Luring business to paradise

November 11, 1997|By Andrew J. Glass

HONOLULU -- There was a time when Japanese moguls would cruise through affluent districts here, real-estate agents in tow. When one saw a home he liked, the agent was told to buy it. Price wasn't a concern.

Those times are gone. The Japanese economy has tanked and Hawaii has been dragged down in the undertow.

In the past six years, Hawaii ranked dead last among the 50 states in its pace of growth. Last year, personal incomes here rose by a paltry 1.7 percent, the poorest record of any state.

The Honolulu Advertiser has run a five-part series, titled ''Lost in Paradise,'' that sought to explain what has gone wrong.

Vacation delight

The newspaper found that the tourism industry has been so successful in touting Hawaii as a vacation delight -- nearly seven million tourists last year -- that U.S. mainland firms fail to see it as a sensible place to open shop.

Hawaii will always remain the most isolated land mass on Earth. But as the nature of world commerce changes, some leaders here hope that the great distances will recede as an impediment to growth.

Chinese President Jiang Zemin stopped over for the weekend at the start of his recent eight-day tour of the United States. Having plopped down in the bowl of the Pacific Rim, Mr. Jiang used the visit to urge ''rational investors'' not to pull the plug on troubled Asian markets.

A cold bath

Even as he spoke, the fiscal lords of Hong Kong, now restored to Chinese rule, were forcing the speculators who had made a run against the local currency to take a cold Pacific bath. Over a few days, vast sums were won and lost in roiling markets as monetary authorities put up their entire $88 billion stake in foreign exchange reserves to defend the Hong Kong dollar.

Ben Cayetano, Hawaii's Democratic governor and Mr. Jiang's initial host, would like to see his state get in on the action by becoming a fiscal center for the region -- one that offers traders rock-solid stability coupled with relative proximity to Asia.

To clear a path, Mr. Cayetano has hacked away at a dense governmental work force. An Economic Revitalization Task Force, has crafted a far-reaching plan to cut taxes and offer incentives for fresh investment.

More than 175 years have passed since U.S. whaling boats first appeared in Kealakekua Bay, soon to be followed by American missionaries and sugar planters.

Perhaps, in the century to come, a new crop of Chinese millionaires will also land on these shores to revive the great real estate boom of the 1980s.

Andrew J. Glass is Washington bureau chief for Cox Newspapers.

Pub Date: 11/11/97

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