‘Expanding travel bubble crucial to restoring lessened revenue’

Finance Secretary David DLG Atalig said the planned expansion of the CNMI’s travel bubble program to other foreign market partners like Japan, China, Hong Kong, and Taiwan are necessary options for the Commonwealth to pursue to restore diminished government revenue.

In discussing the CNMI’s financial outlook in his Fiscal Year 2020 Annual Report that he recently submitted to Gov. Ralph DLG Torres, Atalig said the proposed travel bubble being worked among the CNMI government, Marianas Visitors Authority, and South Korea market partners will allow for a partial resumption of tourism from South Korea to the CNMI, while maintaining strict adherence to the domestic COVID-19 mitigation guidelines.

Citing Atalig’s report, Torres early this year notified the Legislature that the total spending and obligations for fiscal year 2020 exceeded the appropriated resources by $133,172,087.

That means a deficit of over $133 million. Of that amount, $85 million was a direct result of the COVID-19 threat and mitigation efforts used to keep the CNMI as safe as possible from the spread of the virus.

Amidst the pandemic, Atalig said, the CNMI has some opportunities to rebound toward the end of fiscal year 2021. “The arrival of COVID-19 vaccines gives the CNMI opportunity to return to normalcy. This includes reaching large-scale adoption of the vaccine, resuming full domestic commercial activity, and the resumption of travel arrivals to the Commonwealth,” Atalig said.

With the recent approval of the second pandemic relief and government funding measure, the Commonwealth could see an increase in federal funding necessary to continue the fight against the spread of COVID-19 and address the shortfall of available resources for the continued administration of government services, he said.

Also, with the recent extension of the Pandemic Unemployment Assistance program, a consistent yet decreased level of personal consumption expenditures can be anticipated, however, the program maintains “a sunset prior to the end of fiscal year 2021.”

Atalig said should there be no extension and in the absence of a larger scale resumption in tourism activities, there will be a decrease in spending in the local economy.

“This will lead to a contraction in tax revenue and reducing the opportunity for the economy to improve. Should this be the case, the CNMI will experience another year of stagnation,” he said.

Expressing optimism, Atalig said despite the continued uncertainties for the resumption of the CNMI tourism industry, legislation geared toward generating revenue and encouraging business development can aid in meeting fiscal year 2021 revenue projections.