Among other factors cited in the report, Inos noted this statement from Moody’s Investors Service: “The rating downgrade reflects the substantial economic deterioration in the CNMI resulting from changes in minimum wage laws that drove out the garment industry that had been a dominant sector in the local economy…. The loss of this entire industry is a substantial blow to an already weak and narrow economic base.”
In another section of the report, Inos also noted the federalization of the CNMI’s immigration control as yet another factor in the islands’ deteriorating financial situation and financial rating.
The report noted that “the federal takeover of CNMI immigration policy set to take effect in November creates additional uncertainty in the already beleaguered tourist sector.”
The report specifically cited the expected loss of vital Chinese and Russian tourists as a basis for the CNMI’s financial downgrade.
Moody’s also cited a CNMI population decline that will be exacerbated by restrictive new federal immigration rules that will result in the loss of more foreign workers and less economic activity in the commonwealth.
