Hawaii: Potential in the Pacific

On the green and rolling south shore of Hawaii's Maui Island last week, a huge new doughnut-shaped machine ground into action. It swallowed up thousands of chunks of sugar cane in its maw, and by swirling them through a bath of warm water for nearly an hour, extracted an unprecedented 97% of the sugar from the cane. If the machine continues to perform as well as expected, says Harold Eichelberger, president of American Factors, Ltd., its owner, "I doubt that anyone will ever again build another sugar mill." The sugar business, long Hawaii's basic industry, is not the only thing that is changing in the 50th state. From one end of the 1,450-mile archipelago to the other, Hawaii's economy is maturing with the speed of a tropical plant.

More Malihinls. Hawaii was in the midst of an economic boom when it was admitted to statehood in 1959, but the boom went too high too fast, and the subsequent letdown slowed Hawaii's growth. The new surge of business activity, supported by a broader, sounder and more realistic base is expected to make 1964 Hawaii's best year since statehood. Once dependent largely on two crops—sugar cane and pineapple—and the presence of U.S. military bases, Hawaii is finally growing up economically. "For centuries, the emphasis in commerce and business was centered in the Atlantic," says Hawaiian Entrepreneur Chinn Ho. "Now the Pacific is growing in its turn. If we can grasp the enormous changes, this will mean Hawaii will develop even faster than we can imagine."

Military installations still pour more money into Hawaii's economy than any other source ($535 million in 1963), but dramatic gains are being made by light industry and tourism. Some 600 diversified companies now produce everything from muumuus to mirrors, have expanded light-industry sales from $71.6 million in 1950 to $255 million last year. Attracted by Hawaii's clear skies, stable temperatures and vast beaches, half a million malihinis, or tourists, will leave an estimated $221 million in the state this year, compared with the 100,000 who spent $55 million in 1955. Agriculture is finally diversifying: sales of Hawaiian coffee, papaya, macadamia nuts and other products totaled $45 million last year, and the islands now produce 80% of their poultry and egg needs.

Jumping Boom. The most visible and dramatic signs of Hawaii's expanding economy are its skylines. Construction for this year's first half reached $151 million, up 17.6% over the same period last year. At Honolulu's Waikiki Beach, a $27 million, 30-story condominium and hotel called the Ilikai was completed last month; built by Chinn Ho, it is the world's largest single-unit apartment building. The lovely Kahala Hilton, which cost $11 million, opened in January. In downtown Honolulu, a subsidiary of Castle & Cooke, the biggest of Hawaii's "Big Five" companies, will soon raze a square block for the erection of a $14 million business complex. Not far away, work will begin next year on a 3,000-acre suburban community to be called Waipio, which will eventually house 60,000 people. Henry Kaiser is building a $4,000,000 freeway extension between downtown Honolulu and his Hawaii Kai, a 6,000-acre planned community that will eventually cost $200 million.