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HONOLULU, Hawaii (September 22, 1997 - PIDP/CPIS)---Continued expansion of the visitor industry and growing per capita income are expected in Guam according do a detailed economic report just published by the Bank of Hawaii.

The bank's regional economist, Wali Osman, says "If Guam keeps going at the rate of the last decade, hotel rooms on the island will have to double in the next five to ten years."

Japan sends the most tourists to the U.S. north Pacific territory, accounting for over 75 percent of last year's 1.4 million arrivals. Korea is second, at 14 percent.

The cancellation of all Korean Air flights to Guam effective October 1, however, as a result of last month's jumbo jet crash on the island, is certain to reduce Korean visitor numbers at least temporarily.

There are other challenges ahead for Guam's tourist industry, Osman says, particularly the Japanese exchange rate ups and downs and the need to upgrade a burdened infrastructure, including roads, sewers, water and power systems. "The capacity of the ecosystem to absorb more traffic will have to be factored into any realistic development plans," he adds.

Osman also notes that Guam, located between the Northern Mariana Islands and the Federated States of Micronesia and with a population of 153,000, is developing into a major regional retail center. Several major U.S. department and discount stores have opened or expanded successful Guam branches in recent years.

Defense, formerly Guam's economic mainstay, is downsizing and will not be a future growth area, says the Bank of Hawaii economist.

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