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December 29, 2020

Hawaii Residents’ sentiment toward tourism has worsened

Cindy Ellen Russell / crussell@staradvertiser.com
The shores of Waikiki seem to be getting busier, as seen Dec. 13.

Allison Schaefers, Honolulu Star Advertiser, 12/21/20

Even after enduring a collapse of the state’s economy this year, most Hawaii residents aren’t eager for a return to the 2019 tourism numbers.

The downturn in Hawaii tourism has led to thousands of lost jobs, temporary and permanent business closures, and strained social support programs.

Still, a new survey from OmniTrak showed that resident sentiment toward Hawaii tourism has fallen to its lowest level since 1988.

Only 54% of Hawaii residents who took the OmniTrak survey agreed that “tourism has brought more benefits than problems.” Some 34% supported the statement that tourism has been “mostly positive for you or your family.” As many as 67% of respondents agreed with the statement that the “island is being run for tourists at the expense of local people.”

The results were based on a statewide sampling of 1,709 respondents weighted by island size which was conducted Sept. 16 to Oct. 25.

Normally, the number of Hawaii residents who support tourism increases after a crisis. Resident sentiment toward tourism soared to 80%, a 32-year high, in 2010 right after the Great Recession. It also improved after Sept. 11, 2001.

This time around, Hawaii residents see tourism as contributing to the increased health risks of the COVID-19 pandemic. They don’t trust tourism reopening plans, and they don’t think quarantine enforcement has been effective. Also, they still haven’t forgotten the over-tourism concerns that accompanied Hawaii’s rise to a record 10.4 million visitors in 2019.

Chris Kam, OmniTrak president and chief operating officer, said the data shows “residents are largely hesitant to reopen Hawaii to outside tourism and promoting/encouraging travel to the state at this time.”

On Saturday the state had 19,881 travelers, including interisland and trans-Pacific. That marked the most travelers since Safe Travels Hawaii, the state’s pre-arrival entry program, began Oct. 15. Some 15,874 of the travelers described themselves as visitors, and some 11,156 of them said they were coming for vacation.

Lt. Gov. Josh Green said the visitor count, which is inching toward Hawaii’s pre-COVID 25,000-a-day average, is a massive economic improvement from when Hawaii tourism was down 99.6% earlier this year.

“Travel has not had an impact on our case counts of any consequence; the numbers have been small,” Green said. “The state of Hawaii has the lowest COVID rate in the country by a big margin, and we opened up our economy.”

Moreover, he said current COVID-19 counts are largely due to community and inmate spread. Research from Drs. Mark Mugiishi and DeWolfe Miller suggests that returning residents are five times more likely to transmit COVID than a visitor, Green added.

Opinions expressed in the OmniTrak survey are a key reason that the Hawaii Tourism Authority continues to prioritize all four pillars of its strategic tourism plan: natural resources, Hawaiian culture, community and brand marketing.

HTA President and CEO John De Fries told HTA board members Thursday that “the eagerness by which we need and want to relaunch the industry often causes us to snap back and put our complete focus on the need for branding and marketing.”

“To a certain point, I’ve encountered some who wish to deprioritize or marginalize the other three pillars of natural resources, community and Hawaiian culture. What I want to reconfirm and restate is that the approach that is put forward by the strategic plan is an integrated approach — all of it is related to branding,” De Fries said.

For several years now HTA has been trying to pivot from its prior emphasis on achieving growth through arrivals or spending gains to more sustainable tourism goals.

Still, resident sentiment about tourism has kept falling for the usual reasons: traffic, strain on natural resources and infrastructure, the dilution of culture and higher living costs. Added to that is the perception, in the midst of the pandemic, that tourism negatively affects health. Some 43% of those surveyed felt tourism created health concerns and the potential for epidemics, as opposed to 25% last year.

Respondents who lived in visitor industry households were more confident that county governments could safely reopen tourism and were doing an effective job with quarantine enforcement.

Still, 43% of all respondents said they agreed with the statement, “People from outside the state of Hawaii should not be visiting Hawaii at this time.”

Paul Brewbaker, principal of TZ Economics, said he’s dumbfounded that some Hawaii residents, especially those living in visitor industry households, don’t understand how vital tourism is to Hawaii’s economic well-being.

