CNMI HOTEL INDUSTRY LOOKS TO SHAKY 2009

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New federal immigration standards getting tougher

By Junhan B. Todeno

SAIPAN, CNMI (Marianas Variety, January 5, 2009) –- The hotel industry on Saipan did "a little bit better" in 2008 compared to 2007, but will face uncertainty this year when federal immigration law is extended to the islands in June, according to Hotel Association of the Northern Mariana Islands president and Saipan Tribune publisher Lynn Knight.

"We really face a big concern with the continued increase in minimum wage and with federalization," she said. "Everybody is worried about our employees — whether we can keep the same good level of service that we have and…how are we going to afford these things [amid] uncertainties."

2007 was "devastating" for the hotel industry, she added, but in 2008 Japanese and Korean arrivals increased while the Russian market doubled, Knight said.

More Russian tourists have been coming to Saipan recently because they might not be able to visit this year under federal immigration rules, which will require them to acquire U.S. visas.

Hotel managers, Knight said, are hoping that the current flights to Saipan will continue, if not increase.

Continuous air services, she added, contributed to the increase of arrivals from Japan and Korea last year, but local hotels continued to face stiff competition from Guam, Hawaii and other tropical destinations in the Asia-Pacific region.

To promote CNMI tourism, Knight said the Marianas Visitors Authority’s offices abroad are "performing an excellent job" despite the limited budget.

MVA’s promotional efforts need to be maximized, she added.

There’s a need to improve the CNMI’s image as a tourist destination, she said.

"The one area that I would like to see is to work more in branding," Knight added. "We really need to think more about what our image is, what is our catch phase, what is our slogan. We don’t have a catch phase that we use over and over, and that’s something we need to work on."

To prepare for the federalization of local immigration, Knight said hotel executives continue to work closely with the administration, the Legislature and Congressional Delegate-elect Gregorio C. Sablan.

"For me that means talking to them a lot and helping them to understand what the difficulties are, and to try to find ways to smooth things out," she said.

According to Knight, the hotel association and the CNMI government have "very good open communications" on matters affecting the industry.

But their group, she added, is hoping that the administration will not increase business taxes.

"The thing that concerns us now is the talk about raising taxes and about removing the rebates," she said. "In the U.S. the private sector is asking the government for bailouts, but in the CNMI, it appears the government is asking the private sector to bail it out."

The local economy has shrunk, she added, and the government needs to match the size of the economy.

The government, she said, must "look anywhere for efficiency rather than taxing the industry that is putting food on the table."

She added, "We think that they [the government] really should cut their costs."

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