Chamber: 12 daily flights needed

Saipan Chamber of Commerce director Ron Smith said in order for the CNMI tourism industry to survive it needs a minimum of 12 daily flights—ideally seven from Korea, four from China, and one from Japan.

Speaking before the Rotary Club of Saipan’s weekly membership meeting last Tuesday at the Crowne Plaza Resort Saipan, Smith was invited to help the service organization get a better grasp on the current economic situation by sharing a bit of what was discussed at the Chamber’s 2nd Economic Forum last May 16.

Smith said the 12 daily flights is the barebones minimum just to keep not only the CNMI tourism industry’s head above water, but the Commonwealth economy in general, which is pretty much dependent on visitor arrivals.

“These direct flights will allow us to recover a little bit and you can see some of the other statistics in regards to Chinese visitors and how important they are. For 40% down to 3% that is accounting for a large percentage of the current drop that we’ve seen, so regardless where it’s from, we don’t really have a preference, but we need a third market and it’s got to be a robust one. It’s got to provide us with bringing 200,000-300,000 visitors per year.”

He also shared current statistics of the CNMI tourism economy during the Rotary Club meeting and also how the dwindling number of visitor arrivals is affecting the viability of hotels on the islands.

“Currently if you take a look at the statistics, you can see that arrivals are down 54% compared to 2017. This is significant and is having profound impacts on our economy. We’ve already lost the Hyatt [Regency Saipan] and other hotels are evaluating their continued presence in the CNMI based upon the performance of their properties this summer. So that’s going to be a defining moment for the CNMI. If they don’t have enough guests coming in to maintain their properties at a profitable point, they are going to consider departure.”

He also shared the Chamber’s plan to survive the crisis, dubbed Operation 500K to bring in 500,000 visitors a year.

“Operation 500K represents 500,000 tourists which basically is the baseline whereby the operators and owners of the properties in the CNMI can break even. Just breaking even, stopping losses that we are currently experiencing. In order to achieve market share, approximately 90% which is what we need, these are the numbers we are going to need to see.”

Smith noted that this was only a survival plan and will not create a booming economy and was only to “stop the bleeding.”

“With 54% revenue coming from visitors, tourists count for 54% of all business revenue made in the CNMI. That’s profound because we are talking about all business revenue from all businesses both internal and external not just tourists everything so that’s a big chunk of our economy if we do not have our guests we lose half,” he said.

Showing more statistics from the past, Smith shared that in 2023, a total of 215,543 tourists visited the CNMI compared to 487,008 in 2019. The projection for 2024 is a rough estimate of 300,000 tourists will visit the islands. As such, based the latest figures the islands’ tourist arrivals and hotel occupancy rates are still significantly below their pre-pandemic levels.

“We have to have sustainable visitor numbers in order to keep the hotels open,” he said.

With many of the Rotarians being business leaders and owners, they have also suffered from the economic situation.

In a conversation with the club’s president Irene Holl, she said, “It’s a challenging time for the CNMI looking at the data that Saipan Chamber presented today. What we hope to see is how the government and the people will work together to survive this crisis. We need to act fast in implementing solutions and ideas may take time. People are already affected. At the Rotary, we already approved reducing the number of meetings to alleviate financial burden to members. The club already lost quite a number of members due to the hardship, and we are expecting more during our next administration. Sad, but we still need to keep up hope.”

According to the MVA, the CNMI currently has 23 weekly flights from Korea, three from Japan, two from Hong Kong, but zero weekly flights from China.