Pacific Notes

American Samoa Cyclone Olaf Strikes American Samoa Damage assessment was underway on the main island of Tutuila mid-February and a team was on the way to the Manu'a Island group, as Cyclone Olaf moved away, according to Governor Togiola Tulafono. The governor says government employees in Manu'a will be called in to help with recovery work and relief effort. "We pray that lives of people in Manu'a will be spared by the cyclone, as it did our lives on Tutuila," said Tulafono as Pacific Magazine went to press. "Manu'a received the brunt of this cyclone." A satellite image of Cyclone Olaf over American Samoa Photo: NoAA On Tutuila, a damage assessment team was dispatched to villages on Feb. 16, with government offices re-opened. Togiola said the territorial government will provide whatever assistance is available to those families affected by the cyclone until American Samoa hears from the federal government on its request to declare a major disaster area. According to government officials only two landslides had been reported to the Emergency Operations Center. There were also reports of few fallen electric lines but no damage to property, said officials. Tulafono urged residents to help each other in any way they could. "We all need each other's support, help and cooperation this time," he said. -Fili Sagapolutele

American Samoa
Government Faces Being Named "High-Risk Grantee"

The U.S. Congress's investigative arm, the General Accounting Office (GAO) says theft and fraud have weakened the accountability of most federal grants awarded to American Samoa. And citing the repeated failure to file single audit reports, the GAO has recommended the territorial government be declared a high-risk grantee on all federal grants.

It lays some blame at the doorstep of the Department of Interior (DOI) saying, "incidents of theft and fraud should have heightened federal agencies' requirements" of the local government to carry out required Single Audits under federal regulations.

The GAO in its review of 12 key grants to the territory said in a Jan. 18. report that recent "instances of theft and fraud by American Samoa Government officials call into question accountability for most of the grants we reviewed."

Tafua Fa'au Seumanutafa, Toetu Solaita and Patolo Mageo, all former government officials, are cited in the GAO report, as examples of the theft or fraud cases found in government. The three individuals have entered separate guilty pleas in U.S. Federal Court in Honolulu and will be sentenced this year.

According to GAO there are also reports from the U.S. Department of Agriculture involving "vendor fraud" under the Women Infant and Children (WIC) program, administered in the territory by the Department of Human and Social Services.

The GAO says a Comptroller hired by the government last March to work in the Treasury Department resigned in August, "citing concerns over fraudulent and unethical American Samoa government practices."

In response, the DOI has raised serious concerns about declaring American Samoa a high-risk grantee but has agreed to consult with other federal agencies to evaluate whether or under what conditions a joint declaration of high-risk status would be prudent. DOI's concerns include the possible loss of access to federal programs and the possible impact of such an action on the American Samoa population and eventually on other insular areas.

DOI argues that many of the measures available with a high risk declaration are already being taken in American Samoa.

The GAO report also includes a letter from Governor Togiola T.A. Tulafono, which states that a high risk status would imperil future funding to the territory. Tulafono agrees with the report's finding that the lack of staff, facilities and resources in the territory has limited service delivery. However, he says, "American Samoa is the poorest state or territory of the U.S.," and "over 56 percent of American Samoans live below the poverty level, as compared with 23 percent in Guam and 12 percent in the U.S."

-Fili Sagapolutele

Imperial Couple Plans Tour
Japan's Emperor And Empress May Visit Micronesia

A twice-delayed visit to Micronesian islands by the Emperor and Empress of Japan is apparently on again, and the imperial couple is expected to be on Saipan in late March. The visit is timed to commemorate the end of World War II and the huge loss of life in those islands, all of which were once administered by Japan.

Emperor Akihito and Empress Michiko Photo: Floyd K. Takeuchi

The Mainichi Daily News' Web site reported in mid-February that the Japanese government has designated the Saipan visit to be memorializing those who died in the war. This year marks the 60th anniversary of the end of the Pacific war.

A Japanese diplomat told Pacific Magazine that a mooted visit to Palau, Marshall Islands and Federated States of Micronesia has not been as yet decided, although he did say usually such visits are planned six months to one year in advance.

