CONTINENTAL MICRONESIA PREDICTS CONTINUED DECLINE IN TOURISTS FROM JAPAN TO

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MICRONESIA AND HAWAI‘I

By Lindablue F. Romero

SAIPAN, Northern Mariana Islands (January 5, 1999 - Saipan Tribune)---Continental Micronesia has projected a three percent decline in Japanese traffic in Micronesia and Hawai‘i as the Japanese economy remains in the dump.

Japan, the world's second largest economy, plunged into its deepest recession since World War II after the collapse of the speculative "bubble" economy of the late 1980s.

Wally Dias, staff vice president for sales and promotions, said the airline has no plans to add flights or new routes in Micronesia and Asia as long as consumer confidence remains weak.

"We're just hoping it won't go down further so that we can just fill up the current capacity," said Dias.

Continental, the biggest carrier in Micronesia, captures half of the total Japanese outbound market in the region. Last year, Continental projected a three percent growth in traffic for the Northern Marianas, a 12 percent drop from the usual 15 percent growth which the islands had been enjoying.

The airline has cut back its service between Saipan and key cities in Japan to further reduce huge losses as it projected the Asian economic woes to last until the year 2000.

Due to the currency crisis, the airline has scaled down by 22 percent the assigned seat miles and by 18 percent its flight activity after tourist arrivals suffered a double-digit decline.

This was severely criticized by the CNMI government as it expressed concern over its effect on the half-a-billion-dollar-a-year tourism industry. Airline officials, however, defended the move saying it was purely a business decision due to the downtrend in tourism.

Dias noted that the Japanese have started looking for destinations that offer cheaper packages, one proof that their spending habits have drastically changed as a result of the problems besetting the region.

According to Dias, Continental will continue to work with the Marianas Visitors Authority in promoting the Visit the Marianas '99 Campaign. In 1998, Continental brought back the "Proud Bird" golf tournament which will be held again on Saipan this year.

The U.S. carrier, whose parent company is Houston-based Continental Airlines, has been servicing the Micronesian Islands for the last 30 years with flights from Hawai‘i and other cities on the mainland as well as Tokyo, Seoul, Manila, Hong Kong and other Asian capitals.

For additional reports from The Saipan Tribune, go to PACIFIC ISLANDS REPORT News/Information Links: Newspapers/The Saipan Tribune.

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