Marshall Islands Gains New Air, Shipping Services

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Singapore-based MELL will ship cargo to Majuro every month

By Giff Johnson

HAGÅTÑA, GUAM (Marianas Business Journal, Dec. 31, 2012) – For small islands in the Pacific, the availability of air and shipping service defines economic opportunities. And, generally speaking, the arrival of a new entrant into these relatively small markets scattered across vast stretches of ocean is a rare development.

So it was not surprising that the local business community was delighted when Mariana Express Lines celebrated its maiden voyage to the Marshall Islands on Dec. 9, and Nauru's Our Airline launched its first regularly scheduled weekly air service to Majuro on Dec. 10.

"We have so much to be thankful for," said Carlos Domnick, CEO of DAR Enterprises and chairman of the government-appointed Aviation Task Force. These developments are "good for our private sector."

MELL, a Singapore-based shipping line that is part of Luen Thai Enterprises, sister company to Tan Holdings Corp. will be carrying cargo into Majuro on a monthly basis from the U.S. and Asia. Until MELL opened, Matson Navigation Co. has been the only carrier bringing in U.S. cargo since the demise of PM&O Line nearly 10 years ago. Although MELL will initially carry cargo only once a month from the U.S., it is offering seven-day service out of Honolulu and 14 days from California - a service that importers of perishable food items will find attractive since currently all produce from the U.S. is now shipped by Matson to Guam, then backhauled into the Marshall Islands. MELL is partnering with Horizon to move cargo from the U.S. West Coast to Hawaii.

The first MELL ship brought in 76 containers and the second ship is expected to bring more than 100 containers just before Christmas, according to Domnick, whose subsidiary Pacific Shipping Inc., is the agent for MELL.

A special ceremony was held Dec. 10 at Amata Kabua International Airport for the arrival of Our Airline's first regularly scheduled flight that kicked off what is expected to be long-term service linking Majuro to Brisbane and other points south.

Foreign Minister Phillip Muller hailed the service on behalf of the government, saying it will open new opportunities for commerce, and increase visits to the Marshalls from nearby neighbors Kiribati and Nauru. Our Airline is now offering the only north-south air link in this part of the Pacific.

The resumption of weekly air service - cut in 2008, when the airline lost money on an earlier attempt at service - is the result of the Aviation Task Force negotiating with Nauru and Marshall Islands officials to get the air service restarted. The Marshall Islands Nitijela in its fiscal 2013 budget included $500,000 as a "top up" fund to support the service. Muller said it is to be used only when flights do not carry passenger and cargo loads needed to meet minimum revenue requirements.

Geoff Bowmaker, Our Airline CEO said this fund is critical to the success of the service in the long-term. The first year is a developmental period in which the service can be expected not to make money while it promotes the new route. The Marshall Islands financial commitment to supporting the service is a key ingredient to long-term success that was missing from the earlier aborted effort at providing regular air service, he said.

Airline and Majuro airport officials both said that the first two Our Airline flights were filled to near capacity with passengers, getting the air service off to a positive start.

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