The battle for Saipan was one of the bloodiest of the Pacific campaign in World War II. Nearly all of the 30,000 Japanese defenders of Saipan died during the mid-1944 invasion. Another 22,000 civilians, many of whom were Japanese and Korean, also were killed. U.S. casualties were also high. Some 5,000 American servicemen died, and another 10,000 or so were wounded.

The Northern Marianas, along with what is now Palau, the FSM and Marshall Islands, were all administered by Japan under a League of Nations Mandate dating back to World War I. Japan was given control of the islands, which had been German colonies. Guam, which had been under Spanish control, has been under the U.S. flag since the late 19th Century.

Today, commercial and familial ties to Japan remain strong across most of the former mandate islands. Saipan's tourism industry relies heavily on Japanese visitors, as well as Japan-based investors. Many families can trace part of their lineage to Japan. For example, the first president of the Federated States of Micronesia's surname was Nakayama. A recent president of Palau's surname is Nakamura.

-Floyd K. Takeuchi

Palau
President's Inauguration Focuses On Taiwan

Palau President Tommy E. Remengesau, Jr's second inauguration late January was witnessed by many dignitaries, including President Chen Shui-bian of the Republic of China, who raised the possibility of closer ties between the two states.

Remengesau's inauguration address focused on the importance of a delicate balance, that of preserving "Palauness"-the traditions, the culture, the environment of Palau-while developing Palau's economy."

One of Palau's most important international relations is with Taiwan, which has funded projects including the capital buildings under construction in Melekeok, the newly opened Ngarachamayong Cultural Center, the Belau National Museum and the renovation of the runway at Palau International Airport. Taiwanese businessmen are also significant investors in businesses and hotels in Palau-most recently, in a five star hotel on Malakal expected to be completed in summer 2005.

President Chen's attendance was considered both an honor and a pleasure in Palau; it also caused a bit of a stir in view of special security modifications that had to be put into place. Palau law enforcement agencies were on round the clock alert for the president's visit.

Taiwan President Chen Shui-Bian and Palau President Tommy Remengesau Jr. during inauguration festivities in Koror. Photo Courtesy: Republic Of China Goverment Information Office

Chen emphasized his hope for peace across the Taiwan Straits but acknowledged the reality of the situation, "it is an undeniable fact that Taiwan is constantly under military threat from the Peoples' Republic of China." But he also pointed to signs of cooperation, including the, "very close exchange and cooperation in terms of trade and economy" that Taiwan and mainland China enjoy. Chen's displeasure that the Republic of China is not entitled to membership in the United Nations or the World Health Organization was clear, and he acknowledged Palau's strong and vocal support for that membership.

Chen discussed the possibility of future cooperation in other areas between Taiwan and Palau. He cited the ocean and democracy as commonalities the two countries share as well as the belief in freedom, human rights and peace. "I think these are the very reasons behind our diplomatic ties and friendship."

He said the Taiwanese people accounted for 47 percent of Palau's tourism-exceeding the numbers of tourists coming from anywhere else. He said this has encouraged many Taiwanese business people to invest in Palau.

"I'd like to emphasize," he said, "that it's not so important what Taiwan can offer in terms of hardware such as providing funds to build a museum or cultural center here in Palau. What is more important is the fact that Taiwan's experience and investment will help create more jobs in Palau and help people build their own lives without relying on external forces."