“Those that think Hawaii is better off without tourism are clearly not looking at the economic realities around them,” Brewbaker said. “They could not possibly understand the economic catastrophe that has befallen Hawaii in 2020, which makes it clear that Hawaii is not better off with less tourism. It’s the exact opposite: 100,000 people out of work is a self-evident indication of how bad it is not to have tourism.”

Hawaii tourism bottomed out this spring amid COVID-19 fears and lockdowns. By October, HTA data showed that visitor arrivals still were more than 90% below October 2019. In the first 10 months of 2020, HTA reported that visitor arrivals to Hawaii dropped 73.4% to nearly 2.3 million visitors.

Hawaii’s visitor industry- dependent economy has been recovering since the state rolled out Safe Travels Hawaii. However, the results haven’t been as robust as some had hoped, inviting community debate on whether the gains have been worth it.

By year’s end only 2.7 million visitors are projected to have come to Hawaii.

Randy Rarick, former director of the Triple Crown of Surfing, said, “Local residents are questioning the whole deal.”

“We can’t lose sight of the need for better tourism management. Even before the pandemic, most locals were prepared to forgo some tourism profits for a better lifestyle,” Rarick said. “Instead of 10.4 million tourists, maybe we’d be better off with 5 million to 7 million. While we are kick-starting the economy, we need to remain focused on restarting the economy in the right way.”

Rarick said even the low numbers of visitors coming to Hawaii during the pandemic have brought challenges.

Rarick said the reopening of Hanauma Bay Nature Preserve already has created traffic jams and complications for surrounding neighborhoods. Rarick also points to the Pipeline Masters, where despite strict protocols a handful of executives recently tested positive for COVID-19, shutting down the event for several days.

“Personal safety has to be more important than making a buck,” he said.

'Highest unemployment ever': Guam economic outlook bleak, some bright spots

Tumon businesses at Pleasure Island on Dec. 4, 2020. Frank San Nicolas/PDN

Anne Wen, Guam Pacific Daily News, 12/5/20

Guam's unemployment rate is the highest it's ever been and the tourism industry is stagnant, but construction projects are a bright spot for Guam's economy.

Experts at the Guam Chamber 2021 Economic Forecast webinar Friday predicted construction spending will increase for military projects and COVID-19 federal spending will continue.

For Guam tourism, partial recovery is likely, but the pace and timing depends on the recovery from the pandemic. 

Due to the pandemic, Guam's unemployment rate increased from 6.1% in April 2019 to 17.3% in February 2020, according to the Guam Department of Labor. The agency recorded reported 6,000 jobs lost in the economy, not accounting hours reduced, according to Gary Hiles, chief economist of the Guam Department of Labor.

"This year is the highest unemployment ever recorded since the Bureau of Labor Statistics began collecting unemployment statistics in the '70s," Hiles said. 

Tourism hit hard 

"In the last few months, this island has lost about $200,000 per hour in tourism-generated sales," said Gerry Perez, the vice president of the Guam Visitors Bureau. 

The Tourism Attraction Fund dropped by 67.5% during the pandemic, he said.

The tourism economy infuses $2.5 billion annually into the economy and pays $260 million in local taxes. More than 21,000 jobs rely on tourism. 

Governments in China, Japan and Korea, from which Guam relies on for the bulk of its tourism revenue, have limited overseas travel.

"In a lot of these markets, the consumers are concerned about getting quarantine wherever they go," Perez said. 

Before the pandemic, year over year tourism growth was projected to increase by 8.3%. During the pandemic, arrivals declined by 85.05%. 

The recent opening of the Taipei Economic and Cultural Office offers promise to the tourism sector, said Peter "Sonny" Ada, the chairman of GVB board. GVB is in discussions to have the governor lead a delegation trip to Taiwan next year.

Next week, the agency will discuss plans with a new airlines to start flights from Taiwan to Guam. 

Construction, buildup

The coronavirus pandemic has had little impact on the construction industry, with the exception of temporary lockdowns after COVID-19 outbreaks, because projects continued. 

"Ahead, we anticipate more than ample opportunities for the construction industry across all sectors of the industry," said James Martinez, the president of Guam Contractors Association. 

