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DOC says closure of remaining cannery will bring catastrophic economic disaster

American Samoa Dept. of Commerce logo

Pago Pago, AMERICAN SAMOA — Commerce Department has given a “harsh reality” check of American Samoa’s economic future. And that reality “is quite clear”, said DOC, pointing out that, “Should our last remaining tuna cannery close, the territory will likely experience a catastrophic economic disaster and fall into a deep recession from which we may never recover.”

DOC provided the grim prediction in the draft Comprehensive Economic Development Strategy of American Samoa (CEDS-AS) 2018-2022 - a continuation of the CEDS 2013-2017 — which provides the territory with a plan to strategically manage its resources and prioritize development in key industries.

“These efforts are aimed at creating an environment in which economic diversification and resilience can flourish,” said the 66-page draft CEDS-AS titled, “American Samoa — Forging a Path Towards a Resilient Economic Future”.

According to DOC, which issues the CEDS for the territory, the CEDS program is one of the cornerstone programs of the U.S. Economic Development Administration (USEDA) and regions are required to update their CEDS every five years to qualify for assistance under the USEDA Public Works and Economic Adjustment Assistance Programs.

DOC said it's important to note that the renewal of the CEDS-AS is “occurring at a critically important time in our territory’s history”, adding that at “play presently are several strong and imposing forces that may impact the decisions we are making today.”

Examples cited by the draft report include “unsustainable pressures on the local tuna canning industry; our competitive advantage continues to erode as our minimum wage continues to increase as required by federal law; our population is decreasing; rural communities across the U.S. continue to see a relentless economic decline; and an uncertainty surrounding the long-term impacts of the ongoing trade negotiations between the U.S. and its trade partners.”

The report gave the grim prediction that if StarKist Samoa closes, this holds great implications for our people and the continuity of our culture and way of life. “It is with this in mind that the CEDS-AS will aim to focus our resources on economic diversification with long-term resilience as the ultimate goal.”

Asked about the importance of the CEDS for the future of the territory, DOC director Keniseli Lafaela told Samoa News that to quality for USEDA funding, “we are required to update our CEDS document which includes important development projects we hope to get funded.”

The draft report was initially released Apr. 1st for public comments with a deadline of Apr. 30th, “at which time we shall consider public comments and make changes to the document accordingly and if appropriate,” he said.

Lafaele points out that all 50 states and territories compete for USEDA funds, “hence we are currently looking at alternative sources of funding — other federal agencies, private US and foreign investors - to finance the territory's development projects.

As required by the USEDA, there are five main elements that make up the CEDS-AS 2018-2022. Among the elements is “Summary Background” which provides an overview of the territory’s economic situation, touching on both recent economic history and an economic forecast.

DOC released last month its American Samoa Economic Forecast including projection in the gross domestic product (GDP), which is similar details in the draft CEDS-AS for economic forecast. (See Samoa News Apr. 3rd edition and also DOC website for details.)

A new piece of information dealing with the economic forecast, is a “Business Confidence Index, “which states in part that, 75% of those surveyed responded that they were confident in reinvesting into the growth or expansion of their own business. In addition, 30.6% of those surveyed describe the current state of the economy as improving and 52.7% see the economy improving over the next 5 years. (The survey was conducted by the CEDS-AS working with local stakeholders.)

The second main element is the “SWOT Analysis” which assesses the state of the territory’s economy by determining the “strengths, weaknesses, opportunities and threats” (SWOT) posed by internal and external forces. The analysis also provides survey results of each SWOT.

The third element is “Strategies & Actions” which includes the vision, goals, objectives, strategies, and actions that the territory will take to guide economic development activities through 2022. The draft noted three goals and outlined their own specific objectives.

Fourth element is “Evaluation Framework” and this section establishes criteria and performance measures that will be used to evaluate the effectiveness of CEDS-AS implementation.

Fifth element, “Resilience”, outlines the territory’s approach towards building economic resilience such that our economy can better recover, withstand, or avoid major disruptions to our economy.

Details of the draft CEDS-AS can be downloaded here.

DOC is encouraging the public to read and comment during the comment period.