AMONG U.S. INSULAR AREAS Volume of federal money lowest in NMI

If it is any indication, the volume of federal greenback circulating around the Northern Marianas economy is at its lowest compared with those in other insular territories in Micronesia and the Caribbean, according to a report from the Office of the Governor.

Commonwealth officials point out that this only proves that the CNMI was able to develop a self-reliant economy, spurred by growth in the business sector, with 100 percent of its government operations being financed through locally sourced revenues.

Mike Sablan, the governor’s special consultant for budget and finance, disclosed that the Northern Marianas gets the lowest amount of grants from the federal government compared with other insular areas like Guam, the U.S. Virgin Islands and American Samoa.

He said the U.S. Virgin Islands continues to get the highest appropriation from the U.S. government, cornering close to $380 million in total grants although most of it were earmarked to fund government emergency plans for typhoons and hurricanes.

Guam received $134 million in federal grants while American Samoa had over $70 million. In the same period, the U.S. government earmarked only about $30 million to the Northern Marianas.

The presence of a naval and airforce base on Guam, with thousands of military personnel, spurred the growth of the volume of federal greenback circulating around the island’s economy at a whooping $827 million.

Federal spending in the Caribbean territory of the U.S. Virgin Islands was recorded to have reached $563 million; $108 million in American Samoa and only about $44 million in the Northern Marianas.

The U.S. Congress’ investigative arm — the General Accounting Office — has even confirmed that the CNMI has risen to be the most fiscally self-sufficient among other U.S. outlying areas like Guam, Puerto Rico, the U.S. Virgin Islands and the Freely Associated States.

The ratio of locally derived government revenue to gross domestic product in the CNMI is also higher than that of most other outlying areas and is larger than the comparable ratio for all levels of government in the U.S.

GAO said the Commonwealth government obtained about 87 percent of its general revenue from local sources while payments from the U.S. Treasury accounted for 13 percent.

In 1998, the garment industry contributed 22 percent of the government’s $234 million budget. The tourism sector pitched in 14 percent of the Commonwealth’s $248 million budget in 1997.

A study funded by the Department of the Interior noted that about 21,600 jobs in the CNMI economy were dependent on the garment industry, which constituted nearly one-half of all employment in the Commonwealth.