10 Mar 2008

Missile range cutbacks will impact on Marshall Islands economy

4:29 pm on 10 March 2008

The U.S. military's move to cut back its operations at Kwajalein atoll in Marshall Islands is part of a four year strategy to downsize there.

This year 6 million US dollars will be cut from the 250 million US dollars annual budget for the missile testing range.

At least 100 workers out of 1100 are expected to be made redundant - a move that will impact on people living on nearby Ebeye island where other job opportunities are scarce.

Our correspondent Giff Johnson says the implications for the local economy are huge.

"Also in a wider sense it will also impact the Marshall Islands which gets tax revenue from not only the Marshallese workers, but also the American workers who are also being cut back, with about 64 Americans losing their jobs...and this is just the opening cut."

Giff Johnson says many of the workers being laid off are likely to move to the U.S. mainland to find other jobs.