Governor paints positive picture for Hawaii’s economy
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Hawaii Gov. Linda Lingle painted an upbeat picture of the state's economy, which she said was still on a path to growth.
Bleak reports about the nation's flagging economy do not apply to Hawaii, Lingle said.
Recent events such as the closure of Molokai Ranch and shutdown of Aloha Airlines and ATA Airlines were unfortunate, but don't reflect the fundamentals of Hawaii's economy, she said.
No recession is predicted for the state, she said.
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Gov. Linda Lingle painted a positive outlook for the state during her keynote luncheon speech before the Hawaii Economic Association yesterday.
Blaming the media for highlighting negative stories about the nation's economic woes, she contended that Hawaii's economy is not so bleak.
"People locally continue to hear these reports and commentaries about how bad the economy is and how it keeps getting worse," said Lingle early in her speech. "But the fact is that many of these stories simply don't apply to Hawaii."
» Hawaii's economy has slowed, but not stopped. "Many important indicators show moderate growth, that, when contrasted with the rest of the nation, is a fortunate position for Hawaii."
» Lingle cited a projected 3.9 percent state revenue growth for this fiscal year and a forecast 2.5 percent growth in gross domestic product this calendar year.
» She emphasized the need to transform the economy from dependence on land development and tourism, and to focus more on an innovation economy.
» Lingle urged Hawaii to take the lead on the path toward energy independence through renewable power.
While the closing of Molokai Ranch, followed by the shutdown of Aloha Airlines and ATA Airlines were unfortunate, she said they are not a reflection of weak fundamentals in Hawaii's economy.
"Our state's economic growth has slowed, but it has not stopped," said Lingle. "Many important indicators show moderate growth, that, when contrasted with the rest of the nation, is a fortunate position for Hawaii."
Among the statistics she cited were a projection by the Council on Revenues of 3.9 percent growth for this fiscal year, along with a forecast by the state Department of Business, Economic Development and Tourism of a 2.5 percent increase in gross domestic product this calendar year and next.
"The latest forecast from the University of Hawaii Economic Research Organization predicts that our state will not slip into a recession," she said.
In addition, Hawaii's unemployment rate is tied for fourth-lowest in the nation in March, she said, besides having experienced positive job growth during each of the first three months of 2008.
Lingle said Hawaii has largely escaped the single most damaging factor to the nation's economy -- the subprime mortgage crisis. Hawaii continues to rank No. 45 in the nation in foreclosure rates.
Bond raters, such as Standard & Poor's and Moody's, continue to give Hawaii a high rating, due to its fiscal conservatism, positive tax revenue and employment growth.
Lingle invited the business community to step up to the plate.
"I am a firm believer that during an economic slowdown, businesses should not hunker down, be stagnant and adopt a defensive mentality," she said. "This only exacerbates the situation. Rather, these are times when true business leaders adapt, look for efficiencies, cut non-essential costs, exercise outstanding entrepreneurial skills and capitalize on opportunities that arise."
The state's proposed purchase of Turtle Bay Resort is one such opportunity, she said.
She said the state would move forward on its $2.3 billion investment into upgrading the state's airports over the next 12 years, as well as modernizing its harbors.
Other long-term economic drivers for growth include the arrival of Walt Disney Co. at the Ko Olina Resort, along with the Department of Hawaiian Home Lands' planned mall in Kapolei, ongoing military contracts, and emerging visitor markets in Taiwan and China.
The state, however, must end its over-reliance on land development and tourism, she said, and focus more on an innovation economy.
"If we overdevelop, we destroy our spectacular natural resources and the unique quality of life that are Hawaii's most valuable assets that define this place and define us as people," said Lingle.
Educational programs encouraging students to pursue science, technology, engineering and math are vital to this innovation economy.
Every high school should have a robotics team, she said.
Also, the governor emphasized that Hawaii must take a path toward energy independence through renewable power.
Hawaii is currently the most oil-dependent state in the country, and energy costs are stifling the state's economic growth, she said.
"My administration is aggressively pursuing energy independence today," said Lingle, citing a recent initiative to replace 70 percent of the state's power with clean energy sources by 2030 in partnership with the U.S. Department of Energy.
Instead of spending $5 billion importing oil to Hawaii each year, that money could be invested in renewable energy enterprises at home, she said.
"We have an incredible opportunity for energy transformation, with abundant, diverse renewable resources that rival any place on Earth," said Lingle. "From solar and photovoltaic, to wind, to geothermal, to wave, to ocean thermal energy conversion, to biofuel -- the possibilities are vast."