CNMI ditching Chinese travelers in favor of military tourists
By Bryan Manabat
Saipan— Paradise destination. Military buildup. Tourism. Geopolitics. In this new era of the cold war, these concepts are all connected, driving local policy decisions, if not raising concerns in the community.
In the CNMI, Gov. Arnold I. Palacios has expressed his administration’s intention to ditch the Chinese tourism market, citing the growing geopolitical tension between Washington and Beijing.
In a March 15 letter to Adm. John Aquilino, commander of the U.S. Indo-Pacific Command, Palacios said the CNMI “is very much committed to U.S. national interests in our region and will do what we can to advance these interests as geopolitical tensions continue to heighten.”
Palacios said the CNMI will "pivot away from its reliance on the Chinese tourism market, which comprised more than 50 percent of our tourism base, or about 200,000 visitors (pre-pandemic)."
The China market has been the CNMI tourism industry’s bread and butter. Prior to the global Covid-19 pandemic, China was the CNMI’s second largest source market next to South Korea. The CNMI-only visa waiver program allows tourists from China, including Hong Kong, to visit the commonwealth for 14 days without a U.S. visa.
In 2019, arrivals from China totaled more than 180,000. In 2020, it dropped to 18,550, and below 200 in 2021 and 2022.
Palacios said the decline in Chinese arrivals has had a considerable adverse economic and financial impact on the commonwealth’s revenue. "This loss, which represents a sizable portion of the CNMI's tourism revenue, contributes to vulnerable economic conditions that in the past have been exploited by the Chinese Communist Party to the detriment of the United States' interests in the region,” he said.
In anticipation of the shortfall, the governor sought funding support from the Department of Defense. “We are formally seeking your advocacy for additional funding support to stabilize our economy as you testify before the U.S. Congress about the Department of Defense's budget,” Palacios wrote.
“Specifically, we request your support in seeking direct aid to replace the economic loss that we have experienced as a result of the CNMI's pivot away from China.”
Palacios said the CNMI is now working to strengthen and further develop the tourism pipeline from American allies, including Japan and South Korea, while the Marianas Visitors Authority seeks opportunities in other markets.
In general, local residents are in favor of military buildup and more federal spending in the CNMI.
The Commonwealth Bureau of Military Affairs, in collaboration with the Saipan Chamber of Commerce and the MVA, is now developing tour packages marketing CNMI as a "military destination."
The Chamber invited the NMI business community to a presentation by the Joint Region Marianas-Morale Welfare Recreation as they shared information on how businesses can promote and gain exposure within the military market.
But not everyone is embracing the idea of a "CNMI military getaway."
Ignacio Dela Cruz, an educator, is unhappy with the governor’s new posture and questioned whether the administration considered the ramifications and negative impact of a “militarized” CNMI on the environment, infrastructure, and society at large.
Dela Cruz is against putting the civilian population in the back seat for the military and cited the sister territory, Guam, as an example. "Guam has had military installations for many years, but they have hardships too. So, it does not mean the military industry will be the answer to our economic woes," Dela Cruz said.
“As CNMI residents. it is our right and duty to speak up about things of grave concern to us. Our leaders need to think very hard about us, their constituents, before inking any deals or committing themselves, committing the CNMI to the hands of the military,” he added.
As far as he is concerned, Dela Cruz said “the military is taking full advantage of our economic hardships. By throwing money in our faces, the military is now telling the CNMI to get on the stage and dance for money. I hate to make this comparison but, for the lack of a better comparative point, this is how I see it.”
Joe Guerrero, chamber president, said the vision is not to replace tourism with military industry. "Economic activity in the CNMI has started already, for what we understand there are more plans for military spending,” he said. “We hope the U.S. military pushes through with it. All of these are great news for businesses in the CNMI because this is one of the ways, which have talked about for many years, to diversify our economy. We are looking forward to that."
Danny Aquino, the governor’s special assistant for military affairs, said the administration would welcome more military exercises and offer MWR or staycation packages for service members and their families."
Aquino encourages businesses in Saipan, Tinian, and Rota to register and get a System for Award Management number. "The military prioritizes businesses with SAM numbers," Aquino said. "We have an Innovative Readiness Training or IRT training coming up from July 9 to 22. Now is a perfect opportunity for businesses to start registering, to start being prepared for more military personnel coming to the CNMI for training."
On Tinian, the $162 million divert airfield construction project is slowly progressing and the population of military personnel on island is noticeably growing.