Guam’s Holy Grail: The race to diversify the economy

Aquaculture is one of the alternative industries being eyed by the government for export and to increase Guam's food security. (UOG photo)

The desire to diversify Guam’s economy has been the Holy Grail of each administration, including the current one.

But the ongoing COVID-19 pandemic and the resulting tourism downturn makes the need to diversify the island’s economy even more urgent today.

Former governor Carl T.C. Gutierrez is not only the interim president and CEO of the Guam Visitors Bureau, he is also the chairman of the Governor’s Economic Strategy Council and Chief Advisor to the Governor on Economic Development, National and International Affairs (EDNIA).

His urgent task now is not just to achieve the recovery of the island’s tourism industry but also to lessen Guam’s dependence on such a volatile industry by developing other industries that can be a source of alternative revenue for GovGuam.

According to Gutierrez, the administration has already prioritized adding information technology (IT), agribusiness, and aquaculture to Guam’s economy. He said the Guam Economic Development Authority (GEDA) and EDNIA have been actively pursuing initiatives along these lines since day one of the Leon Guerrero-Tenorio administration.

“GEDA, the University of Guam, the Guam Aquaculture Task Force, Dr. Lee Yudin, and Dr. Hui Gong Jiang have taken the lead to refortify Guam’s aquaculture industry with the revitalization of the Fadian Hatchery at the Aquaculture Development and Training Center. They’re cooperating with startups and fish farmers to feed local and regional demand for pathogen-free shrimp. GEDA is also actively engaging farmers to provide produce for schools and finding new avenues to make consumers less dependent on imports and more reliant on local raw and packaged foods. And for the last 16 months and counting, EDNIA has been gradually developing connections for regional food security,” Gutierrez said.

With regard to information technology, EDNIA’s primary focus is the digitization of cargo management at the seaport.

“Since Governor Leon Guerrero appointed me as her chief economic advisor, we have been cooperating closely with Port User Group Paperless Integration Task Force Chairman Charlie Hermosa, Port Authority General Manager Rory Respicio, Customs and Quarantine Agency officials, and contractors to identify whatever clogs throughputs, blocks wharfage, limits cargo intake, tangles up egress and delivery, causes tax revenue leakage, and allows illicit drugs to seep through our seaport. Together with stakeholders, we’ve been gradually introducing creative solutions that will save time and money so the port can be safe and ready for the mass tonnage that will coincide with peak construction during the military buildup,” Gutierrez said.

Ship repair hub

The former governor pointed out that increased vessel traffic also means a demand for more ship repair and maintenance services. Thus, EDNIA is working to convince the Navy to let Guam reprise its role as the premier ship repair hub in the region by bringing back Big Blue Dry Dock. This has already been fixed and refurbished and is awaiting approval for certification here in Guam.

“It’s high time the powers that be relent from their adamance against Guam’s resumption as the Western Pacific’s top watercraft maintenance depot. Governor Leon Guerrero and Lt. Governor Tenorio opened their hearts and our island to the sailors aboard the USS Roosevelt and gave them safe harbor and shelter from their plight when that whole aircraft carrier was a floating vessel of coronavirus infection and desperation earlier this spring,” Gutierrez said.

He added that this spirit of give-and-take friendship will help balance national defense priorities at Apra Harbor while optimizing Cabras Island and the Jose D. Leon Guerrero Commercial Port’s vaunted standing as a U.S. strategic seaport.

“Guam wants to be of optimal service to the Navy as Pacific force realignment and the military buildup unfold. Reopening the Ship Repair Facility on Guam to help keep the defense fleet and commercial carriers in operation would be a big win for everyone. Let’s rediscover the cooperative 122-year relationship between the U.S. Navy and Guam— an arrangement that made us one family after Spain surrendered Guam to America in 1898,” Gutierrez said.

Technology park and data centers

EDNIA also supports Gov. Lou Leon Guerrero’s vision to build a technology park and a modern municipal hospital with inbuilt telemedicine systems.

“We’ve been engaging private sector players in the development of expanded hubbing strategies for submerged fiber optics and regional data centers. This networking will support regional demand for the full spectrum of data applications from the Internet of Things (IoT) to telemedicine, from records storage and security to video streaming and gaming, and from low-latency web-surfing to international high-speed banking,” Gutierrez said.

He added: “As I’ve always said, Guam is ‘America in Asia.’ Our island is located within an Asian time zone, which is ideal for workaday commerce. From a financial technology vantage, that means identifying viable ways to make our island a safe legal hub for tax efficient entities, as well.”

Gutierrez also agrees with Guam Congressman Michael San Nicolas’ proposal to motivate U.S. corporations to repatriate the profits they earn from doing business overseas by offering a generous tax rebate. Under this program, GEDA would excise a relatively small percentage of the U.S. taxes owed on those foreign profits and then return the balance of tax revenue that would otherwise be due. An enabling amendment championed by EDNIA is now under active review and it is seeking to enact this initiative into the framework of GEDA’s U.S.-approved Qualifying Certificate Program.

