U.S. Congresswoman Kimberlyn King-Hinds stands next to President Donald Trump at the White House on Tuesday, March 25, 2025. She and several of her colleagues from the 119th Congress met with Trump. King-Hinds said she appreciated the opportunity to meet with the President and looks forward to continuing to build strong relationships with the White House and the Trump Administration.
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Arnold I. Palacios
“WE are in full agreement on the importance of restoring and expanding tourism through a multipronged approach as a key element of our recovery,” Gov. Arnold I. Palacios said to U.S. Congresswoman Kimberlyn King-Hinds in a letter dated March 25, 2025.
To that end, he said, he met with then-Deputy Secretary of State Kurt Campbell last fall to appeal for the State Department to ask U.S. embassies in the region to make a special effort through their commercial attachés to promote the CNMI as a tourist destination.
With the change of administration in the U.S., Palacios said he renewed his appeal during a meeting with new Secretary of State Marco Rubio.
He said he welcomes King-Hinds’ support for measures such as the cabotage waiver and her advocacy for tourism from neighboring countries.
He said the CNMI government for the past two years has pursued these measures, which are crucial for the revitalization of the local economy.
Palacios said he was invited by Taiwan’s representative in Washington, D.C. to have lunch with a group of senior members of the Taiwan Parliament led by their Speaker of the House along with members of the U.S. Congressional Taiwan caucus where the governor said he made the same plea.
He said he told them that he has not taken any steps to restrict legal Chinese tourism to the CNMI.
“We fully welcome legal tourists from all regions, including China. It is important for us to communicate this clearly, as fostering a diverse tourist base is essential for our economic stability,” the governor said.
“Your interest in concentrating on tourists from the [People’s Republic of China] is noted, but both from the public discourse reported in various Mainland media outlets and my private meetings with congressional leaders and senior officials in the Trump administration during my two trips to Washington, there is little mood for increasing China’s involvement in the Pacific in any sector in any of the islands. I realize you have made certain commitments, but I believe you understand you will be facing a lot of headwinds even more so if the Trump administration is successful in wrapping up conflicts in Europe and the Middle East and turn their attention to the Indo-Pacific,” Palacios added.
He said he thinks Defense Secretary Pete Hegseth’s planned trip to the Marianas region in the near future “is a strong indication of that.”
Like her predecessor, former U.S. Congressman Gregorio Kilili Camacho Sablan, Congresswoman King-Hinds has asked the U.S. Department of Transportation to reinstate Annex VI of the bilateral U.S.-China Air Transport Agreement to allow the resumption of direct mainland China-Saipan flights.
The Saipan Chamber of Commerce, the Hotel Association of the Northern Mariana Islands, and the CNMI Senate have expressed their support for this request.
Negotiations
For now, Palacios said, “our main focus will be negotiations with the federal government under section 902 of the Covenant.”
The governor said he is seeking King-Hinds’ support on “other critical initiatives”: restoring Covenant 702 funds, inclusion in the Essential Air Service program, reducing airfare between Guam and Saipan, advocating for a ferry system connecting all the Marianas, further implementing infrastructure projects, such as ports and utilities, and expanding on possible Department of Defense-related investments.
Palacios said establishing the CNMI as a regional hub for health and education in the Pacific should remain a priority. “I hope to be able to discuss these projects with Secretary Hegseth,” he said.
‘Not a bailout’
Palacios reiterated that his request to restore 702 funds and “repurpose” over $400 million in Pandemic Unemployment Assistance and Federal Pandemic Unemployment Compensation funds allocated for the CNMI is not a “bailout.”
He said the 702 funds are federal assistance “promised in our Covenant and is no different than the direct budgetary support that American Samoa receives annually and similar to the help the other territories receive through other devices.”
He added that “the use of the term bailout is [also] a mischaracterization of what we are trying to accomplish with the repurposing of PUA funds.”
Variety learned that the governor had made a similar request to the Biden administration.
In a letter dated March 4, 2024, U.S. Department of Labor Principal Deputy Assistant Secretary Brent Parton told Palacios:
“It is our understanding that CNMI is seeking authorization to utilize the remaining PUA and FPUC funds to help restore economic stability. The Department is not able to provide such authorization. Federal law only permits the use of these appropriated funds for the purposes intended — payment of PUA and FPUC benefits for the weeks of unemployment covered by the programs. These funds may not be used for any other purpose.”
Parton also said that the CNMI was obligated to return unused funds.
Palacios has asked King-Hinds to introduce legislation to “repurpose” the PUA/FPUC funds, but she noted that with “Washington actively working to cut $2 trillion in spending across all programs and agencies, securing an appropriation of this magnitude is not only highly unlikely, but also risks making the CNMI appear unserious about our own economic responsibility. We must be transparent with the public about the slim prospects for this effort.”
In his letter to King-Hinds, Palacios said: “My first stop in Washington was a courtesy call on your office, as it should have been, and I came away from our visit with the sense that, other than Chinese tourism, our differences are not that great and I look forward to continuing to work with you in the vastly changed environment that the new Congress and administration have brought to the Nation’s Capital.”
He added, “I know that, for my part, I already have developed some new and deep relationships in the Trump Administration that I believe will serve the people of our Commonwealth well. Please call me any time you believe I can be of help in your work.”
U.S. Congresswoman Kimberlyn King-Hinds walks outside of the Oval Office in the West Wing of the White House following a meeting with President Donald Trump on Tuesday, March 25, 2025.
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