Tourism, refunds boost economy at end of 2011 - KUAM.com-KUAM News: On Air. Online. On Demand.

Tourism, refunds boost economy at end of 2011

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by Krystal Paco

Guam - While the island's economy in 2011 got off to a rough start with the disasters in Japan and the setbacks with the military buildup, the year ended on a positive note making for an optimistic outlook for 2012. 

Looking back, 2011 wasn't too shabby for Guam's economy. According to the island's chief economist Gary Hiles, despite the tsunami disaster in Japan in March, the island's visitor industry recovered just in time for the holidays. "It's been recovering nicely," he began. "As of November, the numbers show that we're up to actually a little bit above last year, so we're recovering and that's providing a lot of stimulus for the economy. On top of that, we just had the bond issue released for the tax refunds, which is providing a big stimulus for December."

December numbers are looking good as anecdotal evidence and online opinion polls say that after paying bills, tax refund recipients hit the stores for Christmas shopping. With locals contributing to 75% of the retail trade, Hiles says storeowners ended the year on a high note and anticipates total sales for the year to increase by 3.2%.

"So with the additional expenditures into the economy with the bond issue with the recovered tourism, I'm predicting the December retail sales will be the highest in the history of Guam," he added.

Despite delays in the much-anticipated relocation of troops from Okinawa to Guam, Hiles hopes numbers will bounce back with the approval of the Russia visa waiver.

"The good thing is the delay in the buildup is not taking away from existing economic activity; it certainly is going to cut into or eliminate much of the expansion in the economic activity that was planned previously," Hiles said. "In the longer term, we're really going to be dependent on increased tourism and there's positive news there with the Russian visa waiver, and there's also hope for increased construction."

While there's strong optimism for the New Year, only time will tell how the island will fare in 2012. 

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