Taiwan and the Philippines

More immediately, Gutierrez said Guam should begin pursuing and executing reciprocal documentation protocols with Guam’s established primary visitor source markets like Japan and Korea, on the one hand, and Taiwan and the Philippines on the other.

He said pandemic protocols with Taiwan are critical because GovGuam needs to keep its revitalized relationship with that country going.

“Our burgeoning sister-cityhood with Taichung is off to a great start. Our specialized healthcare pipeline to China Medical University Hospital is already transforming the lives of Guam patients. And I am honored to have befriended CMUH International Center CEO Aichi Chou, who consistently goes above and beyond expectation to warmly welcome Guam patients to Taichung and to ensure their satisfaction. Together with Lily Yu (Commissioner of Taiwan Overseas Community Affairs Council and Chair of the Taiwanese Business Association of Guam Foreign Affairs Committee) and Anna Kao (President of Taiwanese Business Association of Guam), Ms. Chou has also been instrumental in ensuring the procurement and delivery of more than 200,000 surgical masks for Guam front-liners and in pre-arranging a future state visit by the Taichung Mayoralty. We also deeply value the close friendships we have established with Taiwanese investors and developers. These tycoons have cast their votes for Guam’s potential with their dollars and cents through the myriad investments they’ve made on the island over the years, especially along Tumon Bay’s white-sand crescent,” Gutierrez said.

EDNIA’s mission to clinch visa waivers for Philippine citizens visiting Guam has been Gutierrez’s highest profile campaign to date, in his capacity as the governor’s Chief Advisor on Economic Development, National and International Affairs. EDNIA’s work in this area has formed a fitting tandem with Governor Leon Guerrero’s orders to negotiate the lifting of policies and sanctions that bar or inhibit Overseas Filipino Workers from employment on Guam.

Last year, Gutierrez received the governor’s permission to form a Visa Task Force in cooperation with the Duterte government in the Philippines and the Torres-Palacios Administration in the CNMI. And she backed it up with Executive Order 19-22, which assigns EDNIA to “research and develop a strategy to assist in the inclusion of the Philippines as an eligible country in the H-2A and H-2B Nonimmigrant Worker Program and as a member country of the Guam [Visa] Waiver Program.”

Gutierrez said both of these neighboring governments have cooperated in helping smooth the way toward the seamless integration of compliant, regulated U.S. visas for workers and visa waivers for visitors. “And before the international coronavirus shutdown, Guam Labor Director David Dell’Isola and I were laying the groundwork for favorable considerations from the U.S. government,” he said.

In close cooperation with Dell’Isola and Greg Massey at Guam Department of Labor and key players at Joint Region Marianas, EDNIA has so far managed to weave in several stopgap measures to help contractors secure and retain H2 workers for their ongoing projects.

“We have even secured visas for Filipino families who’d never been to Guam in their lives. We retained sponsorship funding from Guam corporate donors for live television coverage of the 2019 Dinagyang Festival in Iloilo, and warmly welcomed a large delegation from the Western Visayas last year. We did this because the people of Guam treasure centuries of friendship and family ties with the Philippines. But we have a lot of work to do before unimpeded employment visas and visa waivers for Filipinos are respectively granted by USCIS, Homeland Security, and the State Department following the COVID crisis. Yet our accomplishments in this endeavor will be worth it in the end,” Gutierrez said.

EDNIA is now winding up the most critical information-gathering and assessment phase of Guam’s pandemic response. Gutierrez said EDNIA began pandemic-response consultations with business leaders prior to the coronavirus lockdown—well before he knew that the governor would be assigning him as GVB’s interim president & CEO and chairman of the Economic Strategy Council.

“With these new designations in hand, I need to sustain the momentum of the programs we have begun with the Philippines and Taiwan and to protect long-established visitor markets in Japan and Korea,” Gutierrez said.

Take care of the people

But in the rush to develop new industries and make Guam safe for travel again, Gutierrez said it must not be forgotten that the top priority is making the island safe and hospitable for the people who actually live here. Two decades into the 21st century, Guteirrez pointed out that some folks still don’t have running water, power, or sewer service.

“We can meet their needs with Compact Impact funds, creative financing, and affordable typhoon-proof construction. Aside from lacking utilities, far too many of our people still don’t even have a place to live! This puts desperation on display and breeds crime. Not a good look for Guam!” the former governor stressed.

Gutierrez also pointed out that too much available land lies empty while the people struggle to find safe shelter. He said the Chamorro Land Trust Commission and innovative builders must be engaged to finally get Guam’s homeless veterans and civilians into comfortable, affordable homes.

“Visitors can already clearly see our homeless begging for food and money on street corners and ambling through the capital city of Hagatna. If we don’t do something now, it won’t be long before hordes of homeless people are walking the streets of Tumon and camping out in the open. Make no mistake—dozens of our homeless folks and families already live within the less-developed shadows of our tourism capital,” Gutierrez said.

He added: “No matter how many slick ads we produce, our visitors will see the real thing. We cannot find ourselves telling a better story than we can actually support. The most important aspect of CHamoru culture is how we take care of each other. We cannot ignore the least of our brethren.”