HAWAII

Hawaii's competitive advantages

Several competitive advantages make Hawaii an ideal site for business investment and growth. Industries such as agriculture, environmental technology, renewable energy and tourism provide unique opportunities for investment. In addition, its physical location, cultural advantages, and growing strength in key industries all make Hawaii an advantageous state to work and grow in.

As stated above, Hawaii’s agriculture industry has shifted over time from small farms to large plantations and now is seeing a shift back to small farms specializing in rare delicacies such as macadamia nuts, Kona coffee, and exotic fruits, much of which is exported to countries such as Japan and Canada and throughout South East Asia.

In addition, due to the state’s unique climate, environmental technology and renewable energy research are growing in large numbers. HEET-Hawaii Natural Energy Institute at the University of Hawaii Manoa is partnering with the University of Hawaii and the Naval Research Institute (NRL) is conducting development and testing on advanced fuel cell systems. Also, NASA has an Infrared Telescope Facility Institute for Astronomy at the University of Hawaii that conducts state of the art research in astronomy.

The state also offers many financial and capital resources for businesses wanting to start up a new business in Hawaii or expand and existing one. More information about these programs can be found on DBEDT’s website at: http://hawaii.gov/dbedt/business/advantages/financial.

Economic Potential of Hawaii

Hawaii's future economic potential lies in several key industries including agriculture, alternative energy, film and tourism, health services, higher education, manufacturing and technology, and transportation.

• Hawaii's economy is largely dependent upon its $10+ billion-a-year tourism industry. However, agriculture in Hawaii is both growing and changing and revenue from diversified (varied) agriculture has doubled in the last 20 years. Approximately 12,000+ people work on farms with most in the diversified agricultural sector. The Big Island of Hawaii is the state leader accounting for 1 million of the state's 1.8 million acres in diversified agricultural production.

• Clean technology, a category that includes ethanol and biodiesel, has attracted growing public attention and investor interest amid efforts to decrease dependence on imported oil and reduce emissions associated with global warming. Hawaii's energy policy seeks to ensure dependable, efficient, and economical energy; increased energy self-sufficiency; greater energy security; and reduction of greenhouse gas emissions. The objectives in the area of Alternate and Renewable Energy are to promote commercialization of Hawaii's sustainable energy resources and technologies to reduce the state's high dependence on imported oil, increase local economic development, and reduce the potential negative economic impacts of oil price fluctuations.

• Hawaii has gained a reputation as the world's premiere tropical location and a favorite for film, television and commercial productions. Within the six main islands, film and television producers are able to take advantage of Hawaii's diverse climatic zones (Hawaii boasts all but two of the world's climatic zones), ranging from tropical rain forests to arid deserts, from alpine meadows to lunar-like volcanic landscapes.

• Tourism is a major economic driver for the United States for it supports 7.5 million jobs and $177 billion in payroll and contributes $10 billion in tax revenue. While the U.S. tourism industry has declined since 9/11, Hawaii’s tourism market is still seeing a growth in visitors. Once again, due to Hawaii’s climate zones that make it warm year-round, it makes an ideal location to vacation all year especially when visitors want to “escape from winter”. Hawaii’s tropical plants and endangered species make it a desirable destination for visitors interested in learning more through tours. It is currently looking to diversify the tourism industry itself, which will also lead to more diversification in Hawaii’s economy as well. New areas such as Agro-tourism, Cultural Tourism Ecotourism, Health and Wellness Tourism and Technology Tourism are just a few of these new diverse areas that are springing up within the tourism economy.

• The health service industry provides 12.9 million jobs nationally. Approximately 16 percent of all new wage and salary jobs created between 2002 and 2012 will be in the health service industry, which is more than any other industry in the U.S. Hawaii has 16,700 highly skilled primary and specialized physicians, nurses, and medical technicians offering a variety of treatments and services. Hawaii is home to the trauma and burn center for the Pacific Rim and also offers specialized heart, cancer, and chronic disease program for children.

• Much of Hawaii’s future rests on higher education. With employment nearly 6,000 and an annual cash flow of close to $1 billion with the education sector, the University of Hawaii is among the largest institutions on the island. Education is the medium and condition for social mobility, and in the new economy a well-developed education is as important as hard work. Many people have also gone back to school to re-structure their lives, many of which were disrupted with the change in economy due to the decline in large plantation agriculture. Hawaii’s 284 colleges and universities provide the space to see this change come to fruition. In addition to changing the lives of those on the island, education is also being seen as an export. With many Southeast Asian nations facing serious educational shortfalls, and Hawaii’s student body could increase significantly by using telecommunications to export education abroad. With this, expansion will be needed to meet the demand of this new student body and Hawaii foresees much growth in this sector.

• Trade and manufacturing have been founding industries in the United States’ history, and continue to be driving industries for the economy. The International Trade Administration, Department of Commerce, furnishes statistics for merchandise export sales by business located in 253 of the nation’s Metropolitan Statistical Areas (MSA). Export-supported jobs linked to manufacturing account for an estimated 0.8 percent of Hawaii's total private-sector employment. Approximately 2.2 percent of all manufacturing workers in Hawaii depend on exports for their jobs.

• The technology industry has seen tremendous developments within the last thirty years. While the technology industry in Hawaii is relatively small, relative to other states, it does have a strong technical infrastructure and there are strong possibilities for commercial and legislative reform including internet providers, software development and testing laboratories.

• Hawaii’s geographic location presents major challenges for the state and the residents and tourists are dependant upon all modes of transportation to travel between islands. Currently the primary modes of transportation are: air carriers, cruise ships, ferries, public transportation vehicles, private buses, rental cars and taxes. As tourism and other industries grows so too will Hawaii’s modes of transportation need to grow to meet the demand of the market. Additional inter-island ferries and air travel will add to the existing systems.