Good morning ladies and gentlemen! I am quite pleased to be here with you today and would like to thank the Maui Pacific Center for the invitation. I have to say that when I received the invitation, before I knew what my topic was going to be, one of the first things that came to mind was, "good, I will find out from the participants ways to increase and strengthen membership for our Chamber of Commerce". Well, here I am talking about strengthening membership. I still intend to learn from you throughout this week some of the successful strategies each of you have employed to increase and strengthen membership in your organizations.

INTRODUCTION

My presentation will be limited only to strategies the Palau Chamber of Commerce has implemented to help strengthen its membership. I will provide a brief overview about the Republic of Palau and about the Palau Chamber of Commerce. I will also touch on challenges we have faced and still face today in our effort to increase and strengthen our membership. Not all strategies have succeeded and as I say, I hope to learn from you new ideas that might work for us.

Republic of Palau is the western most island group of Micronesia. It has a total land area of 170 square miles. It is about 2,500 miles from Tokyo, 4,500 from Honolulu, 1,500 miles from Sydney, and about 500 miles from Manila. It is in the same time zone as Tokyo. It has approximately 18,000 plus population, about 4,000 of which are non-resident workers. It has an 8,000 plus labor force, half of which is imported labor. We became a sovereign nation in 1994 with the 50 year Compact of Free Association with the U.S.A.

Economic Overview

Palau uses the U.S. dollar. Its GDP in 1997 was projected at 159 million with per capita GDP of $8,800. Our main sources of income came from Compact payments, tourism, services, trade, fishing and agriculture. In the last two years, Palau was impacted by the Asian economic crisis which affected our tourism industry. Projected visitor arrivals have been dropping for the last two years at an average rate of 12%. Compact payments have helped to keep the economy steady, contributing over 70% overall of the GDP.

According to the Bank of Hawaii 1997 Economic Report, Palau's GDP was growing at 24.2% per year. I am not an economist by any stretch of imagination but despite the last two years of recession, particularly in the tourism sector, Palau cannot ignore the fact that indeed the Compact payment continues to be a major contributor to our national GDP, at least for the next nine years. The challenge ahead of us is to build a strong private sector to replace possible loss or decline in the Compact payments after the nine years. That challenge is further complicated by population concerns, sustainable development concerns and environmental concerns.

PALAU CHAMBER OF COMMERCE

The Palau Chamber of Commerce is quite a young organization. It was established in 1992, with 18 incorporating members. It is a non-profit organization, with a nine member Board that have staggered terms of two and three years. It has only two staff. I was hired in 1994 to establish the office and to start the whole operation. We have since increased our membership to 80 registered businesses. Due to our dues structure, registered businesses actually represent more than one business. So basically, we have over 170 companies represented in the Chamber. This is out of the total of 1,200 registered businesses in Palau.

The Palau Chamber of Commerce has been fortunate for a couple of reasons. One, we have two older and much larger Chambers close to our region that have provided support as well as experience to help us in our growth; namely Guam Chamber of Commerce and Saipan Chamber of Commerce. We have also established sister relationships with Cairns Chamber of Commerce of North Queensland, Australia, and Davao Chamber of Commerce & Industry in Mindanao, Philippines, from which we have also gained some insights on how to raise membership. In terms of diversity, it represents quite a broad range of interests.

Unique Challenges to Growth

Although, there are a lot of similar issues and experiences in organizations such as Chambers of Commerce, Business Associations and other member-based entities in different areas of the world, those that exist in small island communities usually have a few unique challenges that larger communities would not have, such as the following:

• Small base of resources to draw from
• Political personalities
• Credibility
• Issues of national scale or interest
• Cultural expectations

Depending on how you read our Bureau of Tax & Revenue report, we have a total of 1,200 plus businesses registered or 600 plus business owners. I was told by a couple of very successful Chambers of Commerce in the States, that a successful Chamber usually garners about 35% to 45% of businesses in its area. With this scale, we might not be very successful for we have 80 business owners registered in our membership or 176 businesses represented. But then again, we have only been in existence since 1992, and in full operation since 1994.

Mission

Our organization's mission is quite broad and general, pretty much stating that we, from a business point of view, will promote, develop and support establishment of commercial business developments; and development and improvement of public services and infrastructures; etc. Quite a big order for such a small organization. Our motto states, "Palau Chamber of Commerce, your business advocate". It seems antagonistic to use the term advocate, but you have to understand, we probably have the highest number of lawyers per capita in the world. I believe we have over 100 lawyers for a population of 18,000 people.

In the short time we have been in existence, we find ourselves consistently defining our role and objectives and transferring that to our members. To acquire, maintain and strengthen membership, we have to provide added value to the membership that I do not believe our incorporating members even envisioned.

Member Services

Currently we provide the following services to our members:

• Lobby government on specific issues
• Inform our members of proposed legislation, proposed amendment to laws, regulations, and policies
• Weekly FYIs
• Trade information
• Export/Import information
• Statistics from various agencies
• Provide a forum to small working groups on specific issues (solutions to problems)
• Networking
• Business planning for small business
• New information via speakers on various issues
• Training through workshops (co-sponsoring and partnering with various agencies locally and internationally)

We find that the key to success is to ensure participation of members, whether in working groups or in networking sessions. The constant flow of new information to members is one successful method of maintaining their interest and participation. (Thank God for email.) I am told that one sure way to raise and maintain membership is to create a crisis. Fortunately, we do not have to do that. Our government conveniently does that for us. Part of our newly defined role is that of a marketing agency for businesses. We do not market a product but we market the image of the business in the community. Sort of like an image consultant for business.

Public Outreach

I do not know about other islands but in a traditional Palauan community, most things are seen as communal properties such as land, houses, etc. Everyone gets together and pays for things and the benefits are shared. The way business operates sometimes gives people, particularly from the islands, the image of greed. "You want me to pay my credit for things I took from the store last year? I can not do that. I have customs coming up and I do not have money to pay my credit. You business people are greedy and mean!"

Part of our role is to educate people about how business operates; what it takes to run a successful business. Many local people may own businesses and hold government jobs, yet they are identified by their government occupations rather than their business. I was once asked how many people in our household work. And I said, just me. My husband who runs all of our five different businesses was considered unemployed. This perception makes it difficult, particularly when trying to bring local businesses into the organization.

Still, we find our resources stretched thinly over many issues. Each year, it seems our marketing funds keep getting slashed. We have tried a different tack -- leveraging. We have started cross membership with other associations such as Belau Tourism Association. This, we figure, is a cheaper marketing tool to reach a broader audience. It also provides us with another arena to market our ideas.

Strengthen Membership

Strengthening and maintaining membership are critical to organizations such as Chambers of Commerce. Not only are these necessary for the Chamber organization itself, but also to the higher objectives that the Chamber promotes. A strong support base, not only in terms of funds but also in terms of member support is vital to the Chamber if it is to achieve its goals of promoting more business, creating a positive climate for business, pushing for development of infrastructures and services needed by the business community to succeed, as well as other community oriented objectives that aim to create a healthy and strong community.

In conclusion, someone said that if you want to strengthen membership, you need only to create a crisis. Unfortunately, we cannot have crisis on a daily basis, and therefore, hard work and creativity both with finances and ideas is necessary. Raising and maintaining membership has been and is a continuing challenge that our organization faces daily and we believe that hard work and participation of our members are keys to success in this endeavor.

Once again, thank you.