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GP3June:  Pinehurst:  Lessons in Regional Development

Carmel Without the Ocean.  A couple of weeks ago we toddled off to Pinehurst, one of the four or five exceptionally fine spots in North Carolina, and certainly the only oasis near its core cities of Charlotte, Greensboro, and Raleigh. 

It was created by the Tufts family of Massachusetts, but it is now owned by the Club Corporation of Dallas, owner and operator of a bunch of middling golf and country clubs around the country.  This turn-of-the-century resort is in surprisingly good shape, offering several entertainments well beyond the golf for which it is so well known.  The spa gives professional strength rubdowns; the walk around town offers sightly houses and a petit, decorous shopping district, and the miniature golf course in neighboring Southern Pines is by far the most pleasant you will find in the state.  Just a few miles away, the botanical gardens at Sand Hills College are one of the better kept secrets in the Southeast.  We will be talking about all these rather unknown delights on the Global Province in the weeks to come.  This is Carmel without the sea, a very nice real estate concoction that pretends to antiquity and where antiques do retire. 

Unrealized Potential.  The sandhills are only half what they could be.  The legal beagles of Pinehurst’s parent have barred locals from using the Pinehurst name, so a few local enterprises have had to come up with new monikers.  They’re myopic when it comes to thinking about North Carolina.  With absentee ownership, the Pinehurst resort has been terribly absorbed in its own care and feeding, not looking to the nourishment of the community lying outside its own holdings.  Yet there could be a major, uplifting spillover effect from this golf course tourism if the right spirit took hold.. 

This is of some concern since North Carolina has flattened out economically, and it needs a boost from locally based enterprises willing to think about how to get it moving again.  Its relatively affluent communities have not had a halo effect on their neighbors.  The mercantilist attitudes of its prime movers, inert state government, and the tunnel vision of national business chains, headquartered elsewhere yet so dominant in its business life, are not a potent combo for growth.

Tourism Not Inconsequential.  Pinehurst is worth looking at, because tourism does mean a lot to the state.  In 2001 some 43 million visitors plunked $11.9 billion in the tills: it is a big industry for Tarheeldom and puts the state surprisingly high in national tourist ratings.  Because of absentee ownership and low per-capita tourist expenditures, however, not enough dollars stick to the North Carolina economy.  Tourist dollars provide tax receipts and lots of low paying jobs, making the politicos happy, but do not create enough growth in capital, physical assets, or intellectual infrastructure. 

Tourism can mean much more.  It would take more Pinehursts operated with a strong view to regional development.  In other words, there’s tourism and there’s tourism.  With the meltdown of its manufacturing base, North Carolina would surely benefit from growing the right kind of tourism.  It can be reasonably expected that domestic vacations will continue to grow, as the fear of flying flourishes.  Then too, the market will expand as a burnt-out workforce looks for the right kind of rest and recuperation.

Creating a Destination:  Wilmington.  The state now lacks a destination—a Washington, D.C., an Orlando, a Las Vegas.  The hope in time is that it will create one, most likely at Wilmington, its almost seaport.  It will take a Rouse Company—and other co-venturers—to make Wilmington all it could be.  Yet proper development there could set the stage for economic activity  in the eastern part of the state, which is so sorely beset now.  Oddly enough, a North Carolina for vacationers must have an urban experience as well as its country pleasures if the economy is going to get a charge out of tourism.

World Cup Tourism.  Countries that aren’t getting their share of tourists understand that tourism brings more than dollars, creating a waterfall of collateral benefits.  Japan and Korea are hoping the World Cup soccer matches will kickoff a substantial rise in long-distance visitors.  “Japan has set a goal of eight million foreign visitors a year by 2007, up from 4.8 million in 2001.  South Korea is aiming for 10 million by 2011, compared with only 5.1 million last year.”  See the Wall Street Journal, May 29, 2002, p. D3.  This suggests that you need big events as well as key destinations to really prime the high-value-visitor pump if you are not now capturing enough tourist dollars.  The Carolinas, of course, could do this with golf, drawing many more long-distance, high-value visitors, rather than the regional influx it gets today.

North Carolina, South Korea, Japan.  Well-conceived tourism is more than frosting on the cake:  it can contribute terrifically to development.  Interestingly enough, it is not enough to go from a regional to national audience.  Your product and your lines of distribution must reach right out to all the world,  achieving a cosmopolitan feel even in the most provincial of landscapes.  Development experts at the World Bank and elsewhere might think about how tourism can be styled so as to be a transforming experience, rather than a bothersome part of the economy serious economists have a hard time thinking about.  We still lack to the will and knowledge to make Johnny Appleseeds out of all our travelers.

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