Home > News Release: Gross Domestic Product for the Commonwealth of the Northern Mariana Islands
EMBARGOED UNTIL RELEASE AT 7:00 P.M. EDT, SUNDAY, JUNE 6, 2010
BEA 10-24
Aya Hamano:
(202) 606-9683   (BEA)
Wali Osman:
(202) 208-4292   (OIA)
THE BUREAU OF ECONOMIC ANALYSIS (BEA) RELEASES ESTIMATES OF THE MAJOR COMPONENTS OF GROSS DOMESTIC PRODUCT FOR THE COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

CAPITAL HILL, SAIPAN (June 7, 2010) – Today, the Bureau of Economic Analysis (BEA) is releasing its first set of estimates of the major components of gross domestic product (GDP) for the Commonwealth of the Northern Mariana Islands (CNMI).1

Objectively gauging changes in economic activity is difficult in the absence of comprehensive economic metrics, such as the GDP. Until now, a framework did not exist to estimate the GDP of the CNMI. The Statistical Improvement Program, funded by the Office of Insular Affairs (OIA) of the U.S. Department of the Interior, has made it possible for BEA to develop formal methodologies for measuring the GDP of the CNMI.

On May 5, 2010, BEA released estimates of total GDP for American Samoa, the CNMI, Guam, and the U.S. Virgin Islands. The estimates for the CNMI showed that from 2002 to 2007, real GDP -- GDP adjusted to remove price changes -- decreased at an average annual rate of 4.2 percent.2 (For comparison, the average annual growth rate for the United States (excluding the territories) was 2.8 percent over this period.)

The estimates released today supplement the estimates of total GDP for the CNMI that were released in May. The accompanying tables present estimates for the major components of GDP, including consumer spending, private fixed investment, net exports, and government spending.3 Also included in this release are estimates of the major components of gross domestic income.

The estimates of the major components of GDP highlight the impact that the garment manufacturing and tourism industries had on the CNMI’s economic growth over the period 2002 to 2007. The notable decreases in real GDP from 2005 to 2007 were largely driven by decreases in garment exports and in tourist expenditures in the CNMI by nonresidents. Consumer spending and territorial government spending also contributed to variations in real GDP growth over the period 2002 to 2007.

In constructing the estimates for the CNMI, BEA used methodologies consistent with the methods used to estimate U.S. GDP. Information from the Economic Census of Island Areas was used to establish levels of GDP for the years 2002 and 2007. Annual series were then developed and used to estimate GDP for the intervening years. Because the CNMI is not included in most of the major surveys used by BEA to estimate U.S. GDP, the support of government leaders in the CNMI and the assistance provided by the CNMI Department of Commerce, the CNMI Department of Finance, and the Commonwealth Ports Authority were critical to the successful production of the estimates presented in this release.

Moving forward, the agreement between OIA and BEA will extend and improve the estimates of GDP for the CNMI. BEA currently plans to release estimates for both 2008 and 2009 in the spring of 2011.

1 These estimates are based on limited source data and are subject to revision.

2 Summary GDP statistics for the CNMI are presented on page 3 of this news release.

3 “Consumer spending” refers to “personal consumption expenditures,” “inventory investment” refers to “change in private inventories,” and “government spending” refers to “government consumption expenditures and gross investment.”

BEA’s national, international, regional, and industry statistics; the Survey of Current Business; and BEA news releases are available without charge on BEA’s Web site at www.bea.gov. By visiting the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

Commonwealth of the Northern Mariana Islands (CNMI)

From 2002 to 2007, real GDP of the CNMI decreased at an average annual rate of 4.2 percent. The decrease in real GDP was primarily accounted for by a decrease in the exports of garments (reflecting a contraction in the garment manufacturing industry) and a decline in tourism. In 2005, the garment industry was impacted by reduced quotas on the imports of foreign textiles and garments. Since 2002, a number of economic shocks have contributed to a decline in tourism, including the SARS epidemic and the suspension of flights from Tokyo by Japan Airlines.

Summary Statistics for the CNMI
  2002 2003 2004 2005 2006 2007 2002-2007
AAGR 1
GDP (millions of dollars) 1,320 1,267 1,229 1,073 1,007 962 -6.1%
Real GDP (millions of chained 2005 dollars) 1,197 1,223 1,206 1,073 1,006 967 -4.2%
Population 2 74,372 76,617 78,889 70,636 60,662 58,629 -4.6%
Real GDP per capita (chained 2005 dollars) 16,095 15,963 15,287 15,191 16,584 16,494 0.5%
1. Average annual growth rate. 2. Source: U.S. Census Bureau, International Database.        

Percentage change of Real GDP Growth for CNMI 2002-2007

From 2002 to 2007, the population of the CNMI decreased rapidly as foreign workers left the territory, and as a consequence, real GDP per capita increased at an average annual rate of 0.5 percent.

