The program, signed into law on Wednesday by Gov. Benigno R. Fitial, aims to encourage year round air service from the source cities of Osaka and Nagoya, Japan. At present, air service from Osaka and Nagoya are operational during peak periods and nonoperational during off-peak periods. The program will provide a monetary incentive to all participating Japanese travel agents who sell seats from Japan to the CNMI from these two source cities during qualifying off-peak periods.
The Japan source market comprises about half of the approximate 400,000 annual visitor arrivals to the NMI, but currently, only flights from Narita (Tokyo) operate year round.
“The enactment of the Japan Air Stabilization Program gives us a new economic tool to attract more visitors during the so-called ‘death valley’ months,” said MVA Chairwoman Marian Aldan-Pierce. “Equally important, this law demonstrates a unified intent of the MVA, the Legislature, and the governor and lt. governor to support tourism, since it is our sole economic driver.”
The bill earmarks a percentage of hotel occupancy tax and business gross receipt tax to be deposited bi-weekly by the secretary of Finance into a trust fund for the incentives.
According to MVA Managing Director Perry Tenorio, MVA is already working with the secretary of Finance to establish rules and regulations for the program, including eligibility requirements for participating agents. The actual amount to be expended will be determined in the required rules, and no funds can be expended from the fund except for direct flights that would not otherwise exist during periods when no regularly scheduled flights come from Osaka or Nagoya.
“There is an urgency to establish the rules of the program so that we can present the specifics of the incentive program to our travel partners in Japan soon enough to help drive traffic to Saipan, Tinian and Rota during the next down period this fall,” said Tenorio. “There are some provisions in the law that will require some consideration on the overall impact of the program. Unfortunately, the promulgation of the rules and regulations as required by this law and the time needed by those travel agents that want to partake in the program to develop and implement their promotions requires considerable time, so the implementation of this program will probably not be in time for the April through July ‘death valley.’”
The program also provides special additional incentives for flights to Tinian and Rota to induce more visitors to choose those destinations.