Construction for the government sector and military installations promises contracts between small contractors and larger companies. 

"Our backlog is not necessarily a bad thing. It gives contractors a better tool for planning in the future months and years ahead, Martinez said,

Planned government projects account for $340.75 million. Military buildup construction is in full swing, with $853 million in projects under construction and $470.6 million in projects forecast for next year.

Another $662.8 million is allocated for the 2021 provision from the National Defense Authorization Act, which allows skilled H-2B workers on projects. 

"The challenges for these smaller contractors are going to be labor, a situation that we're experiencing where contractors are trying to petition for additional skilled workers to work on their projects," Martinez said. 

The defense spending bill will extend a "temporary need" exemption to civilian and military construction projects and allow the sourcing of workers from overseas. 

"With the current H-2B labor situation, smaller contractors are gun-shy to petition for an H-2B workforce," Martinez said. "These are contractors that usually specialize in residential construction." 

In the coming years, Martinez expects higher demand for carpenters, structural steel workers and masons. 

CNMI governor: Tourism opening to Korean market in January 2021

Haidee Eugenio Gilbert, the Guam Daily Post, 12/11/20

Commonwealth of the Northern Mariana Islands Gov. Ralph Torres on Thursday said the CNMI will partially reopen its tourism to the South Korean market "sometime in January of next year," with certain restrictions.

The CNMI's main tourism markets are South Korea, Japan and China.

"I just want to lay it out that we're not doing this for economic reasons but we're doing it because we're starting this new norm of tourism," the CNMI governor told members and guests of the Rotary Club of Guam during a Zoom meeting's question-and-answer portion.

Torres was referring to a so-called local tourism "bubble," in which any Korean tourist will not have contact with the general community during the first five days of their arrival, except for hotel employees at a safe distance.

Should they choose to play golf in the first five days, however, they will be transported directly from the hotel to the golf course and there won't be contact with the general community.

By the time they get to the golf course, all the equipment will be ready and services will be provided without contact.

The governor said they remain cautious, to ensure any tourism reopening "puts the health and safety of our people first."

Current protocols

The protocols will be pretty much the same as the current ones for anyone entering the CNMI, but will be tweaked for tourists, Torres said.

Currently, there's automatic COVID-19 testing at the Saipan airport, and passengers and their luggage are transported from the airport to a hotel, Torres said.

If their COVID-19 test result is negative, they will be quarantined for five days at a hotel.

On the fifth day, they will be tested again and once that's still negative, they will be released from quarantine.

If the initial test result from the airport is positive, the passenger is quarantined for 14 days.

When the CNMI reopens tourism to the Korean market in January, the tourists will be secluded from the general community in the first five days.

"This would be a new normal for our industry, one that will change the way we operate with new requirements aimed at keeping our residents safe as we bring back jobs and a level of normalcy that has been disrupted in these trying months," Torres said.

At this time, the governor is not naming the airline or airlines that will be flying in the first Korean tourists to travel to the CNMI since the islands closed their doors to tourists because of the COVID-19 pandemic. 

Torres said there is no assurance that South Korea will have lifted the 14-day quarantine for returning residents by that time.

Partially reopening the CNMI tourism market, he said, is made possible by strong partnership among government agencies such as those in public health and tourism.

Torres said the CNMI is also looking forward to reopening tourism to other markets such as Japan.

COVID-19 vaccine

Just like Guam, the CNMI is awaiting the arrival of COVID-19 vaccines.Torres said the CNMI has already secured 10 cold storage units to hold the vaccines.

"We try to be as prepared as we can when those vaccines are available here," he said.

Torres said the CNMI government has started collaborative work with partners on public education campaigns to encourage people to take the COVID-19 vaccines.

During the Q&A, the governor said he himself will take the vaccine.

"As much as I feel we're safe here, I would take the vaccine because if it's 90% to 95% safe, then that's 95% safer than if I don't ... take the vaccine," Torres said.

But he said he prefers that doctors, nurses, other medical personnel and emergency first responders receive them first.

"Not because I want to see the effect, not because I want to see any symptoms on them, but I believe they should be the first people to be protected and get this vaccine shot," he said.

