western region at a glance final

Western Region at a Glance 2005 DEAR READER: It gives me great satisfaction to present Western Region at a Glance 2005. This booklet intends to provide basic socio-economic information for potential investors and entrepreneurs interested in our region. It is our open invitation for an in-depth look at the advantages of the Western Region. This publication acquaints the reader with our economy and people as it summarizes the economic, technological, and social advantages that make the Western Region an ideal center for industrial development and for commercial and service exchange. Western Region at a Glance 2005 should be a valuable reference as you decide to do business in our region. We hope that you take time to visit us and experience firsthand the quality of living and truly splendid sceneries of western Puerto Rico. Sincerely, Wanda L. González Girona, Esq. President Western Chamber of Commerce of PR

TABLE OF CONTENT

Page

GENERAL INFORMATION.............1

LOCATION.............................................1

CLIMATE...............................................1

GEOGRAPHY .........................................1

POPULATION .........................................1

INDUSTRIAL COMPOSITION ...................3

FINANCE ...............................................3

EXTERNAL TRADE ................................4

LABOR ..................................................4

INCOME / WAGES..................................6

ACCESSIBILITY .....................................6

UTILITIES..............................................8

QUALITY OF LIFE ..................................8

EDUCATION ..........................................9

COMMERCIAL REAL ESTATE...............10

INCENTIVES.........................................10

TAXES.................................................11

LEADING BUSINESSES.........................12

CONVENTIONS / TOURISM ...................13

Western Region at a Glance 2005

This booklet was prepared as a joint effort by the Western Chamber of Commerce of Puerto Rico and the Economic Development University Center of the University of Puerto Rico at Mayagüez under the Program to Promote the Participation of Community – Based Organizations in Local Economic Development sponsored by the Community Reinvestment Office of Doral Bank. If this work or part of it is used as reference, appropriate credit to the Economic Development University Center and the Western Chamber of Commerce of Puerto Rico will be appreciated. Inquiries, comments or recommendations to improve the utility of this booklet as a source of basic information for potential investors are also welcome.

You may contact:

Mrs. Brenda Gil

Executive Director Western Chamber of Commerce of PR

P.O. Box 9 Mayagüez, P.R. 00681-0009

Tel. (787) 832-3749 or (787) 832-3250 (787) 832-4287

Email: [email protected] http://www.ccopr.com

or

Jose I. Vega, Director Economic Development University Center

University of Puerto Rico Mayagüez Campus

P. O. Box 5884 Mayagüez, P.R. 00681-5884

Tel. (787) 834-2566 or (787) 833-4465 e-mail: [email protected]

http://www.uprm.edu/decasac/cde

May 2005


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GENERAL INFORMATION The Western Chamber of Commerce of Puerto Rico (WCCPR) is a non profit organization organized under the laws of the Commonwealth of Puerto Rico in 1962.

One of the main objectives of the organization is to promote the economic development of the western region of Puerto Rico by means of encouraging the tourist industry to transform this region into the second tourist destiny of the Island.

The WCCPR integrates merchants, professionals, industries and banking companies, covering 17 municipalities of the western region. These municipalities are Aguada, Aguadilla, Añasco, Moca, Rincón, Cabo Rojo, Lajas, Hormigueros, Maricao, Las Marías, Mayagüez, San Germán, Sabana Grande, Isabela, Guánica, Quebradillas, and San Sebastián.

LOCATION The location of the region with respect to Puerto Rico and of the individual municipalities within the region is depicted in the map shown below. The City of Mayagüez, which can be considered the central geographic point within the zone, is about 98 miles west or a 2 ½ hours drive from the capital city of San Juan in the Northeast. Municipalities comprising the Western Chamber of

Commerce of Puerto Rico region

CLIMATE The average yearly temperatures in the Western Region range from 75.5°F to 76.8°F as depicted in the next table. The mild subtropical climate varies little throughout the year. This

delightful climate is one of the reasons hundreds of thousands of tourists, mostly from the United States; visit the Island during the winter months from November through March. The annual rainfall ranged from 29.78 to 105.28 inches in 2000. Cabo Rojo, Lajas and Guánica are relatively dry while the more northwestern municipalities and the interior are very humid.

