CNMI looks to CIP •Gov’t outlines plan to spend its way out of economic crisis

In what may be its only hope amid worsening economic crisis, the NMI government is bent on forging ahead with a massive infrastructure projects to stir local business and provide employment to island residents.

A master plan listing down Capital Improvement Projects with financial assistance from the U.S. government is expected to be unveiled soon by the administration, according to legislators.

The list will set into motion priority projects here to be funded under Section 702 of the Covenant which provides federal assistance each year to the CNMI for its infrastructure development plan.

Legislators are scheduled to meet with public works and finance officials this week to start planning on proposals outlined in the master plan, said Senate President Paul A. Manglona.

“We need to work with the administration so that we can see these projects bid out, awarded and constructed as soon as possible,” he told in an interview.

“Whatever project that we can move right now, we have got to get them going,” the senator added.

Some $154 million in shared funds between the CNMI and Washington will finance these projects, including the proposed new prison facility and the closure of the Puerto Rico dump site.

The money will be made available until year 2002 under the $77 million federal grant, while an equal amount is to be raised by the island government to match the CIP funds.

“We will get this money out and we will start doing the projects so that hopefully we will be able to stimulate the economy,” Manglona pointed out.

The funds have remained idle since 1996 due to CNMI’s failure to match the assistance dollar-for-dollar. Local leaders have blamed the deepening financial crisis for its inability to meet the requirement.

But Manglona maintained the CIP Task Force headed by Mike Sablan has already identified more than $58 million in local money to tap the idle funds.

He added that the legislature is soon to pass legislation allocating these funds for projects in the priority list in an effort to perk up the slowing business activities on the island.

House Ways and Means Committee chair Karl T. Reyes also said the capital-intensive projects will have a multiplier effect on the economy that will eventually boost revenues of the government.

“CIP funds will help revitalize our economy as these will pump money into the island,” he said.

The Northern Marianas is reeling from its worst crisis in years spawned by the collapse of most economies in Asia, its main source of tourists and investments.

By undertaking infrastructure development, CNMI officials hope that the infusion of fresh funds into the economy will help arrest continuous decline in revenues and massive lay off due to closure of more than 1,000 businesses in recent months.

According to Reyes, various projects costing $38 million are scheduled to begin their construction in the next few months as part of the $88 million in CIP funds targeted by the NMI government for the entire 1999.