The Federal Emergency Management Agency projected that the CNMI, which has a population of about 57,000, would have 6,000 to 8,000 COVID-19 cases by June if there were no restrictions in place.

Immediate response

The CNMI's immediate and proactive approach since January, long before local cases were reported, has kept the overall numbers low, with 111 confirmed COVID-19 cases and two deaths since March 28.

"Here in the CNMI, our mindset was this: One case in the CNMI is one case too many," Torres said.

As early as January, the CNMI was already screening incoming passengers at the airport.

Two days after it reported its first two COVID-19 cases, the CNMI governor imposed a 7 p.m. curfew for the general community.

Community testing followed, and by May and June, the CNMI was able to slowly reopen its economy.

Guam, with a population of about 160,000, has at least 7,039 reported COVID-19 cases and 113 deaths since March, and remains under Pandemic Condition of Readiness 1.

The island has not set a specific date for welcoming back tourists, only saying it's gearing up for a reopening in the first quarter of calendar year 2021.

Why The Navy Is Becoming A Powerful Force For Clean Energy

Hawaiian Electric’s 20-megawatt West Loch solar project on U.S. Navy land near Pearl Harbor went into service in 2019 and is one of the state’s largest.

Kevin Knodell, Civil Beat, 12/1/20

As the Navy looks to the future of its operations in the Pacific, it’s increasingly exploring renewable energy and other new technologies to get the job done. That gives it something in common with Hawaii.

For years the military has opened up space on island bases to local utility companies to develop energy generation projects, including solar and wind farms, that provide power to both civilian customers and the bases themselves. 

In October, Naval Facilities Engineering Command Hawaii began soliciting renewable and fossil fuel-based proposals from developers to plan, finance, construct, own, operate and maintain an energy generation system and storage system on about 160 acres of land at Joint Base Pearl Harbor-Hickam.

The military has long clashed with activists and state officials over the environmental impact of decades of live-fire trainingconstruction projects, threats to marine wildlife and other issues. But all agree on the need to reduce dependence on fossil fuels.

“It’s a very tangible example of where the state’s goals and the military’s goals overlap,” said Amanda Ellis, a former New Zealand diplomat and the Hawaii and Asia-Pacific Director for Arizona State University’s Julie Ann Wrigley Global Institute of Sustainability.

In 2015, Hawaii, which has the most expensive energy bills in the country, became the first state to pledge to work toward powering the state with 100% renewable energy by 2045. It has been the most petroleum-dependent state, depending heavily on oil and coal brought in by sea to power its electrical grid. 

For the Navy, which conducts near-constant operations across countless islands and waterways, power sources that can be replenished naturally offer game-changing possibilities for military operations. 

The COVID-19 pandemic has highlighted the vulnerability of global supply chains, says Erith Evans, the energy program manager at Naval Facilities Engineering Systems Command Pacific. The spread of the virus has caused massive disruptions to maritime shipping and is likely to have long-lasting impacts on the delivery of goods.

“(With) the next generation of renewables, we don’t have to bring in so much fuel to the island, and we know that that fuel supply chain is, I’ll call it fragile,” Evans said in a recent telephone interview. 

“That allows us to stay viable and allows us to perform our mission, even if possibly our supply chains are cut, because we’re able to generate power from a renewable source,” Evans added.

In May 2019, the Navy and Kauai Island Utility Cooperative launched a partnership to expand renewable energy at the Pacific Missile Range Facility. Their plan calls for the development of a 19.3 megawatt solar facility in conjunction with a 70 megawatt-hour battery energy storage system to reduce the installation’s reliance on diesel generators.

In November 2019, Hawaiian Electric Co. dedicated an 80,760 panel solar project built on 102 acres of the Navy’s West Loch Annex at Pearl Harbor. That project was projected to save Hawaiian Electric customers as much as $109 million over its expected 25-year lifespan and reduce the utility’s use of imported oil by as much as 3 million gallons annually.

In exchange for the land to host solar panels, the electric company agreed to provide infrastructure upgrades to the Navy’s facilities.

“Projects like West Loch Solar are a win-win for the community and the Navy, helping to advance the state’s renewable energy goals,” Hawaiian Electric spokeswoman  Shannon Tangonan said in an e-mail.

