Dear Editor:

The Pohnpei State Government is currently considering Bill No. 332-18 to Establish the Micronesian Tourism Omnibus Development Statute, which aims to build a hotel and casino in Pohnpei. We have stated our recommendations during the hearing at the legislature on Monday, November 5th, and written our concerns about this plan on Tuesday, November 6th to the Pohnpei State Legislature for the following reasons:

  1. As stated in the bill, the development of a hotel with a casino, if done right, has potential to bring financial benefits and jobs to Pohnpei State. However, the current bill as written, does not show how many temporary (i.e. construction) and permanent (i.e. employees of the hotel and casino) jobs will be created from this project for Pohnpei’s residents. We feel the bill should be amended to require a minimum number of local employees to be hired by this establishment and to require a minimum number of local senior-level employees (i.e. managers, assistant managers, supervisors, etc.) who will make more than minimum wage, so we truly feel true benefits to our people? The bill also does not provide us with any sort of an estimate of what the potential financial benefits are going to be in terms of fees and taxes to Pohnpei State. We feel it is incumbent on Pohnpei State to make their case to Pohnpei’s residents by providing a comprehensive assessment which will show the minimum amounts of jobs and financial benefits Pohnpei State is willing to cope with in order for this venture to make a major difference in our economy. Simply passing a law without setting some concrete parameters and educated and/or minimum estimates on the benefits we wish to gain from such major decision is irresponsible. There must be a cost benefit analysis (financial/economic benefits versus environmental, health, social and cultural risks and implications) so we know what we are gaining against what we are losing to help us decide if this is the course we wish to take.
  1. And as we stated during the hearing, the bill also does not include any provisions on money-laundering, fraud, prostitution and human trafficking. We feel the bill should be amended to include these provisions or if these are already in existing laws, the bill at least should allude to such laws. Gambling has the potential to bring fraudulent people and businesses to Pohnpei. And at the moment, Pohnpei State does not have the capacity to deal with such.
  1. The hotel and casino will require large provisions of our water resources and power from the Pohnpei Utilities Corporation (PUC). The Legislature needs to require the Governor and the Department of R&D to provide an assessment of how much water and power such establishment will require and how this will impact the availability of water and power resources to the residents of Pohnpei? And for the Governor and the Department of R&D to provide a comprehensive plan on how they will provide water and power to this company without compromising water and power resources to Pohnpei’s residents and other business establishments before this bill is taken under consideration.
  1. In other parts of the world where tourism has grown rapidly, including in Palau and in Bali Indonesia, the large number of visitors and their appetite for fish and other marine resources has caused declines in their fisheries and driven up the price of those resources to the point where most local residents can no longer afford them. For example, in Palau, the cost of mangrove crab is now at approximately $35/lb. And while this, in the short term, is a good thing for the local fishermen, many locals can no longer afford them. And when people can no longer afford their own natural resources, it leads them to eat more unhealthy imported proteins or foods. It is very important that this issue be taken into consideration, so we don’t lose our ability to eat our most healthy proteins like fish. If we lose our ability to eat our healthy local proteins this can exacerbate our non-communicable disease epidemic. As we are all aware, this epidemic is already costing Pohnpei a lot of money in medical expenses.
  1. Establishment of a hotel with a casino has potential to bring other large businesses. As I shared during my testimony this morning, the casino will bring a lot of people with lots of money who could potentially invest in Pohnpei. While this may be a good thing for our economy, it will also have environmental, health, social and cultural implications. And it will most certainly change our current strategy to develop sustainably. For this reason, we ask that there be a referendum on what direction the people of Pohnpei want. Do we want sustainable development as is stated in our current Pohnpei State Strategic Development Plan and the FSM National Sustainable Development Plan, or do we want to build Pohnpei into another Saipan and other places with big businesses, regardless of how it impacts our environment, health, culture and social welfare? Please note that we are not asking for a referendum on the hotel and casino, we are asking for a referendum on the future strategic direction of Pohnpei State and the FSM. FSM has signed off on several commitments with the United Nations, calling for sustainable development – establishing a large-scale hotel and casinos are in direct contrast to these commitments.
  1. The claim that Pohnpei needs a 200-room hotel and casinos so we can host large national, regional and international conferences may be a false assumption. Those traveling to Pohnpei for conferences and other eco-tourism activities may not necessarily want to check into a hotel with a casino. These may very well be two different sorts of clientele and may not necessarily want to associate with each other. There must be a tourism/visitor survey to see if people visiting Pohnpei for conferences, and to dive, surf and participate in eco or traditional tourism activities will actually want to check into a hotel with gamblers. Or if they are willing to visit an island with casinos and gambling – these are things we want to find out first. Also, a hotel with a casino may not want other guests who are not interested in gambling and spending money in their establishment stay with them. These are questions that must be answered before this bill can be considered.
  1. As I also stated in my testimony, climate change is an issue FSM and Pohnpei State are quite vocal about in the international community. If we are serious about climate change, we need to refrain from dredging reefs and destroying our natural protections (coral reefs and mangroves). Establishing a casino on a reef flat can be perceived by our regional partners and the international community that we are not do not believe in and are not serious about climate change and rising sea-levels. As we are all aware, rising sea levels, and the expected increased droughts and other climate change impacts such as typhoons will also impact the viability of the investment and physical infrastructure in the long term.
  1. People who are attracted to gambling are usually high rollers who are not sensitive to traditional cultures and customs. Are these the types of tourists we want to attract to our island?

We feel this bill is premature. There are just too many unknowns for this bill to go through right now.




William Kostka, on behalf of the conservation community

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