Recently in my bookcase I discovered a booklet entitled “Foreign Direct Investment in the CNMI” dated Aug. 14, 1998. It was written by Jonathan P. Kazmar, who produced the booklet while doing a graduate internship program at the Northern Marianas College. With curiosity I began to page through it and realized the wealth of information it contained and the immense research that was put into it. As I continued reading it, I noticed several important points which I wish to share with you. His research was made 15 years ago! Have we listened to his suggestions or are we still prodding ahead aimlessly?
One of the major recommendations made is that the Commonwealth must explore alternative industries that we desire in order to achieve stable economic development. In other words, we must decide the industries we are capable of developing and not rely on only tourism as we seem to be doing presently. The government and we, the people of the CNMI, must come to a consensus on what those industries should be. We will never enjoy economic development unless all of the players are involved.
Individual efforts by various government departments or the Legislature will not have much of an impact. Instead we need a coordinated effort from each government department, Legislature, administration, and the private sector-all offering combined incentives to the foreign investors. From this, we must develop a “package” that can be offered to the specific alternative industries that we wish to promote.
Mr. Kazmar states that there is no easy answer or “quick fixes.” Altering a few laws will not achieve successful foreign investments by themselves. Simply put, the CNMI must take charge of its own economic development/destiny. Instead of waiting for things to happen, we must make them happen. Therefore we must figure out what we want, put the package together, and go out there and get it.
To begin putting an investment package together, the government should create a specific department with the responsibility of providing foreign investors with up-to-the-minute information and data on the CNMI. Any investor should be able to find answers to his needs simply by applying to that department. This has been discussed many times before but never implemented. Remember I am quoting from Mr. Kazmar’s comments made 15 years ago!
I have had potential investors call me and other friends of mine seeking information. Many also wish to understand our unique tax laws. It is difficult to satisfy their questions because the information is difficult to find. A recent example occurred in which I was able to persuade the individual to visit Saipan and see for himself. Finally he came with his family. They were all pleased and as a result he, his family, and his business are in the process of transferring to Saipan. How many more would like to come here that we don’t know of?
The CNMI is daily being watched by foreign businesses, economists and investors to see what the CNMI will do in its present situation in relations to CW1, E2, E5, and the other entire possible visas’ pertaining to workers and investors. Frankly, we are in a state of confusion not knowing from day to day our next step. Do we wonder why investors have become shy about investing in the CNMI?
Another recommendation Mr. Kazmar makes is that once the Commonwealth determines the type of economic development it desires to pursue, it should create a small budget and then hire a reliable international marketing firm to market our objectives. At the same time, the governor should also set up a trade representative office or board. Its job would be to collectively review any applications, assign a member to investigate the creditability of the applicant. In other words, the CNMI should set up “helping hands” to explain tax incentives and permitting.
There are several investors who have been knocking on our doors for several years, yet we don’t really know their real intentions or capability. This we have to correct if we are going to be sincere and successful in attracting truly interested investors. They should not be left to random findings. Remember we have may other countries that are competing with us for them. Marketing is a serious business and we need professionals to help us. We cannot leave the attraction of investors to chance. We must become aggressive and professional.
Some of our closest competitors are Guam, Singapore, and Hong Kong. Shortly we will have Palau, the FSM, and the other Micronesian Islands if we don’t hurry. We must study the advantages we have to offer and market them heavily. We must also study what our nearest competitors have to offer. In other words, what can we do to make us more investor friendly? I truly believe that we have not truly studied this all important function-marketing for sincere investors.
In addition, we must call in the advice and assistance of the private sector such as the Chamber of Commerce. The government must work closely with the private sector which has many resources to offer. Mr. Kazmar explains that this is what Guam has done. Also I add that we should get the assistance of foreign investors already here who are happy such as our hotels and other businesses.
As we have noted in previous discussions, there are quite a few industries that the CNMI should pursue. One of them is commercial fishing/ port and fish transport facility. I recall years ago seeing many Japanese tuna boats transshipping huge quantities of tuna from Tinian harbor for shipment to Japan. I never learned why this activity died out.
Mr. Kazmar cites quite a few industries that the CNMI citizens or investors could pursue. His main point is that merely giving tax incentives and altering a few laws will not cause of stampede of investors. We must know what we want as industries, package the advantages of those industries, and then market them. Simply put Mr. Kazmar states, “Changing a few tax laws will not make a difference unless efforts are made to market the favorable climate that those changes foster.” There are many opportunities but we must decide what we want here.
If anyone is interested in Mr. Kazmar’s booklet I am sure it is available at the Northern Marianas College, Business Development Center. His booklet offers solid advice on the many opportunities we have to offer to investors. Repeating myself, I firmly believe that the CNMI is a wonderful place for investors, but we have failed to market ourselves successfully.
I plea with our government to look into how we have been marketing ourselves to potential investors. Being close to huge populations such as China, Korea, Japan, and Russia, we can become a Mecca to them. What is holding us back? Remember Mr. Kazmar’s research was done in 1998-15 years ago? Are we going to be where we are today in another 15 years?
The CNMI has huge potentials, but for some strange reason we are failing to cultivate them. There are acres of diamonds waiting to be dug up. LET’S DO IT! LET’S GET OFF OUR BUT’S (excuses)! DO IT!
As a sign along the highway reads: “Asking for Help is a Sign of Strength.” We need help. Let’s package the investors’ needs and they will fulfill our needs.
Have a great week and remember to SMILE! It will be returned with a big SMILE and a feeling of joy.
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The need to build a local and foreign investment climate
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