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Sunday, April 20, 2014

Suggested methods and actions to promote our economy

Anthony Pellegrino

We in the CNMI have many opportunities to create a prosperous economy, but somehow we fail to do so. For some inexplicable reason we fail to see that we are surrounded by many opportunities. So as usual I am going to stick my neck out and discuss some of them in the hope that some of us will consider their economic possibilities. Frankly speaking, some of the ideas are ones that were shared with me by Bill Stewart over a year ago. After reviewing them, think why they have not been implemented.

Have we identified and documented business opportunities open to foreign investors? Do we do any advertising to let foreign investors know what we have to offer? Are we using the Internet, trade journals, Wall Street Journal, or the Asian Economic Review? Do we send out trade missions seeking investors? To encourage investors to come here we must reach out. What advantages do we offer them in selecting our CNMI over other locations?

Why not display a large sign at the airport displaying a welcome to potential investors and informing them who to contact for more information about business opportunities? Do we have anyone in the government who is qualified to service intelligently all inquiries for information from potential investors completely and promptly? Why not assign a particular individual to each investment inquiry and project? Then follow up!

We cry about the decline of tourists but should their number increase, where do we house them? The Palms Resort has been shuttered for a long time with no date for reopening. The Plumeria Hotel has fallen into such terrible condition that several investors who looked at it realized that it would be cheaper to tear it down and rebuild than to renovate it. Why did we let this happen? Where are our hotel rooms for increasing tourism? Recently a new airline opened up and will be flying many more tourists to Saipan supposedly in January. Where will they be housed?

Just recently the newspapers discussed a “deal” about an ice breaker ferry boat that the governor is interested to carry passengers and cargo or cars between the islands of Saipan, Tinian, Rota, and Guam. But it need not be a secret because funds are available for such an investment. There is a federal program providing government guarantees to enable ship owners to borrow private sector funds on terms that may not otherwise be available. The program guarantees up to 87.5 percent of a loan at fixed rates with a long-term maturity. Anybody interested? Check it out.

For the small local business person, check out some of the following ideas that can produce a profitable business. Consider papaya jam or marmalade. How about pickled and canned papaya, frozen papaya, papaya juice, banana chips? We can make pudding, frozen or canned mango juice. Growing flowers as a business has always been a good business. They have a high value in relations to bulk and can be flown to Guam or to Asian markets. The list goes on. It is limited only by our imagination.

It appears that many retirees have been withdrawing and will continue to withdraw their full retirement checks before the Retirement Fund goes totally belly up. In some cases this will amount to a sizeable amount of cash. What to do with it to receive a safe and good return? Depositing it in a typical certificate of deposit in a bank will return about 1 percent to at most 2 percent with no appreciation of money. While a CD is a safe place to place the money, it will never grow. Unless you are skilled in playing the stock market, stay away if you don’t want to lose your money. But there is a better place to invest it in where your money will grow over the years.

Think of all the houses for sale on Saipan. Consider buying a property in a good community or with a good view and rent it out to visitors. Many of our citizens are fleeing the islands so make an offer they cannot refuse. Being an indigenous citizen you can own the land. Over the years the house and land will appreciate in value. Many banks will give out mortgages for a fraction of the total cost and appraised value of the property. Suppose we buy a house for $85,000 with 25 percent deposit with the balance repayment spread out over 20 or 30 years. Let’s say the monthly mortgage is $400 plus or minus. Now we rent the house for about $500 per month. The rental income pays our mortgage, and eventually we own the house and land with it. The house and land will appreciate over the years. Initially we put down only 25 percent. Wow! What a deal!

Frankly speaking, I am currently doing this and it is working. Our land and houses will appreciate. I have seen this happen in Japan and I have seen this happen in Hawaii. Check this idea out with your friendly real estate agent and see if it works or not.

Let me digress for minute and touch on a delicate but serious subject. We are slowly being deprived of our nonresident labor force by our federal government. As we are all aware we are burdened with CW1 status workers and no one except the federal government knows what will happen in 2014. Will we have workers or not? How can any of us in business expand or how can any investor desire to invest here when there is so much uncertainty? Is anyone in the local government assigned to dialogue closely with the federal government to help resolve this major problem? Or are we just waiting for the other shoe to drop?

I find it difficult to accept the fact that about 11,000 of our local people are on food stamps and about 11,000 nonresident workers are working here. How do we explain this to ourselves? To me this is one of our most serious contradictions. Why does our government look the other way on this matter? Why is there no motivation and incentive given to people to encourage them to become employees instead of food stamp liners up? We should encourage them to become workers and earn their own bread. Yes, I seem to simplify a complex problem, but we must wrestle with it and not turn our eyes away. Our people must become the workers of our community.

We have a prosperous market directly south of us—Guam. We have so much in common yet we act as though we are strangers to one another. There is so much that we can do to benefit each other. Instead we seem to compete against each other. Our two governments should be working closer together. We need each other. We can become their food basket. Tourism can be extended to include our islands as well as Guam. But then, I am a dreamer.

As I repeatedly state, I am not trying to solve all our problems but I am trying to get us to think about how to solve them. Unfortunately we have egos that keep us apart and do not let us stretch our hands in cooperation. Problems are created by us and thus we can solve them if we desire to. Remember: poverty is a state of mind; being broke is a temporary situation. Let’s start becoming prosperous again.

It is sad to see and hear all the negative thoughts running through our community when we should be more united than ever. Review the statistics published in the media this past week about the imbalance being created among the indigenous and non-indigenous population. Where are our people fleeing to and why? Is there nothing we can do to reverse this trend? Maybe it is better. Years later we can read about the Marianas Islands called Saipan, Tinian and Rota. Think it cannot happen? It’s not too late to fix up our islands. But then I am a dreamer!

Have a great week and keep smiling! Your smile is a beacon into each other’s heart. Give a smile and receive a smile in return!

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