Chained (2005) dollars Per Capita Real GDP CNMI 2002-2007



CNMI
Table 1. Gross Domestic Product
Line
[Millions of dollars]
2002 2003 2004 2005 2006 2007
Gross domestic product
1 1,320 1,267 1,229 1,073 1,007 962
 
Personal consumption expenditures 2 538 553 549 511 560 566
 
Private fixed investment 3 23 22 41 39 33 22
 
Net exports 4 388 344 292 188 53 20
  Exports 5 1,104 1,056 1,156 930 752 548
   Goods 6 875 836 870 694 537 364
   Services 7 229 220 287 235 215 184
  Imports 8 717 712 864 742 699 529
   Goods 9 679 673 815 701 663 501
   Services 10 38 39 49 40 37 28
 
Government consumption
 expenditures and gross investment
11 371 347 347 335 362 354
 Federal 12 11 15 12 11 11 10
 Territorial 13 359 332 335 324 351 344


CNMI
Table 2. Real Gross Domestic Product, Chained Dollars
Line
[Millions of chained (2005) dollars]
2002 2003 2004 2005 2006 2007
Gross domestic product
1 1,197 1,223 1,206 1,073 1,006 967
 
Personal consumption expenditures 2 532 563 549 511 551 549
 
Private fixed investment 3 25 23 42 39 32 21
 
Net exports 4 259 263 260 188 79 68
 Exports 5 1,072 1,038 1,142 930 737 542
  Goods 6 846 818 861 694 531 360
  Services 7 226 220 281 235 206 180
 Imports 8 813 775 882 742 657 474
  Goods 9 775 736 833 701 620 448
  Services 10 38 40 49 40 38 25
 
Government consumption
 expenditures and gross investment
11 382 380 353 335 343 318
 Federal 12 12 15 12 11 11 10
 Territorial 13 369 365 340 324 331 307


CNMI
Table 3. Percent Change From Preceding Year in Real Gross Domestic Product
  Line
[Percent]
2003 2004 2005 2006 2007
Gross domestic product
1 2.2 -1.4 -11.0 -6.3 -3.8
 
Personal consumption expenditures 2 5.9 -2.5 -7.0 7.8 -0.3
 
Private fixed investment 3 -6.1 80.5 -7.7 -17.7 -33.2
 
Net exports 4 …….. …….. …….. …….. ……..
  Exports 5 -3.2 10.0 -18.6 -20.7 -26.5
   Goods 6 -3.3 5.2 -19.3 -23.6 -32.2
   Services 7 -2.5 27.8 -16.3 -12.6 -12.2
 Imports 8 -4.6 13.8 -15.9 -11.4 -27.9
   Goods 9 -5.1 13.2 -15.8 -11.6 -27.7
   Services 10 4.1 24.7 -18.2 -7.0 -32.4
 
Government consumption
 expenditures and gross investment 11 -0.3 -7.2 -5.0 2.2 -7.3
 Federal 12 24.8 -18.4 -9.5 -0.7 -9.3
 Territorial 13 -1.2 -6.7 -4.8 2.3 -7.2


CNMI
Table 4. Contributions to Percent Change in Real Gross Domestic Product
Line  
2003 2004 2005 2006 2007
Percent change:
  Gross domestic product 1 2.2 -1.4 -11.0 -6.3 -3.8
Percentage points:
Personal consumption expenditures 2 2.46 -1.10 -3.16 3.74 -0.17
 
Private fixed investment 3 -0.11 1.43 -0.26 -0.64 -1.09
 
Net exports 4 -0.07 0.32 -6.17 -10.05 0.15
 Exports 5 -2.72 8.37 -17.54 -18.14 -19.82
   Goods 6 -2.27 3.47 -13.75 -15.32 -17.24
   Services 7 -0.45 4.90 -3.80 -2.82 -2.58
 Imports 8 2.65 -8.05 11.37 8.09 19.97
   Goods 9 2.77 -7.29 10.64 7.83 18.70
   Services 10 -0.12 -0.76 0.73 0.26 1.27
 
Government consumption
  expenditures and gross investment 11 -0.10 -2.07 -1.43 0.69 -2.71
  Federal 12 0.23 -0.22 -0.10 -0.01 -0.11
  Territorial 13 -0.33 -1.85 -1.33 0.70 -2.60


CNMI
Table 5. Percent Change From Preceding Year in Prices for Gross Domestic Product
and Price Indexes for Gross Domestic Product
Line
2002
2003
2004
2005
2006
2007
[Percent]
    Gross domestic product 1 …….. -6.1 -1.6 -1.9 0.1 -0.7
Personal consumption expenditures 2 …….. -3.0 1.8 0.1 1.6 1.5
[Index numbers, 2005=100]
  Gross domestic product 3 110.3 103.6 102.0 100.0 100.1 99.5
Personal consumption expenditures 4 101.2 98.2 99.9 100.0 101.6 103.1


CNMI
Table 6. Gross Domestic Income
Line
[Millions of dollars]
2002 2003 2004 2005 2006 2007
  Gross domestic income 1 1,320 1,267 1,229 1,073 1,007 962
Compensation of employees 2 678 632 660 555 534 535
Taxes on production and imports less subsidies 3 128 152 167 165 142 120
Gross operating surplus 4 514 483 402 354 331 308