-Nancy Chism

Region Continental Micronesia To Maintain Service, But Cut Salaries Difficulties in the airline industry will not, in all likelihood, mean any reduction in service from Continental Micronesia Airline, according to the new president of Continental Airlines, Jeffrey Smisek. Though the airline lost US$100 million during 2004 and has announced that it will cut US$500 million in costs by April 28, no reduction in its service among the Pacific Islands is planned. Larry Kellner, Continental Airlines CEOAC Photo: Frank Whitman "We are very committed to Continental Micronesia," said Smisek during a Jan. 18 press conference in Houston. "Continental Micronesia makes money for us. I would not anticipate any kind of significant changes." Continental Airlines has already cut costs by US$1.1 billion. "We're at a point now where it's not likely that we would do any kind of reduction of service or anything in respect to any of the islands." However, employees of Continental Micronesia can expect their wages and/or benefits to be part of the current round of cost cutting. Though the specifics of the cuts were not determined as of press time, Continental CEO Larry Kellner said they would be spread throughout the company, with those making the most money taking the largest cuts beginning with himself and Smisek. "Because they (Continental Micronesia) are a relatively small piece of the total company, they'll also be a relatively small piece of the total cuts; but every piece is important," he said. "We try to win together. We work together. It's important that we have all those pieces there." Continental officials also said they will be installing electronic check-in kiosks at the Guam airport within the next few months. Continental passengers will be able to complete airport check-in at the machines at the airline's ticket counter, with agents on hand to provide assistance if needed. Continental's major effort in the Pacific-its applications to secure rights to routes out of China-will not impact the islands. The hoped-for routes are Newark - Beijing and Newark - Shanghai. The press conference was held at the George Bush Intercontinental Airport in Houston as the airline and the airport celebrated the grand opening of new arrival and passenger processing facilities. -Frank Whitman

CNMI
Governor Rejects 2005 Budget

Calling the fiscal year 2005 $217 million budget proposal "unacceptable," Governor Juan N. Babauta on Jan. 12 rejected and send back to the 14th Commonwealth Legislature House Bill 14-250 and asked them to reconsider his recommendations. Meantime, the Northern Marianas Government continues to operate under a "continuing resolution" process which means, it can only spend up to $213 million.

"The bill contains errors and accounting tricks, and makes promises to our government employees that cannot be kept," Babauta stated in his letter to the Presiding Officers of the Legislature. "It is unacceptable to a public that wants responsible management in government, and certainly should not become law."

Senate President Joaquin Adriano announced the Senate will not override the governor's veto, adding it is doubtful the Legislature can rework the budget for this fiscal year. But House Speaker Benigno R. Fitial said the House will attempt make the necessary amendments and send it back to the governor. Some lawmakers said they will wait for the submission of the fiscal year 2006 budget, due April 1st.

The budget proposal, which had been sitting at the Legislature since Apr. 1, 2004, passed the Legislature on Dec. 17. Babauta, in a strongly-worded nine-page letter, said the budget proposal is not a "sound fiscal plan" in that it fails to "supply realistic funding for the core services" such as education, health care, public safety and economic development. It also failed to provide the $7.8 million for the government's utility bills. At the same time, the governor pointed out, the bill "promises increases in compensation for government workers, but does so in a way that will never happen and amounts to simple deception."

During the past two years, Babauta claims he succeeded in keeping expenditures in line with the revenues and balanced the budget. "These achievements came in the midst of what were arguably the toughest economic conditions of the last two decades," he wrote to the Legislature. The governor, however, admitted that the Commonwealth now has a cumulative deficit of over $100 million.

The Governor labeled as "short-sighted" the decision to cut funding for the Marianas Visitors Authority. Tourism is the "main engine of our economy" and cutting its promotional budget by over one million dollars at the time when the agency is preparing to open three new offices in China to take advantage of its Approved Destination Status limits MVA's ability to do its job. The governor asked for the cooperation of the Legislature in working together to approve a budget that is acceptable to both sides.

-Frank Rosario

CNMI
Volcanic Ash Raises Alert

Volcanic ash from the northern island of Anatahan is affected residents of the Northern Marianas including the Territory of Guam throughout January. Volcanic eruptions in early January sent rocks and smoke up to 5,000 feet and aircraft traveling in the area flew as high as 35,000 feet to avoid the eruptions.

Two children and one adult were admitted for observation at the Saipan hospital as a result of volcanic ash which blanketed the island and could be seen for miles.

Anatahan is located about 80 miles north of Saipan in the Northern Marianas archipelago. It was inhabited by about 20 residents until the late 1980s when the once dormant volcano began emitting smoke, forcing their evacuation to Saipan. At one point in January, the volcano was erupting every 10 seconds.

-Frank Rosario