Wednesday, February 13, 2013

President Mori obtains views on ETG investment in Yap and urges progressive information sharing with communities

FSMIS (February 13, 2013): On February 1, after a series of consultative meetings with Yap State leaderships, traditional leaders, the private sector and NGO’s regarding the Chinese ETG investment proposal, President Manny Mori shared with Governor Sebastian Anefal and the Yap State Legislature a document on what transpired at those meetings with recommendations.
ETG stands for Exhibit and Travel Group, a Chinese business with overseas investments and operations.
President Mori indicated to both Governor Anefal and the Yap State Legislature that moving forward with the scaled-back ETG investment would be in the best interest of Yap State and the Federated States of Micronesia (FSM). However, he stressed that the decision to allow ETG to proceed rests with Yap State.
The President decided to take on the consultative meetings in mid-January in hope that conclusive leadership decisions can be achieved soon enough. He said in his meeting report, “because of the current impasse and the lack of a clear understanding of the role that the national government has in terms of foreign direct investments, I though it is incumbent on me, as President, to address the issues directly with the concerned parties and see how I can bring their divergent views together towards a more accommodating and acceptable alternative”.
In the same report, President Mori stated that the initial ETG investment interest in Yap was to include the construction of 10,000 room hotel facilities, golf courses, casinos, a convention center and other “entertainment support facilities”.
“I must say that I also have concern about the initial scale of the project”, the President highlighted before saying that the investment plan has been dramatically reduced so that no golf course and casino will be included and that only 1,500 hotel rooms will be constructed. He went on to say that further demands for scaling back and restrictions on the investment may not be financially viable for ETG, risking cancellation of interest altogether by the Chinese investors.
In terms of economic benefits, the President envisioned increase in tax revenue from various ETG-related infrastructure constructions and creation of new services and jobs. It is anticipated that tax revenues to Yap State resulting from the ETG investments will be even greater if the proposed Value Added Tax scheme is implemented.
President Mori spoke of the lack of information and the unanswered worries by the general public as complicating situations. He encouraged the leadership and ETG to engage the people as far as providing details and transparent information to cast away misunderstanding and create openness. He also spoke against providing wrong information as doing so will only provoke ill feeling toward investment and development in general.
Other issues that were commented on by the President in his meeting report touched upon some impacts and their possible remedies in areas having to do with land issues, environmental protection and cultural way of life.
“This ETG tourism investment proposal may be one of the answers to our desire to bring about meaningful development to our islands. We may not see another opportunity like this ETG proposal in our lifetime especially if there are no legitimate reasons to reject the investment proposal at the scaled-back level”, President Mori wrote at the end of his meeting report.
The President’s ETG meetings report could be read entirely on the link below:

1 comment:

  1. 1) ETG stands for Exhibition & Travel Group, a Chinese "Mega-Resort" developer (not an investment company, they use predominantly OPM (Other People's Money, in the Yap case, the PRC owned China Import-Export Bank)).

    2) The "Dramatically reduced investment proposal" (its new "scaleback level) is so far (Feb 14 2013) completely unknown to all except a select few (maybe only Manny?). In the last publicized communication on the matter (ETG letter to Governor Anefal), the so called "scaleback" was simply breaking the original proposal into "phases" -- same number of facilities as originally proposed -- and also adding "development of the Outer Islands, where appropriate"...

    3) Opinion: This is very far from "Meaningful" development. For one thing, if the travel market goes sour for whatever reason, Yap will be left with a collection of "White Elephants" (abandoned, ugly, unmaintainable "resort facilities")

    Henry K.O. Norman
    Independent Researcher