Good luck with that
THE government’s fiscal year 2024 budget, which the governor is expected to sign into law, is based on revenue projections that consist mainly of a wing and a prayer.
Several events must occur to make the budget “work.” Tourist arrivals must increase significantly. The tax-hike measures, which will be imposed on already struggling taxpayers, must result in additional revenue. The much anticipated military projects must materialize soon. Construction companies as well as hotels and other tourism-based businesses must somehow cope with the CW touchback provision. There must be no catastrophic typhoon nor another global crisis (pandemic or war) that will once again send the economy into a coma.
In short, so much depends on things over which the CNMI has little or no control.
The administration believes it is doing all it can to revive the local economy, mainly by reaching out to federal and U.S. military officials. MVA, for its part, is stepping up promotions in South Korea and Japan, whose currency, however, has hit an 11-month low against the dollar, according to Reuters. (This will make the CNMI a more expensive destination for Japanese tourists.) Those who want to promote the CNMI in China — the islands’ no. 2 market prior to the pandemic — are on their own. The administration is going all in on its pivot toward the U.S. military.
What else can be done?
Maybe throw in “economic diversification” — an idea that has been proposed and discussed since the TT days. Create yet another committee or task force, or designate an existing agency, to come up with “alternative” industries, and a list possible constraints and challenges, and what steps should be taken to address them. All this has been done before, but not a lot of us remember everything that has happened in the past, however recent. Besides, if it can’t be Googled, it probably didn’t happen.
No quick fix (but don’t tell voters)
IT takes time to tap new tourism markets or revive old ones. And it takes a lot of time (and effort) to persuade legitimate investors to do business in remote, faraway islands right smack in typhoon alley — with a declining population, labor shortages, rising costs, inadequate flight service, and an exasperating government bureaucracy manacled by federal rules, many of which don’t make sense even if applied to the states.
The CNMI, moreover, is competing with other more attractive, more business-friendly and/or less expensive destinations and jurisdictions. The CNMI is competing with them for investors, tourists and even workers.
If improving the economy is an easy task, it would have been accomplished already, what with all these educated, talented, dedicated, hard-working, heart-of-gold, for-the-people officials who are elected into office every two or four years.
What is truly easy though is for the government to come up with flimsy revenue projections so it can continue spending money it doesn’t have.
Meanwhile
THE business community is trying to overcome many challenges, including those imposed by faraway bureaucrats like the poorly implemented CW touchback provision. Soon, moreover, businesses and other taxpayers will have to pay more to this hapless government, which is run by politicians who are unable to do what is right — like requiring the government to live within its means — if they believe it will imperil their political careers.
Happily — and this is why the CNMI can never be like other crisis-plagued Pacific island jurisdictions wracked by civil unrest — the local people are citizens of the U.S, which still has the world’s largest economy. Locals, if they want to, can relocate to any of their huge nation’s 50 states and other territories.
It seems that more and more residents are realizing that if casting ballots on election day cannot fix a broken economy, voting with their feet can improve their economic prospects.
