By Gerardo R. Partido
Variety News Staff

THE outlook for the island’s visitor industry for the first quarter of this year is not so bright and the travel agents selling Guam in Japan are not too happy.
The agents have complained about the weakened yen, a reduction in airline commissions, and an increase in Transportation Security Administration fees.
In addition, travel agents said the discounted landing fees recently implemented by the Guam International Airport Authority have not been passed on by the airlines.
Travel agents claim that there is an arrangement on discounted landing fees on Guam that was not passed on by Japan Airlines and other carriers to offset fuel surcharges and a reduction in commissions.
According to travel agent members of the Japan Guam Tourism Council, Guam is still able to generate a substantial volume of visitors but the low-cost tours have cut into their profit margins.
In the past, travel agents have also been able to count on local income from land operations but they now say that land operation revenues have declined significantly.
The very low tour pricing structure for Guam has marginalized or eliminated altogether the profits of the agencies.
This has been exacerbated by higher room rates, which may serve as a disincentive for Japanese travelers, and a restructuring in shopping commissions.
According to tourism industry analysts, Guam is still unique in that it is still 85 percent controlled by the travel agents. They said the Guam Visitors Bureau has no choice but to work with travel agents in selling Guam.
GVB said the Guam visitor market will be facing many pressures from other competing destinations this year.
The January to March 2007 period, in particular, will not have the market shift benefits caused by the tsunami aftermath and the cooling of relations between Japan and China.
These factors, GVB said, caused many Japanese travelers last year to pick Guam over China and other popular Southeast Asian destinations like Thailand.
According to GVB, Thailand’s tourism industry has recovered dramatically, China and Korea have become resurgent, and new destinations have become more aggressive.
Hong Kong, in particular, has been offering rock bottom rates for school tours and Okinawa has been drawing in more Japanese families and couples who schedule their weddings there.
Closer to Guam, the CNMI has launched a program to drive new business for groups of 10 people or more.
At this point, GVB said January bookings still don’t look too bad but Japanese visitor arrivals may flatten after this month.
The outlook for 2007 comes as the preliminary figures for calendar year 2006 arrivals show that Guam only received 1,108,396 visitors last year, a 1.5 percent decrease from the 2005 arrivals.
From October to Dec. 26, 2006, Guam had 265,677 visitors, which is 2.1 percent less than the same period in 2005.
For the month of December 2006, the visitor arrival figure was virtually flat, registering only a 0.6 percent increase.
According to GVB, Japanese travel agents are making internal efforts to sell Guam more aggressively. But the bureau said Guam must give more incentives to the travel agencies.
If Guam continues to struggle over the Japan market for structural reasons, GVB said it will need to devote more time to drive visitors from Korea and Taiwan.