Many of the most important issues or developments in local industry last year will continue to unfold this year. So The Advertiser, in no particular order, recalled 10 of 2003's most important local business stories, all of which had a major influence on the business community or consumers.

• City Bank takeover.

When Central Pacific Financial Corp. announced in April that it wanted to buy City Bank parent and rival CB Bancshares Inc. from CB shareholders after CB management refused the offer, Central Pacific knew it was in for a fight.

The hostile takeover attempt got personal, with terse statements on what it means to be a local bank, then became mired in legal challenges to moves each bank made to advance their positions. At times the bank battle has resembled a political contest, though shareholders, regulators and judges may decide the matter involving the state's fourth and fifth largest financial institutions.

• Hawaiian Airlines bankruptcy.

The state's largest airline began the year ending its popular coupon program for interisland travel and seeking major labor concessions to help survive in a severely depressed industry. In March, it filed for Chapter 11 after concluding it would be unable to pay future bills.

What was characterized as a relatively straightforward restructuring of aircraft leases turned into a rancorous reorganization as the airline's chief executive was removed and replaced with a court-appointed trustee. The trustee sued to recover money that the airline spent to buy back company stock, and he has rankled pilots by withholding pension fund deposits.

• Iraq war and SARS effects on tourism.

State economists expected visitor arrivals to rise about 6 percent in 2003, but unexpected external influences, largely a reluctance by Japanese visitors to fly to Hawai'i due to the Iraq war and SARS, left the industry with a 1 percent drop in arrivals for the year through November.

The war and illness derailed the industry's rebound in March, and led to airline service cutbacks and worse-than-expected business for hotels, tour operators, retailers, attractions and other tourism-related businesses.

• Gas prices.

The cost of gasoline in Hawai'i started the year with a 5-cent increase in January and the trend hasn't let up — with prices rising about 25 cents during the year to a 10-year high of around $2.10 a gallon and receding little since then. Meanwhile, the debate continued over the gas price cap law set to take effect in July, while state attorneys declined to pursue allegations that ChevronTexaco avoided taxes.

• Employment.

Through 2003, Hawai'i consistently beat the nationwide average unemployment rate while adding jobs overall and posting gains in personal income.

• Home sales.

Low mortgage rates fueled a boom in buying new and existing homes in Hawai'i. Although prices reached new highs during the year, the appreciation was generally driven by supply and demand, not a repeat of the speculative buying that created a bubble market in the late 1980s.

While building homes, developers have not been able to keep up with demand. Such demand is fueling growth in a construction industry leading state economic growth.

• Ko Olina tax credits.

After failing to obtain $25 million in tax credits to finance an aquarium in 2002 because of a veto by then-Gov. Ben Cayetano, the master developer of Ko Olina Resort & Marina won approval from Gov. Linda Lingle last year.

The credits helped attract commitments from developers of hotels, homes and time-share projects at the West O'ahu resort, and will create a new attraction for the tourism industry. Ko Olina also contributed $2.5 million for educational scholarships primarily for Leeward O'ahu residents in return for the state support.

• Duty-free retail contract.

High-stakes negotiations lasted most of last year as the state and travel retailer DFS-Hawai'i tried to restructure an exclusive contract to sell duty-free merchandise to departing foreign travelers.

Adjusting DFS rent because of new security measures at the airport and a decline in visitor arrivals stood to affect the largest revenue source for state airports.

After the state sued DFS to recover $49 million in unpaid rent, the two sides reached a settlement and DFS successfully bid for a new contract, though DFS still faces challenges.

• Military housing construction.

The major branches of the armed forces awarded contracts last year worth about $3.5 billion to remodel or rebuild military housing on O'ahu. The work will employ numerous local contractors and suppliers, keeping them busy through 2014, with housing management contracts running longer.

• Visitors bureau shake-up.

The Hawai'i Visitors & Convention Bureau took severe hits last year, receiving a scathing state audit that prompted the resignation of the nonprofit organization's chief executive. The bureau also lost major accounts for marketing the state to overseas travelers and was forced to downsize.