Western Region Average Temperatures 2000

Station Temperatures (°F) Mayagüez Municipality 77.8Lajas 77.2San Sebastián 77.2Magueyes Island (Lajas) 80.4Source: Climatological Data, Annual Summary, NOAA, US

Department of Commerce.

GEOGRAPHY The region has a territorial extension of around 574 square miles which represents around 17% of the total land area of the Island (3,426.5 square miles). The region is composed mainly of coastal plains and valleys rimmed by sloping hills and a mountain range to the interior. Costal municipalities include Quebradillas, Isabela, Aguadilla, Aguada, Rincón, Añasco, Mayagüez, Cabo Rojo, Lajas, and Guánica. Most of the available land is either mountainous with slopes greater than 35 degrees or classified as flood prone. Three main rivers in the western region feed the Bay of Mayagüez: Río Grande de Añasco, Río Yagüez and Río Güanajibo, others main rivers are: Río Guajataca, Río Culebrinas, Río Loco, and Río Guatemala. The water demands of the western coast municipalities is supplied by the Añasco, Yagüez and Culebrinas rivers together with the Guajataca Lake and Lajas Valley irrigation channels.

POPULATION The Western Region had a population of 594,295 persons in 2000. This figure represents 15.6% of the total population for the Commonwealth. Mayagüez has the largest population of the region, with 16.6 percent of the total population, or 98,434 inhabitants,


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according to the U.S. Census Bureau, Census 2000.

Population by Municipality Western Region

Municipality Population Estimate

2003

Population 2000

Population 1990

Aguada 43,579 42,042 35,911 Aguadilla 65,970 64,685 59,335 Añasco 29,110 28,348 25,234 Cabo Rojo 49,065 46,911 38,521 Guánٕica 22,347 21,888 19,984 Hormigueros 16,951 16,614 15,212 Isabela 45,748 44,444 39,147 Lajas 26,994 26,261 23,271 Las Marías 11,505 11,061 9,306 Maricao 6,506 6,449 6,206 Mayagüez 97,627 98,434 100,371 Moca 41,425 39,697 32,926 Quebradillas 26,468 25,450 21,425 Rincón 15,420 14,767 12,213 Sabana Grande 26,696 25,935 22,843

San Germán 37,611 37,105 34,962 San Sebastián 45,537 44,204 38,799 Western Region

608,559 594,295 535,666

Puerto Rico 3,900,000 3,808,610 3,522,037 Source: U. S. Department of Commerce, US Census Bureau 1990 &

2000. The population by sex is presented in the following table.

Population by Sex 2000

Municipality Population Male Female

Aguada 42,042 20,608 21,434 Aguadilla 64,685 31,717 32,968 Añasco 28,348 13,760 14,588 Cabo Rojo 46,911 22,614 24,297 Guánica 21,888 10,661 11,227 Hormigueros 16,614 7,802 8,812 Isabela 44,444 21,463 22,981 Lajas 26,261 12,818 13,443 Las Marías 11,061 5,419 5,642 Maricao 6,449 3,165 3,284

Mayagüez 98,434 47,243 51,191 Moca 39,697 19,477 20,220 Quebradillas 25,450 12,522 12,928 Rincón 14,767 7,189 7,578 Sabana Grande 25,935 12,445 13,490

San Germán 37,105 17,855 19,250 San Sebastián 44,204 21,593 22,611 Western Region 594,295 288,351 305,944

Puerto Rico 3,808,610 1,833,577 1,975,033 Source: U. S. Department of Commerce, US Census Bureau. The Western Region has a population density of 792.6 persons per square mile while several municipalities show densities higher than the average for the Commonwealth.

