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04/16/25 - Gov. Arnold I. Palacios said the CNMI may see some economic growth opportunities following U.S. President Donald J. Trump’s decision to levy reciprocal tariffs for countries and territories judged to have major tariffs on U.S. goods.
“That's going to be an interesting thing, and we're looking into it and see what kind of opportunities come of it. We have been on that subject, looking at how the Commonwealth could be in a position to take that opportunity and run with it,” he said during an interview following last Friday’s ribbon-cutting ceremony of Docomo Pacific’s expanded call center.
Under Trump’s tariff proposal, the United States will impose a base tariff of 10% on all foreign imports, with rates between 20% and 60%. Last week, the Trump administration decided on a 90-day pause on the tariffs, save for China that now has to deal with a tariff of 125%.
“We've been talking to several companies already and several people regarding what kind of positions, positioning, whether it's soft manufacturing on Saipan or in the Commonwealth. We need to take advantage of whatever opportunities there is that that presents,” said Palacios.
In fact, he said Japanese automotive manufacturer, Mazda Motor Corp., has shown interest in the CNMI when the word first came out about potential tariffs from U.S. imports.
“We talked to Mazda a couple of months ago, and they're looking at opportunities here. That's a good thing coming out of the pipe. Yeah, of course, they're going to have to make that assessment themselves, and we also have to make that assessment.”
As for the Commonwealth being affected by a rise in the prices of commodities due to the potential tariffs on imported goods, Palacios said that may not actually be the case.
“The tariff is not going to impact the Commonwealth. We are outside of the U.S. customs system. Tariffs are not going to impact us...What I've been advised on is that it's not, because the tariffs into the insular areas don't kick in, because we have our own customs system here. “
Palacios also said the Commonwealth Economic Development Authority is currently looking at existing federal laws that govern tariffs in the Commonwealth to see how the CNMI could address the issue of potentially bringing in investors outside of the Commonwealth.
“There are opportunities for the Commonwealth in the insular areas in that regard... We need to take full assessment of that, because we've been having some very interesting inquiries from companies, U.S. companies, and even foreign investors taking a look at it,” he said.
Palacios also said he’s concerned about the fate of the Northern Marianas Humanities Council after the National Endowment for the Humanities terminated all its grants effective April 2, 2025.
“I got a letter, I got the same forwarded to me by [council executive director Leo] Pangelinan and, you know, it's disheartening that that has happened to our Humanities Council program. But I encourage him to continue to go after federal funds, whether it's through the [Administration for Native Americans] grants or the humanities, the NEH grants. We're going to be kind of riding to, I know that Kimberly King-Hinds is already on top of this, trying to take them home.”
NEH grants awarded to the council account for approximately 93% of its annual operations and programmatic expenses. It currently receives no funding from the CNMI government and cash donations from supporters amount to 5% of its total revenues.
“But obviously, there are other avenues, whether it's local and federal funds, so we need to see what we can do,” Palacios said.
Story by Mark Rabago
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