Master plan
THIRTY-THREE years ago, MVB — MVA’s predecessor — came up with a 10-year “action plan,” which stated that the local tourism’s impressive growth since 1976 took place “without the benefit of a comprehensive plan or policy….” Hence, the need for a “Master Plan” to ensure the success of an industry…dependent on global factors beyond the CNMI’s control.
Government planners, to be sure, are not known for their sense of irony. To quote historian and author William Henry Chamberlin, a government plan is usually an “exercise in exhortation or a statistical analysis of what would be desirable if a long string of doubtful conditions should be realized.”
In the case of the local tourism industry, it’s spectacular growth in the 1980s was the direct result of Japan’s economic boom during the same decade. According to the 1990 tourism action plan, the CNMI’s second largest market at the time was the U.S., with over 54,000 arrivals in fiscal year 1989. However, these included “a large percentage of visitors…from Guam and/or are traveling on business.” Back then, with only 10,000 arrivals in 1989, South Korea was the third major market, but with “great potential” for the CNMI. The other “potential markets” were Australia, the U.K., Germany, Canada and Taiwan. But the action plan also acknowledged that the CNMI was competing against other tropical destinations that included Guam, Okinawa, Hawaii, Australia, Tahiti, Fiji and the Philippines.
Nevertheless, the action plan estimated that arrivals to the CNMI would reach 1.2 million or 2.9 million in 2000. Based on the CNMI Statistical Yearbook in that year, actual arrivals totaled 528,597 (including 7,895 from Taiwan). Arrivals had steadily dropped since the 1997 Asian currency crisis, which, of course, wasn’t foreseen by government planners and their consultants in 1990.
Strategic plan
IN 2005, and “with little warning,” Japan Airlines ended its direct flight service to Saipan. In its federally funded 2012-2016 master plan, MVA noted that the “level of air service from Japan has never returned to what it once was…. In FY 2011, the islands received only 338,646 visitors, a drop of 53% over the peak year.” And yet these visitors “came from a greater diversity of key markets: Japan, Korea, China, Russia and Guam/U.S.”
At that time, the CNMI was “experiencing an unprecedented economic depression caused by multiple factors. These include the complete loss of Saipan’s garment industry, a major decline in international air service, the absence of tourism destination marketing in the islands’ key source markets, and rapidly rising costs of doing business.”
Back then, moreover, there were no ARPA funds or FEMA reimbursements that could help pay for the CNMI government’s expenses and obligations.
In any case, MVA’s 2012-2016 master plan mentioned that although the CNMI had received Taiwanese visitors in the past, “there is no direct air service [and] virtually no Taiwanese visitors at this time.” Nevertheless, the Taiwan marker could be “re-opened…if marketing dollars and transportation were to become available.”
As for China and Russia, the 2012-2016 master plan identified them as “the fastest growing outbound markets in the world.” Once again, due to global events beyond the CNMI’s control, both markets are all but “dead” today.
For its 2021-2031 “strategic plan,” MVA, after noting that the local economy was “distressed” (again), acknowledged that a “tourism economy is inherently fragile because it is subject to outside factors beyond the control of the destination.” Now we’re talking. The plan, incidentally, identified Japan, Korea and China as MVA’s primary target countries with Taiwan, Russia and the U.S. as the secondary targets.
Lessons no one in government wants to learn
MVA works with tourism experts and stakeholders who are invested in the success of the tourism industry. They are aware of what is going on around the world, and how it could affect the CNMI. But they also have to deal with government officials whose primary motive, more often than not, is their political survival. Hence, like their predecessors, incumbent officials must be constantly reminded that the local tourism industry took several years to develop and become a major contributor to the CNMI economy. Ditto the Japanese, Korean and Chinese markets.
MVA — and the CNMI government — can only do so much. And so much depends on “outside factors.” (It took about 15 years before the local tourism industry could recover from the dizzying drop in arrivals that began in 1998.)
What CNMI officials can actually do right now is to admit to the public that the government can no longer afford all its obligations; and that its expenditures must, for once, match its actual collections. Imposing new taxes and/or fees is a budgeting trick. Higher tax/fee rates will not necessarily result in more revenue in this bad economy. Businesses and taxpayers, in any case, are already cutting costs (including laying off employees), and making other tough and painful decisions. Why should they (again) foot the bill for this bloated government’s fiscal irresponsibility?
