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Economic Development

Disruptive Development in CNMI

Ryan Khurana
November 23, 2018

The Commonwealth of the Northern Mariana Islands provide a test case in how disruptive technologies present a new model of economic development.

Lost in the chaotic legislative battles of the current administration, a bill over the economic future of a small commonwealth of the United States has received little attention. The Commonwealth of Northern Mariana Islands (CNMI), which consists of 15 islands nestled between the Philippine Sea and Pacific Ocean, is at risk of losing its foreign workforce if Congress does not grant a visa extension past December 31, 2019.

The commonwealth, with a population of approximately 55,000 inhabitants, is composed of nearly 40 percent foreign workers and their families, mainly from the Philippines, China, and Bangladesh. These workers arrive with a special visa system known as a contract waiver that saves them some of the hassles of moving and working, though it leaves their permanent status unclear. Losing that foreign workforce would be devastating to the local, tourism-based economy.

Given the uncertainty around CNMI’s economic future, some individuals are taking actions to transform the Commonwealth into something more sustainable. The initiative being taken resembles that of Startup Societies, which use entrepreneurship and technology as a model to address governance problems.

Numerous projects are currently being trialed to revolutionize the way CNMI operates. Parts of the main city that are currently plagued with congestion are implementing artificial intelligence (AI) to optimize transit routes, parking, and improve the data that people rely on to navigate. Labor shortages that present challenges for new building projects are being addressed through the planned deployment of 3D printers that can print more complex parts, and collaborative robotics, which work alongside human workers to boost productivity. The public sector is experimenting with a transition to blockchain, a decentralized ledger technology, for accounting and record keeping, which would save money on manually updating files, and increase accessibility to different levels of administration.

The Commonwealth Development Authority (CDA), a local government agency dedicated to CNMI’s development, has been selling the value of innovation to the commonwealth’s small population. They invited in John McElligott of York Exponential, a collaborative robotics company, and David Rixter, a development consultant, to advise on modernizing the infrastructure. Among the public engagement projects are “pop-up hackathons” in partnership with IBM’s Watson AI team, which has supplied open source AI development tools for the islands, in order to allow innovators from all over the world to engage with CNMI and contribute to its development.

Rixter envisions CNMI as a real-world Wakanda, a reference to the 2018 blockbuster film Black Panther, in which a small, technologically advanced nation exhibits great wealth and development. CNMI is a vacation paradise, and given its limited technological infrastructure, has much to gain from deploying new technologies at scale. In more developed areas, the established companies, networks, and ways of doing things present obstacles for widespread adoption of new technology. The uncertainty surrounding CNMI’s economic future allows it to trial advanced robotics and blockchain in a way that will generate the necessary data for other developing neighborhoods.

In the rest of the United States, some worry that new technologies will destroy jobs, but CNMI is presenting a different perspective. “We shouldn’t ask if machines will take our jobs, but rather, why we are doing jobs meant for machines,” said McElligott. The collaborative role of the technologies that they are introducing, focusing on labor augmentation, rather than automation, provides lessons for other developing areas looking for growth. Augmentation applies technology to areas that humans find difficult, rather than replacing humans in areas they already work well. By collaborating with various stakeholders in implementing technologies such as AI, the current CNMI project may serve as a blueprint for human-centric disruption.

While we often think of technological advancement as something more common in developed areas, this not usually the case. Economic historian Douglas Irwin has argued in his papers that two essential criteria for rapid economic growth potential are having a shortage of labor and an abundance of unused land. The United States had these attributes in its early years, just as CNMI has them today. The capacity for new technologies to revolutionize people’s lives is much greater in parts of the world where previous developments have not become part of the infrastructure.

While CNMI is still in consultation stages on integrating new technologies, the opportunities created stretch far beyond their shores. Innovation is allowing for experimentation in governance and development—ones that are implemented by entrepreneurs rather than bureaucrats. This small American territory’s forward thinking approach to political challenges shows just how powerfully technological innovation can advance development.

This article originally appeared in FEE.

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