Minister of Finance Elbuchel Sadang reported that due to lower tourism performance this year, they are expecting a $3 million shortfall in the projected revenue for 2019.

“We had projected for 115,000 visitors for 2019, but I think we will hit 100,000 this year resulting in about $3 million shortfall over our projected revenue for 2019.  We have put a cap on government spending to ensure that we have a balanced budget by the end of the year,” reported Minister Sadang in his presentation to Belau Tourism Association members yesterday.

Minister Sadang reported that some of the key assumptions they had for 2019 fell short of their expectations.  One was the number of visitor arrivals, the airlines not coming online as promised and the slow start of construction projects due to limited materials on island.

Drop in arrivals have impact on Gross Receipt Tax collections, Hotel Room Tax and PPEF.

Meanwhile, Palau Visitors Authority projects reaching 90,000 visitors by year end.  Visitor arrivals this year have been consistently 20% less that previous year.  With 3 months remaining, monthly arrivals must reach over 10,000 to meet the Finance projection of 100,000 for this year.

Skymark Airline was expected to start service early this year to fill the void left by Delta Airlines when it pulled out of Japan-Palau route.  China Airlines was also expected to increase number of weekly flights from Taiwan to Palau and also open Taiwan-Japan-Palau route.

To date, Skymark have not given a firm date as to when it will commence services to Palau.  China Airlines added another flight from Taiwan since June.  Korean Airlines paused services since June and is expected to resume flights late October or early November.  PAPA charters are also suspended for 2 months pending internal matters.

Minister Sadang remained optimistic about 2020 saying that some airlines are expected to resume or start services to Palau.  Korean Airlines, China Airlines, T-Way, Vietjet and PAPA will either resume or add on services to Palau. (By L.N. Reklai)