The U.S. Department of Interior’s ongoing efforts to foster private sector-led economic development in the insular areas will continue.
Business opportunity conferences in 2003 and 2004 and three subsequent opportunity missions including visits to Guam Saipan and Palau have exposed hundreds of companies to investment possibilities in the islands. As a result several projects are already underway.
Now the department is looking to build on past successes with its third Conference on Business Opportunities in the Islands scheduled for Nov. 13 and Nov. 14 in Honolulu. Companies from around the globe will attend information sessions on business opportunities in the seven insular areas but department officials said that the important work is done in the face-to-face meetings that are the heart of the conference.
“Our main focus in these conferences is connecting business to business ” David Cohen deputy assistant secretary for insular affairs at the Department of the Interior told the Journal. “Outside companies with expertise and capital can partner with local partners that know the opportunities and how to get things done in the islands. Together they can achieve success that they couldn’t achieve separately.”
Sedy Demesa executive vice president of Pleasant Care Corp. one of the largest privately-owned chains of skilled nursing facilities in California said the personal contacts provided by the 2004 conference were critical to her current business investments in Saipan. Encouraged by the conversations she had at the conference and as a participant in the Business Opportunities Mission to Saipan in 2005 Demesa purchased a 35-room hotel on the island which she plans to convert into a school for nursing.
“Most of the nurses in California and Nevada where we also have a convalescent hospital come from the Asian-Pacific countries ” Demesa said. “So I thought why not bring the school nearer to them?”
Demesa said that the cooperative efforts of the Department of the Interior and the Northern Mariana Islands government were key in motivating her to pursue business interests in Saipan. She also points to the size of the NMI as one of the unique — and beneficial factors — of doing business in the islands.
“There is a more personal touch in your dealings with governmental agencies and you meet with government officials faster than when you are in a bigger country ” she said.
While health care will continue to be a strong interest area for outside business Cohen said that the energy and military construction sectors may well be the hot topics for the 2006 conference.
“Alternative energy is very important in the islands this year ” he said. “They have been hit as hard as anyone with the skyrocketing price of oil. I expect companies with the technology to help them reduce their dependence on oil will see some opportunities.”
The conference will address the planned movement of Marine Corps troops from Okinawa to Guam with a presentation by Adm. William Fallon commander of the U.S. Pacific command on the Guam Integrated Military Development Plan. That plan said Cohen “makes military construction an even hotter topic than it has been in the past.”
Despite the opportunities highlighted by the conference challenges to doing business in the islands still remain. Recent reports by the International Monetary Fund the Asian Development Bank and the Department of the Interior point to obstacles such as inequitable tax structures land tenure rights and inadequate physical infrastructure. Overcoming these issues Cohen said has to be a focus of the insular area governments.
“The most important thing is to have the political will to adopt reforms that may give rise to opposition in the short run but are necessary for the people to prosper in the long run ” he said.
Cohen pointed to land ownership issues as an example. “The land issue is a challenge throughout the islands. Governments must create legal and regulatory infrastructures where banks can have the confidence to make loans with property as collateral ” he said.
With each conference and mission the Department of Interior fine-tunes its efforts to facilitate private sector development in the islands. For example the Office of Insular Affairs conducts extensive research through its Island Fellows Program to identify industries and companies that fit the unique opportunities in the islands. This research generates targeted invitations to the conferences and missions.
Angela Williams economic advisor with Insular Affairs said the emerging success stories such as Demesa’s are part of the growing evidence that the department’s approach is working. She tracks the businesses that have participated in past conferences and missions and said that many are currently pursuing opportunities in the islands.
Williams also points to the “very wide” audience that the conferences are reaching as a sign that her office is on the right track. “I think the most significant thing is the number of ‘repeat customers’ that we’ve attracted to these conferences and missions — it bespeaks a very high and consistent level of interest ” she said. “That and the projects that people are working on is our accomplishment.” MBJ