BY HAWAII REPORTER
In what would normally be good news for Hawaii’s tourism industry, the Japanese yen appreciated to its highest level in decades against the dollar on Wednesday.
The yen strengthening against the dollar is usually good news for the visitor business because it means Japanese travelers have more to spend while in Hawaii. Japanese visitors represented about 17 percent of tourists coming to Hawaii last year.
But instead it appears the market may be depressed in coming months as Japanese citizens curtail travel in the wake of catastrophic losses from last week’s earthquake and tsunami. Airline passenger counts from Japan have dropped dramatically in the past week.
Figures compiled by the state Department of Business, Economic Development and Tourism show Japanese passenger counts since the earthquake were off by 28 percent compared to a year earlier. That period includes a time when flights did not operate and the figures may also be affected by people departing the country because of radiation worries.
But tourism officials believe Japanese vacations will slide in coming months.
The yen fell to below 78 to the dollar on Wednesday, breaching a post WWII low of 79.75 achieved in April 1995. Foreign currency traders have said the rally against the dollar is occurring for several years, including the belief that Japanese corporations will repatriate some of their cash back to Japan.
While the spike in yen’s strength is good for Japanese tourists shopping in Hawaii, it also will make goods imported from Japan more expensive.
Hawaiian Airlines’s efforts to build an airline known for on-time flights and customer service appear to be paying off.
The Honolulu-based carrier is one of the top-three U.S. air carriers with high brand equity, according to the 2011 Harris Poll EquiTrend study. The survey identifies companies with the highest brand equity.
“As consumers continue to look for ways to reduce their budgets, having a brand that consumers trust and respect plays a large role in keeping consumers loyal,” said Jeni Lee Chapman, Executive Vice President for Brand Research at Harris Interactive. “Consumers continue to be more selective about what they purchase, but those companies with high brand equity are able to avoid switching behaviors of those brands that lack brand equity.”
Hawaiian cracked the list for the first time, placing third after Southwest Airlines and JetBlue.
In the automotive category Ford took top honors for full-line automakers and Mercedes-Bez ranked as the best luxury automotive brand; Hilton Hotels and Resorts was best in full service hotels; Panera Bread was best in casual restaurants and Subway best in quick service restaurants.
Verizon was the highest ranked mobile network, Target the best value retailer and Coca-Cola the best carbonated beverage.
Demand Overwhelming for Aloha for Japan t-shirts
A group of local designers and merchants who created the “Aloha for Japan” t-shirt as a way to raise funds for Japanese earthquake and tsunami relief efforts say they’ve received an outpouring of orders.
People trying to order online from one of the merchants are being told to expect to wait at least two weeks for delivering because of the order backlog. Fitted Hawaii, a retailer on Kona St. in Honolulu, is telling Internet customers there’s been “extremely high demand” and that people coming into its Honolulu store can be put on a waiting list.
The t-shirts cost $20, with profit going to help Japan’s people. The shirts can be ordered through the http://alohaforjapan.com/ website.
The t-shirt sales are part of a coordinated statewide effort to collect donations for the disaster victims. Lt. Gov. Brian Schatz’s office announced Wednesday the state’s largest banks had agreed to serve as collection points for donations.
Other efforts are expected, including concerts and TV programs. A 45-person committee of business leaders has been formed to help direct the relief efforts.
More Disasters Occurring? It’s Not Your Imagination, UH Economist Says
University of Hawaii economist Ilan Noy, writing on the Econbrowser website, notes that there have been more disasters worldwide of late, but that the increase is probably being driven by better reporting of milder events and that large disasters have remained fairly steady.
Noy’s observation about disasters were made in a column about trying to assess the likely economic impact of disasters in the aftermath of Japan’s earthquake and tsunami and ongoing nuclear crisis.
“Remarkably, in spite of a spate of catastrophic disasters in the last decade (the East Asian tsunami of 2004, the Kashmir earthquake of 2005, and the Sichuan earthquake in 2008 to name a few), we have a fairly limited knowledge of the likely macroeconomic impacts of these events,” Noy wrote.
But he said direct damages are typically higher in less developed nations and those with weakened institutional capacity.
“This makes the Sendai earthquake unusual, since it caused very significant damage in a very prosperous country, and one that is typically considered very well prepared to mitigate these events. While the final death toll is still unclear, it appears it will be quite significantly larger than the Kobe earthquake of 1995, the most fatal natural disaster to hit a developed country in many years (when about 6400 people died).”
He wrote that studies show the short-run indirect damages tend to favor developed countries as well, with those with higher per capita incomes, higher literacy rate, and better institutions being less vulnerable
Research into the long-run impact of natural disasters on GDP isn’t as conclusive, Noy said, with some research suggesting it may lead to greater growth. Some say it could lead to an exodus from the region as occurred with Hurricane Katrina.