Municipality Land Area Square Mile

Person per square mile

Aguada 30.9 1,359.4 Aguadilla 36.6 1,767.8 Añasco 39.3 722 Cabo Rojo 70.4 667 Guánica 37.1 590 Hormigueros 11.3 1,467 Isabela 55.4 803 Lajas 60.1 437 Las Marías 46.3 239 Maricao 36.6 176 Mayagüez 77.6 1,268 Moca 50.3 789 Quebradillas 22.7 1,124 Rincón 14.3 1,034 Sabana Grande 35.9 723 San Germán 54.5 681 San Sebastián 70.5 627 Western Region 749.8 792.6 Puerto Rico 3,424.5 1,112.1

Source: U. S. Department of Commerce, Bureau of the Census, Census of Population 2000.

Census Population Growth by Municipality*

The municipalities with a higher growth in the Western Region according to the 2000 Census were Cabo Rojo, Rincón and Moca with a 20.01% - 25.00%. Mayagüez is the municipality that present a reduce growth according with the 2000 Census.


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Census Population Growth by Municipality*

2000

Source: Governmental Development Bank for Puerto Rico. Puerto Rico in Figures 2003. * According to the 2000 Census.

INDUSTRIAL COMPOSITION The distribution of industrial composition is shown on the next chart.

Construction8%

Wholesale/Retail Trade15%

Transportation and Warehousing

2%

Government21%

Services26%

Agriculture/Forestry/Fishing/

Hunting2%

Finance/Insurance

3%

Manufacturing/ Food/Apparel

17%

Lodging and food services

6%

Source: Industrial Composition by Municipality 2nd quarter 2004, PR Department of Labor and Human Resources.

Services (26%) are the leading employer followed by the government or public

administration (21%) and manufacturing (17%). Mayagüez is the hub for educational, health, and business services for the region. Important industries in the western region are computer and electronics industries, apparel and other textile, food manufacturing, and pharmaceuticals (included in the Miscellaneous and Chemical groups shown below). Total manufacturing employment for the region was estimated at 18,804 in the second quarter of 2004. The following chart depicts the percentage distribution of employment by major manufacturing sectors.

Food Mfng.16%

Computer & Electronic

30%

Fabricated Metal7%

Nonmetallic Mineral

7%

Apparel22%

Printing & Related

2%

Chemical3%

Miscellaneous7%

Furniture & Related

3%

Beverage & Tobacco

3%

Source: Industrial Composition by Municipality 2nd quarter 2004, PR Department of Labor and Human Resources. Based on 2002

NAICS Codes and Titles. For detailed description of each category visit http://www.census.gov/epcd/naics02/ naicod02.htm

FINANCE Puerto Rico has sixteen (16) banks with over 500 operating branches and total assets of approximately $150 billion. These banks provide the financial services that sustain all the industrial and commercial activity on the Island.

Puerto Rico’s Financial System Total Assets as of June 30, 2003 Million Dollars:

Source: Governmental Development Bank for Puerto Rico. Puerto Rico in Figures 2003.


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EXTERNAL TRADE Puerto Rico has an open economy exporting and importing more than $85 billion worth of goods every year. The following chart represents the Recorded Merchandise Trade:


Puerto Rico has exports of $55.2 billions during the 2003 and imports of $33.7 billions.

The next diagram represents the Economic

Openness 2003:


Puerto Rico has an economic openness of 132.8%. The following chart corresponds to the Economic Classification of Adjusted Merchandise Imports:


During the 2003, Puerto Rico imports more of the raw materials ($29.9 billions) and petroleum products ($7.3 billions) needed for production and consumption. The subsequent diagram represents the Industrial Classification Recorded Merchandise Exports:


In this diagram the chemicals represent the merchandise with the major quantity of billions during 2003. The apparel & textiles signify the less than $10 billion.

LABOR In 2004 the civilian labor force in the Western Region totaled 202,800 with employment of 156,700 and an unemployment


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rate of 15.36%. The unemployment rate for the Commonwealth for that same period stood at 12.3%. In general, it is a well educated labor force evenly split between among sexes. Puerto Ricans have been citizens of the United States since 1917 and most speak English. University graduates are generally bilingual.

