‘A lot hinges on passage of Kilili’s bills’

If all comes to fruition, the CNMI can expect about 9,800 additional hotel rooms to potentially spur the CNMI to a peak it last hit in the ‘90s, according to Saipan Chamber of Commerce president Alex Sablan. However, this could all go up in smoke if legislations being pushed by Delegate Gregorio Kilili Sablan at the 11th hour are not passed.

In an interview yesterday, the Chamber president said that based on potential new projects declared by new investors, the Chamber is looking at almost 9,800 new rooms for the CNMI.

The new total accounts for proposed E Land, Honest Profit, and Best Sunshine hotel and casino developments, among other hotel developments, according to Sablan.

He said there are “thousands of jobs attached” to Delegate Sablan’s legislation to extend the asylum time bar, the E-2C foreign investment visas—which account for 200-plus investors in the CNMI, according to the president—and legislation to exempt the CNMI from the H2 visa cap.

The bills would extend for five years the bar on applications for asylum in the Northern Mariana Islands, the exemption for Guam and the Northern Marianas from the national numerical cap on H visas, and the E-2C visa for investors grandfathered in from the Commonwealth’s immigration laws.

“If we do not get these [bills] passed, we potentially will lose the parole status of the Chinese and we will lose 200-plus foreign investors who will not stay around to change their visa from E-2C to whatever else is available,” he said.

The parole authority as granted to Chinese and Russian tourists by the Department of Homeland Security allows these tourist to enter the CNMI without a visa.

“The problem we have is there is a limitation in the current foreign investment visa requirements [where] a development has to be at least a half a million dollars or more investment. A lot of these small businesses don’t fall in that route; they fall in the current E-2C, which is $50,000 or more. To lose this backbone in our economy because we don’t have the extension, it will be an extreme hit to our bottom-line here,” he said.

Inevitably, he said, the CNMI would see these businesses up and sell, or leave.

In the “bigger picture” is losing the asylum time bar, Sablan said. This would hamper the CNMI’s ability to maintain the parole status for Chinese visitors, he said.

“If that parole status goes away, obviously the Chinese visitors, the Chinese market goes away with it. And that is a significant market. It is already one-third of our visitor arrival market in the CNMI, and is potentially the biggest growth market by far over the next decade or two,” he said

The Japan market would not be expected to make up for this loss with its current recession and devaluation of the yen. He said the Chamber is concerned the Japan market will not grow.

“[The yen has] dropped 40 percent in the year and a half. That obviously does not spell well for tourism because it becomes a little more expensive to come here, and if they are going to go off someplace and spend that money they are going to go off in another direction,” he said.

The additional rooms would be the greatest number of rooms the CNMI has ever had. If the CNMI could fill those rooms, Sablan said, it could experience about a million and half to 2 million visitors a year.

Right now, rooms are double what they used to be in 1997, the CNMI’s best year, according to Sablan. With 726,000 tourists that year, the existing 33,000 rooms were made up of the existing rooms the CNMI has today plus the Palms Resort and the Plumeria and Riviera hotels, which have all closed in years past.

“The hotels that are not here that contributed to that opportunity—Palms, Plumeria, and Riviera—all those three helped contribute to the overall number. Because they are not open we are not able to grow the market. We are hopeful with the E-Land builds, the Best Sunshine development, and the Honest Profit development, the reopening of Palms, Coral Ocean Point, and the Riviera Hotel that we can spur the growth to hit our 700,000 mark probably in a year to a year-and-half,” he said.

Down the line, he personally thinks that Best Sunshine may have to “rethink” their plans if the Chinese market were to go away.

“The casinos attach largely to the Chinese market—obviously they would like to entice every market—but a Chinese developer would pursue Chinese tourists. So we believe the market will be impacted dramatically without this legislation passed at the end of the year.”

In its history, the CNMI has not seen the stability of room allocations and percentages at 75 to almost 80 percent year round since the height of the tourism boom in 1997. If the CNMI wants to continue to see 75 to 80 percent room occupancy, it would have to build all markets but especially the Chinese market, according to Sablan.