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Decline in construction sector noted By ALDWIN R. FAJARDO
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Posted on Jan 17 2000
Not even the construction industry in the Northern Marianas was spared from the hex of external economic forces, manifested by a sharp decline in the number of building permits issued by the Department of Commerce last year.
The commerce department’s Economic Development Division issued only 93 building permits during the second quarter of 1999, dropping from the preceding quarter’s 119.
During the same period in 1998, the government approved 122 construction permit application, involving at least $20 million.
At least 37 or $15 million of which were intended for commercial establishments while 85 or $5.9 million were for residential units.
In terms of value in US dollars, activities in the islands’ construction industry dropped by $7 million to $7.8 million in January to March 1999 compared with the previous year of the same period’s $14.8 million.
The CNMI witnessed only about 22 construction activities in the commercial sector, which involved $1.2 million, during the second quarter of last year.
This figure is lower than the previous year’s 33 approved permits.
In the residential sector, the commerce department issued 71 building permits, entailing $3.3 million, during the period under review, dropping from the previous quarter’s $4.4 million for the construction of 86 residential units.
Housing loans approved by the Commonwealth Development Authority, and its commitment to release 1,000 home loans by the turn of the century helped minimize the decline in the residential sector.
Development Authority chairman John S. Tenorio disclosed the Northern Marianas Housing Corp. has approved roughly about 900 housing loans within the last two and a half years and intends to close a thousand loans by year-end.
Mr. Tenorio said the significant increase in last year’s real estate loans from commercial banks and CDA was fueled by a bigger demand for home refinancing because of the lower interest rates.
Interest rates have dropped from 10 percent to 11 percent two years ago to between eight percent and nine percent now.
