Inos asks Korea for ‘alternative penalty’ on Asiana

Gov. Eloy S. Inos asked the South Korean government on Friday to consider assessing an “alternative penalty” on Asiana Airlines over safety rule violation instead of suspending its flights to and from Saipan for seven days, the potential impact of which on the CNMI economy is estimated at $6.7 million based on a load factor of 80 percent.

The governor told Korea’s Minister of Land, Infrastructure and Transport Suh Seoung-hwan that while the CNMI fully understands Asiana Airlines’ breach of safety rules, it is also deeply concerned that the proposed flight suspension penalty would cause “economic injury” to the CNMI.

“As you may know, tourism is our sole economic driver and visitor arrivals from Korea account for 35 percent of our total visitor mix. Asiana Airlines is the sole carrier between our two countries; and a suspension as recommended will cause economic injury to the CNMI’s already fragile economy,” Inos told the minister in a one-page letter.

While the governor fell short of suggesting a specific type of alternate penalty, some officials including House Tourism Committee chair Ralph Yumul (Ind-Saipan) said yesterday that a monetary fine on Asiana Airlines would at least cushion the economic impact on the CNMI.

“By suspending Asiana’s flights, the CNMI will be indirectly penalized because that translates to millions of revenue loss for the CNMI. Suggesting an alternative penalty, which could be monetary fine, is a step in the right direction to protect the CNMI from the actions of the airline crewmembers,” Yumul told Saipan Tribune.

The governor said it is the CNMI’s understanding that Asiana Airlines acknowledges its safety violation “and will not dispute the government of the Republic of Korea’s action.”

He said the CNMI fully understands that Asiana Airlines’ breach of safety rules comes at a sensitive time following the Sewol ferry accident, and that his letter does not serve to interfere with this process or the ministry’s effort to reinforce safety measures with its national carriers.

But the governor said the CNMI is “deeply concerned” about the proposed penalty to suspend air service from Korea to Saipan for seven days.

“In this regard, and with respect to the function of your office, my office and the people of the CNMI request your consideration in assessing an alternative penalty for Asiana Airlines’ breach of safety rules instead of the suspension of flights,” Inos told the minister.

Marianas Visitors Authority managing director Perry J. Tenorio earlier said suspending Asiana Airlines flights to Saipan for seven days could result in an estimated $6.7 million economic loss to the CNMI based on a load factor of 80 percent.

MVA said Asiana Airlines is currently providing 3,774 seats per week to the CNMI.

Korea’s Ministry of Land, Infrastructure and Transport announced two weeks ago a suspension of Asiana Airlines’ flights to Saipan for seven days for continuing with a passenger jet flight, OZ603, from Incheon to Saipan on April 19 despite discovering signs of engine trouble after takeoff. A warning light came on, signaling a problem in one of the plane’s two engines.

New law, CUC appointee

In other news, the governor signed into law on Friday a bill providing the Public Utilities Commission with the authority to require management audits of regulated entities.

Rep. Christopher Leon Guerrero’s (Cov-Saipan) House Bill 18-151, House Substitute 1 is now Public Law 18-52.

The governor also appointed on Friday Evelyn M. Mendiola to serve on the Commonwealth Utilities Corp. board of directors representing Rota.

Mendiola’s initial appointment requires the Senate’s advice and consent. If confirmed, Mendiola will serve a four-year term that shall begin on the date of her confirmation.