Guam as a regional trade ‘fulfillment’ center?

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Senator James Moylan (file photo)

A bill has been filed that would make Guam a processing trade, distribution, and fulfillment center in the region.

According to Sen. James Moylan, the sponsor of Bill 218-35 (COR), Guam’s proximity to Asia makes the island an ideal destination for industries such as a processing trade and distribution, transformation or fulfillment center.

Not only would businesses in those industries be beneficial in stimulating the island’s economy, but they would also help create more jobs for the island.

Under the bill, processing trade companies would essentially import materials with the intent of assembling or transforming them locally, with at least 50 percent of the work done on Guam, and then exporting them to buyers off-island, with the attraction of labeling the goods as “Made in Guam, USA” as the enticing factor.

As for distribution, transformation, or fulfillment centers, Moylan says Guam’s proximity to the Asian region benefits potential tariffs and timelines, thus allowing the goods to be imported, stored, processed and shipped from Guam.

However, the costs of labor or logistics may be a concern for potential investors. Thus, Moylan said there is a need to create viable incentives to attract these types of industries to Guam. He said the Qualifying Certificate program offered by the Guam Economic Development Authority (GEDA) is an ideal tool that can be offered to potential investors.

Under the bill, a distribution, transformation or fulfillment center is described as a warehouse or specialized building which is stocked with products to be redistributed to consumers off-island, and shall be the processing function of the order completion structure. They shall also be able to provide services such as product mixing, cross-docking, and packaging.

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