Japanese Market Hoped To Revitalize Tourism In CNMI

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Reopening of hotel rooms across NMI could bring $256 million

By Moneth Deposa

SAIPAN, CNMI (Saipan Tribune, March 29, 2013) – A marketing expert described 2013 as an exciting year for the rebirth of Commonwealth of the Northern Mariana Islands tourism, which is projected to start generating record numbers in arrivals despite a hotel-rooms crisis.

Serving as keynote speaker in yesterday's regular membership meeting of the Marianas Visitors Authority (MVA), Michael Merner, chairman of the AVIAREPS Marketing Garden, said that the Commonwealth will remain dependent on Japanese travelers.

He said the Japan market remains the islands' top market destination. Japan, along with Korea, accounted for 70 percent of the total market arrivals in the Commonwealth.

"We see a strong recovery in the Japan market. So our forecast, this year we will see record numbers and the highest level since [Japan Airlines] pulled out in 2005," he said.

Merner also sees a "new exciting opportunity" for the CNMI with the possible entry of new LLCs, or low cost carriers, to the CNMI, hopefully this year.

MVA, he said, is in constant contact with new LLCs about the possibility of launching flights to the CNMI. He said Star Flyer and Air Asia are among the leading contenders.

A low-cost carrier is generally an airline with fewer frills and lower fares.

He believes that LLCs, once introduced in the CNMI, will dramatically change the tourism structure of the islands.

Merner said the Japanese economy is picking up due to increases in industrial production, corporate profits, business investment, and the employment situation. Japan's economic growth rate is projected at 1.5 percent in fiscal year 2013. Major Japanese companies gave salary increases in January-up to .07 percent-the first increase in nine months.

Last fiscal year, 18.5 million Japanese traveled overseas. Merner said this is up 8.8 percent from 2011 due to the strong yen, rebound in demand, new routes from Haneda Airport, and the entry of LLCs in the market.

Merner said the CNMI will directly benefit from this growth by tapping Japanese travelers all year round. Merner said that Japan airlift to the CNMI is seen to increase by 4 percent, estimated at 198,651 this fiscal year. This figure is higher than fiscal year 2012's airlift of 192,161.

However, to realize this big growth in the industry, Merner said the CNMI has to come up with a solid solution to address the lack of hotel rooms, especially on peak seasons.

Airlift is key to boosting arrivals but this should be complemented with enough number of hotel rooms, he added.

Also seen as a challenge is the lack of new developments and new openings on island that will attract more tourists.

The CNMI is also projected to benefit from a similar economic progress in South Korea and China. LLCs are also projected to be launched from Korea and top contenders are Jeju Air and Jin Air. Charters and new flights are also being worked out with both destinations.

Merner pointed out, however, that the CNMI must work hard on the China market since the destination remains relatively unknown there.

600 hotel rooms closed

MVA board chair Marian Aldan-Pierce disclosed yesterday that an estimated 600 hotel rooms are closed on Saipan, Tinian, and Rota at this time, negatively affecting MVA's efforts to bring more tourists to the islands.

If these rooms are opened, this will translate to 116,568 additional annual tourist arrivals to the CNMI, she said. In economic impact, this means an additional $256 million for the CNMI and 2,598 additional jobs for both the public and private sectors.

Aldan-Pierce said the CNMI projects arrivals in fiscal year 2013 to reach 652,979, which translates to $1.5 billion in projected economic impact and 6,873 jobs in the public sector and 7,682 jobs in the private sector.

She attributes the good numbers for the tourism industry this year to many factors including the "renewed" interest of people.

Finally, she said, people got the message that tourism is everyone's business and is 24/7. She also lauded the partnerships shown by the community and private and public sectors through cleanups and beautification projects.

Inos vows to address hotel room crisis

Gov. Eloy S. Inos vowed yesterday to help address the lack of hotel rooms.

He blamed the shortage on the closure of many hotels such as Palms Resort Saipan, Coral Ocean Point, Hotel Riviera, and Plumeria.

"We need to put them back online," he told Saipan Tribune.

Inos, among the guests in yesterday's meeting, described the presentation as "very interesting" and that arrivals figures are important in making the government's revenue projections.

The governor revealed that based on his proposed budget for fiscal year 2014, their arrival projection is at 500,000-slightly lower than the 600,000 projected in yesterday's presentation.

However, Inos said that arrivals may change in the coming months.

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