Japanese tour operators close shop

Tokyu travel agency has already informed its clients that it will stop doing business on Saipan on January 15 as its main company Tokyu Tourist Corp., which is also involved in retail and construction businesses, cut down its operations, said Kiyoshi Aikawa, president of Japan Saipan Travel Association. Tokyu has been in operation on the island for the past 10 years.

Japan, the world’s second largest economy, plunged in its deepest recession since World War II after the burst of the speculative “bubble” economy in the late 1980s. This led debt-ridden financial institutions to scale back on lending, starving companies of cash.

Aikawa noted that the shrinking Japanese market in the travel industry has made it difficult for some tour companies to survive. “Some of these companies did not earn in 1998 because of the crisis,” he said.

While the main company in Tokyo has not made any official announcement, Toshiyuki Kawashita , general manager of Nippon Express Corp. (NEC), said the company will no longer operate in April after 14 years of doing business on Saipan.

Kawashita said NEC was able to bring in only some 3,300 Japanese travelers to CNMI in 1998, almost half of the tourists it was able to send to the island in 1997. The number does not include the cruise ships handled by the company that visit the CNMI.

NEC has been laying off workers as the main company in Tokyo implement a restructuring program in order to survive. In Japan alone, it has some 50,000 employees and an additional 10,000 worldwide. It has 250 branches all over the world.

Before NEC closes its operation, it will facilitate the arrival of two cruise ships carrying more than 2,000 Japanese students. On Jan 11 and 13, Orient Venus will make a port of call and Shin Sakura Maru will arrive in March.

“It is very difficult now to bring in tourist here because of the currency crisis in Asia,” he said. Kawashita noted that Japanese travel agents have been experiencing difficulty in enticing travelers to visit the CNMI because some destinations have offered cheap packages.

Japanese have also turned to domestic travel as some places in Japan such as Okinawa and Hokkaido, which used to be very expensive destinations suddenly became competitive.