While Navy officials said that most of the power generation on military land is done by utilities without taxpayer expense, the Navy is also paying for several solar power and energy efficiency projects of its own.

“These partnerships, whether they are with our island’s utilities or with our industry partners, they definitely strengthen our ability to provide reliable and resilient and more efficient energy through our installations,” Evans said.

In September NAVFAC Hawaii awarded Ameresco Inc. a $14 million contract to install a solar power and a solar thermal system along with several energy efficiency upgrades at its Wahiawa Annex. The contract calls for panels to be installed on a canopy over a portion of an existing base parking lot and is expected to be completed by October 2022.

For full story, please click here.

Honolulu’s 2020 Sustainability Report

On December 23, Honolulu Mayor Kirk Caldwell released the city’s 2020 Sustainability Report.

The yearly report provides transparency on sustainability indicators for City operations, including on-site renewable energy generation, fuel use, number of trees planted, waste diversion, transportation affordability, and other metrics. The 2020 report includes an update on the City's progress towards implementing the Oʻahu Resilience Strategy.

The City has made improvements in key areas, but also reported worrying trends in others. Highlights included Honolulu's jump from a "C" grade to a "B" over the past year in national rankings by the Carbon Disclosure Project, the most trusted national metric measuring peer cities on their environmental and climate policies and performance.

However, the 2020 Annual Sustainability Report also shows that Oahu's overall greenhouse gas emissions—the prime driver of the climate crisis—increased 1.8 percent in 2018 island-wide compared to 2017, mainly due to emission increases in the transportation sector.

 

"I'm proud of the hard-earned gains we've made as an island community adding renewable energy and bringing our first electric bus into our fleet," said Mayor Caldwell. "However, the 2020 Annual Sustainability Report shows that we need to do more—we can't afford to get complacent as a community on COVID or on climate change. There's just too much at stake."

American Samoa GDP drops 1.4% in 2019

Talanei News, December 14, 2020

American Samoa’s estimates of Gross Domestic Product for 2019, released Friday by the Bureau of Economic Analysis show that real GDP, GDP adjusted to remove price changes, dropped 1.4 percent.

The decline in real GDP reflected decreases in government spending, exports, and private fixed investment that were partly offset by an increase in consumer spending and inventory investment. Imports, which are a subtraction in the calculation of GDP, decreased.

Government spending decreased 8.8 percent, dropping from $305 million in 2018 to $278 last year.

This reflected a decline in territorial government spending following the completion in 2018 of a multi million dollar telecommunications construction project.

The federal government spending was measured at $30 million while ASG spending was $258 million.

Exports decreased 4.7 percent, from $476 million in 2018 to $453 million in 2019, primarily reflecting a decrease in exports of canned tuna and related products.

Private fixed investment which was $48 million in 2018 decreased 22.7 percent to $37 million.

This decrease reflected declines in construction activity and purchases of equipment following the completion in the prior year of reconstruction activities associated with Tropical Cyclone Gita.

The bright news in the estimates was in consumer spending which increased 3.0 percent, jumping from $465 million in 2018 to $478 million last year.

This reflected growth in services that was largely driven by purchases of health care services.

Health care services included those directly financed by government social benefits such as Medicaid.

The federal government’s Additional Supplemental Appropriations for Disaster Relief Act of 2019 (P.L. 116-20) provided American Samoa with additional federal Medicaid funding.

Inventory investment increased, reflecting growth in supplies held by the canning industry.

The estimates of GDP by industry for American Samoa show that the private sector was the source of economic growth in 2018.

The growth in the private sector reflected an increase in manufacturing output of the cannery industry.

Output of non-manufacturing industries, such as construction and related professional services, also increased, reflecting post-cyclone recovery activities.

COVID-19 Update for the U.S. Pacific Islands and the Freely Associated States of Micronesia (as of 11/29/20)

About PBDC

The Pacific Basin Development Council, established in 1980 by the governors of Guam, American Samoa, the Commonwealth of the Northern Mariana Islands (CNMI), and Hawaii, is a regional non-profit organization that advances economic and social development in the Pacific Islands. The organization, which is based in Hawaii, is located at the East-West Center.

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