Say when
MANY members of the business community want to see the revival of the islands’ second largest tourism market, China. However, the Asian country’s ruling party is now considered a major threat to the U.S., which includes the CNMI.
The governor, for his part, has announced a “pivot” away from China while requesting for more funding assistance from the federal government, specifically from the U.S. military. On Tuesday, he told reporters that “a $150 million divert airfield and the CNMI Joint Military Training on Tinian will be ‘rolling out soon, and we need to put those in our consciousness.’ ”
But when is “soon”? The CNMI government has so many financial obligations to meet, foremost of which is government payroll. Also on the list: Settlement Fund payments, the retirees’ 25% benefit, medical referrals, local Medicaid, the government employee’s group health and life insurance, utilities — among (so) many other things.
Right now, the Korean tourism market, which is still recovering, is all that the CNMI has. Arrivals from its two other major markets, China and Japan, are way below par. Everything is interconnected in an economy, and so most, if not almost all, businesses are feeling the crunch. Not surprisingly, the CNMI government has missed its FY 2023 revenue targets. In short, the government is again spending more than what it can collect.
So regarding the desperately needed relief from the U.S. military, we ask again. When is “soon”?
You’re on your own
MVA said it “supports the administration’s directive to strengthen our Japan and Korea markets (our political allies) and to seek opportunities in other markets,” but added that it will “take time and research.” It was in 2003, during the Babauta administration, when China designated the CNMI as an “approved destination” for Chinese tourists. “This is an historic day for the Commonwealth,” the then-governor said. But it took 10 more years before the China market took off and eventually became a major source of tourists for the CNMI.
To paraphrase what a tourism agency official said in a letter to the editor 40 years ago: It’s not easy to increase flights to our islands.
According to Governor Palacios, he was not saying that “tourism activities from China need to stop.” In other words, tourism-related businesses are on their own when it comes to reaching out to the China market and promoting the Commonwealth as a welcoming tropical destination.
Many reasonable people can say that the current (and latest) economic disaster was caused mainly by government mandates: lockdowns, travel and other restrictions compounded by other government diktats that have created labor shortages. So perhaps the business community should also tell the government to live within its means, and to stop treating businesses like its own private ATM.
Hear, hear
“WE cannot continue to be looking at things just for instant gratification,” the governor told reporters on Tuesday, adding that the CNMI must create a “really sustainable economy.”
He’s right. Instead of raising taxes and/or fees, elected officials should find more ways to reduce government spending. The government’s current spending levels are unsustainable. Elected officials should learn how to say no to their constituents. There’s not enough money to fund all the “requests” of voters and their families.
As for the ongoing FY 2024 budget deliberations, lawmakers should ask themselves if the revenue projections are still “realistic” in light of the worsening labor shortages, which will affect many (struggling) businesses. Lawmakers should also take into account the number of local and other residents leaving the island each week, and the businesses that are either downsizing or shutting down.
“Rebuilding trust” starts by telling the public the truth.
