Tinian Dynasty investor Chinese Strategic Holdings Limited has announced that it has signed a letter of intent with China Duty Free Group Co. Ltd. to operate a concession program at the airports and seaports in the Northern Marianas.
Chinese Strategic Holdings Limited, in its latest filing in the Hong Kong Stock Exchange, said the company and China Duty Free Group are forming a joint venture and “will apply to the Commonwealth Ports Authority of the CNMI for the requisite licensing, and the right to build and operate duty free shops at the airports and seaports of both Tinian and Saipan.”
This comes at an opportune time for the Dynasty investor as the current operator of the concession program at the Saipan airport, DFS T Galleria, is looking to renew its master concession agreement with the Commonwealth Ports Authority, with its agreement expiring in November of this year.
Its current contract with CPA is expiring on November 13, 2015.
Chinese Strategic Holdings Limited noted in its announcement that there is no duty free shop at the Tinian airport; however, DFS had earlier indicated its willingness to operate a shop on Tinian. Currently, there are no duty free shops on either Tinian or Rota.
CPA’s consultant, Ricondo & Associates, reported earlier that operating a shop on either Tinian or Rota is a losing proposition due to low tourism numbers.
But Chinese Strategic Holdings Limited is upbeat over the potential for the growth in the Chinese outbound travel market.
On the HKEX, the company stated that they “would fully utilize their respective competitive edge to inaugurate and further develop the Duty Free Project in the CNMI.”
China Duty Free Group is the only state-owned enterprise authorized by the State Council of the People’s Republic of China to operate a duty free business across the country, and has established long-term cooperative relationships with more than 300 top luxury brands in the world.
Meanwhile, South Korean company, Lotte, had earlier announced its interest to participate in an open bid for the concession program in the Northern Marianas. Lotte had replaced DFS on Guam in operating a duty free shop at the airport there.