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The Honolulu Advertiser
Posted on: Sunday, April 27, 2008

COMMENTARY
Keeping Hawaii's economic engine on track

By Marsha Wienert, State Tourism liaison

Hawaii news photo - The Honolulu Advertiser

Marsha Wienert, State Tourism liaison.

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THIS WEEK

Editorial and Opinion Editor Jeanne Mariani-Belding puts Jeff Mikulina, director of the Sierra Club's Hawai'i chapter, on The Hot Seat for a live blog chat Wednesday from noon to 1 p.m. at www.Honoluluadvertiser.com/opinion

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Each week Editorial and Opinion Editor Jeanne Mariani-Belding hosts The Hot Seat, our opinion-page blog that brings in elected leaders and people in the news and lets you ask the questions during a live online chat.

On The Hot Seat last week was state tourism liaison Marsha Wienert.

Here is an excerpt from that Hot Seat session. To see the full conversation, go to The Hot Seat blog at www.honoluluadvertiser.com/opinion and click on "The Hot Seat." (Names of questioners are screen names given during our online chat.)

Rob: What's the forecast for our tourism landscape concerning the drop in visitors?

Marsha Wienert: Our original forecast for visitor arrivals this year was for a 1.4 percent decrease in visitors; however with the recent challenges we are revisiting those numbers and will be able to address your question in depth at a later time. With the loss of seats and a softening economy on the Mainland we expect April through June to be very soft months. We are still optimistic regarding summer business.

Debbie: What's your take on the airport improvements? Do we need to spend more than a billion at this time when the economy is in such dire condition?

Wienert: As you know we have embarked on a $2.3 billion airport modernization program. The program is a 12-year modernization plan. It is modular and the improvements are based on demand. We believe that the projects included in the plan continue to be needed improvements and the costs are justifiable. No general funds will be used for the improvements. All projects will be funded through airport special funds that come from the users of the airports.

Micah: Isn't it time to think about other economic bases other than tourism? Why is it taking decades to diversify our economy? Is it because too many well-connected people want to see dollars continue to be pumped into tourism for their own financial reasons?

Wienert: Great strides are being made by the administration to diversify our economy into other areas, including technology and renewable energy. However, tourism continues to be and will be for some time an important part of our economy. Hawai'i has a comparative advantage in tourism: We have the infrastructure, natural resources, climate, activities and attractions desired by visitors. Visitors spent $12.2 billion in the islands last year and the industry accounted for about 30 percent of Hawai'i's jobs.

B. Prescott: Have those dependent on tourism thought of how they could help the airlines survive during this rough period since their own survival is at stake?

Wienert: The airline industry is currently experiencing many challenges especially because of high fuel costs. There have been many discussions in regards to what we can do to encourage air-seats into our state. Currently airlines are telling us that the best thing we can do is increase demand for the destination. Demand generates supply and increased demand could assist us in adding and maintaining seats into Hawai'i. Additionally, the Hawai'i Tourism Authority provides marketing co-op funds to airlines and travel partners to help market their flights to the islands.

Tina: Has anyone looked into the idea of offering really good deals to the local people to get them pumping money into our economy? We are so dependent on tourist dollars that sometimes we overlook what's right in our own front yard.

Wienert: From an economic development point of view, local spending for hotels and other visitor activities simply replaces spending that would occur shopping, going to the movies, buying new furniture, etc. It is important for the overall state economy to bring in dollars from outside the state.

With that said, local business is important to many visitor industry businesses as it provides sales stability.

Kama'aina rates are determined by private business and accommodation rates fluctuate based on demand. Because of our soft Mainland and Japan business in May and June, I would imagine that there will be a lot of very good kama'aina rates in the next few weeks.

Kyle: Please explain what your job involves (and) what is the budget you have to get that job done.

Wienert: My position is a new one created by Gov. Linda Lingle when she was elected for her first term. She felt that tourism was important to our state's economy and that a Cabinet-level position needed to be created in order to coordinate between state agencies and the visitor industry on all tourism related issues. My budget is $6,000.

George: How big is your staff and what is your salary?

Wienert: I have no staff, however, I have administrative support from the Department of Business, Economic Development and Tourism. My salary is similar to other Cabinet members.

John: I know this may sound way out in left field, but since tourism is our golden egg, why can't we give tourists an incentive to come to Hawai'i by reducing sales tax for tourists? The number of tourists we attract through this "Malihini Discount" will make up for the minor loss in tax revenue.

Wienert: Interesting suggestion; however, the Department of Business, Economic Development and Tourism estimates that visitors contribute 28 percent of our general excise tax. General excise tax revenue last year was approximately $2.5 billion. A reduction of this magnitude to our state revenue would result in some drastic reduction in government spending.

Lisa: With the loss of Aloha Airlines, do you think that alternative transportation, such as the Superferry is necessary, and if so, why?

Wienert: Even without the loss of Aloha Airlines, transportation alternatives are in the best interest of our residents. The Superferry provides that alternative.

William: We think of tourists coming from the Mainland or Japan, but what is being done to attract tourists from Europe and the Middle East regions? The way the dollar has fallen on the world market I am sure Europeans would be happy to spend their money in Hawai'i.

Wienert: You are absolutely correct. With the euro at an all-time high, Europeans are traveling a lot. We have a marketing contractor in Europe that is implementing marketing programs primarily in the U.K., Germany, Italy, Ireland. To date, through March, visitor arrivals from Europe are up 11 percent.

We also have many marketing programs in Asia, especially in Korea and China, that are being implemented by Hawaii Tourism Asia. 25 Hawai'i businesses are currently in Korea meeting with travel sellers and media promoting Hawai'i as a travel destination.

You didn't mention Canada, but we are very pleased with the exchange rate in this marketplace, and visitors from Canada are up 44 percent.

Jo: What can be done to make Hawai'i more appealing to tourists?

Wienert: A lot has been done, especially on O'ahu, to upgrade our visitor infrastructure. Billions have been reinvested in the product over the last few years by the private sector.

We have a wonderful destination and the satisfaction levels of our visitors are high. The most important thing that we can do is to continue sharing the "aloha spirit" with visitors.