Fast-track establishment of new industry urged

There is a need for the CNMI government to identify and nurture another industry from where it can rely on for revenues in case the very volatile tourism sector suffers yet another slump, according to Commonwealth Development Authority Board Chair John S. Tenorio.

Mr. Tenorio said local efforts should begin this early to diversify the local economy to mitigate possible impacts of the anticipated pullout of the garment manufacturing sector in 2007.

He said the apparel manufacturing industry in the Northern Marianas has kept the Commonwealth’s economy afloat amid the trickling number of visitors coming into the islands during the last two years.

CNMI suffered a sharp decline in visitor arrivals following the collapse of the Korean economy, which was a by-product of the investors’ loss of confidence in Thailand in July 1997.

While the situation slightly stabilized since the beginning of 1998, a new — and even catastrophic — currency devaluation snagged Asia during the second quarter of the year as driven by the loss of confidence in Japan’s capacity to reform its economy, particularly its financial sector, as well as uncertainty about the Chinese yuan.

And since then, growth in the garment sector has been making up for the dramatic drop in the number of visitor arrivals to the CNMI, said Mr. Tenorio.

Stressing that tourism and the garment sectors have been the vital industries in the Northern Marianas, the CDA board chair said the decline of one can be saved by the growth of the other.

“We must admit that tourism and garment manufacturing are keeping us going. The decline of tourist arrival figures in the Northern Marianas is hurting us but we can’t just imagine how badly we will be hurt without the garment sector,” he explained.

He pointed out that the healthy condition of the United States’ economy is working to the advantage of the CNMI’s garment industry. The garment sector, composed of about 30 small-and-large-scale firms, is now CNMI’s biggest employer.

The sector accounts for about 21 percent of the 30,000 foreign workers employed in the Northern Marianas. It was the fourth highest economic contributor, accounting for 12.7 percent of the $2.26 billion business gross revenues reported in 1995.