flight rate,” he said.
“If they do operate, they said the demand is maybe less than 20% of the load capacity of the flight,” he said.
He added that not too many airlines are planning to resume their flight service.
He noted that before the Covid-19 pandemic shut down the global tourism industry last year, “we approximately had 68 to 72 flights a week from varying destinations. To date we only have four flights a week from Guam, and through the mainland U.S. Our airline partners, in order for them to reopen our destination, will require incentives,” he added.
Quichocho said the same goes for the hotels. “Majority of the hotels have scaled back or shut down their operations — they don’t offer the same amenities, and most have reduced their workforce.”
In his presentation, Quichocho discussed the “Airlines Crucial Partnership Pilot Program” that will run from July 15 to September 2021.
The plan involves a projected 40% load factor, a target ticket price per passenger of under $400, two flights per week, and two airline carriers that will provide eight flights.
“Our performance together during the eight weeks will decide our tourism market’s future,” Quichocho said.
“We need to get our economic engine started — we got to prime the pump, so to speak, in order to get it going. It does not make sense for the hotels to open up 25 rooms only or [for] airlines to fly with only [a] 20% load, so in order for us to provide the infrastructure to build the momentum and demand, we have to subsidize it. Otherwise, doing nothing will get us nothing,” Quichocho added.
“We are subsidizing the…hotels…because the requirements…are going to be cost prohibitive so we are also subsiding the air carriers…and we are covering the PCR testing requirements,” he added.
Under this program, the hotel room rate will be set at $150, Quichocho said.
As for the selection of the airlines, Quichocho said the Attorney General’s Office is reviewing the proposed request for proposals. “So once the vetting is finished, they release it to us, and the RFP goes out and we choose the airlines.”
Quichocho said the administration “has advised us that… we will tap ARPA funds…which, among other things, also aim to restart economies.”
He added, “We do know for sure that employment needs to be restarted. The Pandemic Unemployment Assistance will end on Sept. 30, that’s for sure. So this tourism resumption plan is actually good news — we will restart our economy and get people back to work.”
Marianas Visitors Authority board member Ivan Quichocho talks about the “Tourism Resumption Investment Plan” at a tourism stakeholders meeting on Tuesday at Saipan World Resort.
Photo by Bryan Manabat
