Open For Business

High-level officials and politicians led the island delegations to Los Angeles. Marshall Islands President Kessai Note stressed the positive impact of the recent renewal of the Compact with the U.S. for another 20 years and the country's political stability as good reasons to do business there.

Federated States of Micronesia Vice President Redley Killon explained how a recent economic summit had endorsed a strategy "to embark on a high growth scenario for 20 years" saying "success depends on (our) ability to attract foreign investment" and that agriculture and fisheries were top priorities.

Palau's Ambassador to the U.S. Hersey Kyota pointed to the opportunities presented by the country's recent Free Trade Zone Act, and the fact that the private sector is now responsible for many undertakings formerly handled by the government.

Governor Togiola Tulafono touted American Samoa's "unique situation with our own minimum wage structure" and "probably the best utilities in all of the Pacific," while Guam and the Commonwealth of Northern Mariana Islands stressed their proximity to Asia.

"You can feel the hum, the vibration that's happening," said Governor Juan Babauta.

It was left to Guam's Lieutenant Governor Kaleo Moylan to speak for the region more broadly when he urged delegates to "think of doing business with all of us," while saying "your business is in safe hands in Guam." He could afford to be inclusive, given Guam's status as a transport, tourism and economic hub for the region.

There were a few common themes.

Tourism and the proximity of many islands to the huge markets of Asia came up time and again. "There is also a great deal of untapped tourism potential in the Federated States of Micronesia and the Marshall Islands," Secretary of the Interior Gale Norton said. "Each (territory) has the advantage of being both part of America, and part of the region in which it is located. All of the territories have a skilled, educated workforce that is fluent in English…and that is very well trained by the standards of its region."

The military buildup, particularly on Guam and to a lesser extent, CNMI, caused some excitement. Rear Admiral Arthur Johnson told a packed session "there is a new buzz, there is a new center of activity emerging…the new century will be the Pacific century.

"The strategic location can't be beat. You are literally three or four hours from over a billion consumers …(and) the political stability is another plus."

Rear Admiral Johnson's colleagues expanded on the theme, particularly on upcoming construction opportunities on Guam, saying the total value of projected military contracting contracts is $370 million. Upcoming projects include rebuilding of the military hospital, and construction of schools and living quarters. The military says it looks for safety, quality and timeliness in its contractors.

"After some of the force structure decisions are made, things could really take off…the timing is now, if you wait until the train has already left the station, it could be much harder to break into the market," said Commanding Officer, Public Works Center, Captain David Boone. "We're on the threshold of what we think is going to be very big…it feels big."

Stories from businesspeople with a history of success in the region were also instructive.

The President of Pacific International Jerry Kramer warned that island governments had seen "more than their fair share" of "overnight successes." Gary Sword from Express Electronics said islanders have different views on business, "different but not wrong." Miller/Watts Construction CEO Denny Watts stressed the importance of local succession and of trying to leave "something there that's better" and Katrina Adams from Kosrae Village Ecolodge said "deep cultural differences" make it essential to work with local partners.

So a lot of talking, but what will be the tangible results of the meeting? Secretary Gale Norton says the (U.S.) administration's two top priorities for the islands are to help them realize their economic potential and ensure the wise use of federal funds. She said the large turnout-double last year's number-meant "we are thrilled both by having all of the companies here, but also by what that indicates about the interest in investment in our islands and about the possibilities,"

Norton says that last year's conference "helped jump-start the privatization efforts of the Guam Telecom Authority."

There was a telling moment that stressed the importance of political leverage to economic development when it was announced that legislation had been introduced in the U.S. Congress to provide for representation for the CNMI in the House of Representatives. Flanked by other island members of congress, CNMI Governor Juan Babauta declared, "I'm very emotional tonight," and said that the citizens of CNMI looked forward to the day when their voices could be heard.

Deputy Assistant Secretary at the U.S Department of the Interior David Cohen is preparing to lead a trade mission to the islands to follow up on contacts made at the conference. Island governments and businesses no doubt look forward to seeing the voices heard at the Los Angeles event translate into some tangible investments.