GAO: Without workers, CNMI GDP will sink

Posted on Nov 09 2017

If the CNMI is denied continued access to foreign workers, the Commonwealth’s gross domestic product would significantly plummet, according to acting CNMI Labor secretary Vicky Benavente, citing a U.S. Government Accountability Office report

“I spoke with the U.S. GAO in my first two days on the job and they had a lot of questions about how, why, and what we plan to do about the CW situation.

“U.S. GAO has a report that says if we were going to remove all contract workers from the CNMI, the GDP will decline by 26 to 62 percent,” she said, speaking at the Saipan Chamber of Commerce meeting last Nov. 2 at the Hyatt Regency Saipan’s SandCastle.

“Twenty-six to 62 percent amounts to millions of dollars,” she added.

In mid-October this year, the Bureau of Economic Analysis released a report stating that the CNMI’s gross domestic product grew by 28.6 percent in 2016.

In a U.S. GAO report released early last month, it noted that, although the CNMI economy of fiscal year 2015 was in much better shape compared to fiscal year 2005, its reliance in foreign labor—set to end on Dec. 31, 2019—could impede the Commonwealth’s ability to repay its debts.

U.S. Public Law 110-229, the Consolidated Natural Resources Act of 2008, brought in federal control of the CNMI’s immigration system and phases out of the nonresident contract workers, also called the CW program.

Benavente said the intent of the U.S. Congress is to give the CNMI as much flexibility as possible in maintaining businesses and other revenue sources and developing new economic opportunities.

“I would like to encourage the business community to update data in the website,” said Benavente.

“We need data so we can work with U.S. Citizenship and Immigration Services and all the other agencies of the federal government who are looking into having us comply with Public Law 110-229,” she added.

Benavente recalled that the CNMI recorded 51,000 total workers in 2001. Seventy percent of these were CW workers.

“In 2015, we have a 25,000 workforce and nearly half of those are U.S. citizens or CNMI permanent residents. In just two years, we have gone through a real significant shift,” she said.

The shift happened notwithstanding challenges that the business sector and government experienced.

“On the business side, the challenges involve recruiting workers and keeping them in the workforce. There are challenges on training because we are trying to survive and stay competent. On the government side, we need data. We need a lot of data and compliance in the regulations of not just the Department of Labor but all the departments and agencies across the board and this will help all of us,” Benavente added.

Bea Cabrera | Correspondent
Bea Cabrera, who holds a law degree, also has a bachelor's degree in mass communications. She has been exposed to multiple aspects of mass media, doing sales, marketing, copywriting, and photography.

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