There is an ample labor pool as unemployment rates fluctuate among 11% to 21% depending on the Municipality.

Unemployment Rates by Municipality

Municipality 2004 2003 2002 2001

Aguada 13.4 14.4 16.2 18.2 Aguadilla 14.5 16.2 17.3 16.7 Añasco 15.6 16.8 18.0 17.0 Cabo Rojo 11.2 11.9 12.3 11.4 Guánica 21.2 23.7 23.9 21.3 Hormigueros 10.9 11.4 11.3 10.8 Isabela 17.8 19.6 20.3 21.8 Lajas 15.7 14.2 15.1 16.7 Las Marías 18.5 21.7 22.9 26.9 Maricao 13.4 15.7 16.7 19.9 Mayagüez 12.6 14.8 15.8 14.7 Moca 15.5 16.7 18.6 18.7 Quebradillas 15.9 19.2 28.7 15.0 Rincón 15.6 13.4 15.3 14.8 Sabana Grande 14.0 14.8 15.2 13.8

San Germán 15.6 14.8 15.2 15.5 San Sebastián 19.7 22.5 25.2 20.2 Western Region

15.36 18.01 19.02 16.57

Puerto Rico 11.3 12.3 12.3 11.4 Source: PR Department of Labor & Human Resources Labor Mobility:

According to the US Census Bureau 2000, the mobility labor in the Western Region concentrates on larger cities. In the region the mobility labor is higher at Mayagüez and Aguadilla. Some factors for this mobility are: a higher concentration of industries, higher economic development, geographical proximity or easy access to main roads. The percentage of labor force of each municipality that comes from other municipalities within the region is shown on the following table.

Mayagüez 41%Aguadilla 39%Hormigueros 38%San Germán 35%Maricao 34%Añasco 32%Rincón 27%Moca 25%Sabana Grande 21%Lajas 20%Aguada 18%Isabela 16%San Sebastián 15%Cabo Rojo 15%Las Marías 13%Guánica 13%Quebradillas 10%

This chart represent the Employment Status Persons Age 16 and Over:


This graph presents us the percent of persons who are unemployment, employed and inactive.

The next diagram represents the

Employment Rate:



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INCOME / WAGES According to the 2000 Census of

Population, the Western Region had an average family income of $13,763 versus that of the Island, which was $16,543. During the same year 80,478 families were below the poverty level, which represents 51.5% of the total families in the Region.

Hourly wages by occupation for selected occupational groups in Puerto Rico are presented below.

Employment and Wages by Major Occupational Group

Occupation Employment Hourly Wage (median)

Management 37,690 $22.47 Business and

financial 33,050 12.67

Computer and mathematical 6,240 15.33

Architecture and engineering 12,300 16.07

Healthcare practitioners and

technical 39,090 8.94

Community and social services 14,240 9.10

Legal 4,440 18.48 Sales and related 98,070 6.60

Office and administrative

support 184,670 7.47

Production 96,650 7.12 Source: Occupational Employment Statistics 2001, Department of Labor

and Human Resources.

ACCESSIBILITY

Highways: The main land transportation route leading to Western Region is Road PR-2. This highway connects all major coastal urban centers throughout the Island including Ponce in the south and San Juan in the northeast. Driving time from Mayagüez to the Capital city of San Juan ranges from 2 to 2 1/2 hours and from 45 minutes to 1 hour to Ponce. Road PR-2, with several secondary state roads, places the many natural attractions of nearby municipalities such

as bathing and surfing beaches and lush state parks within an hour drive from Mayagüez.

Airports:

There are two airports in the Western Region: 1) Eugenio María de Hostos, in Mayagüez, and 2) Rafael Hernández, at Punta Borinquen in Aguadilla. Eugenio María de Hostos Airport services commercial and privately owned aircraft. According to Ports Authority statistics 54,821 passengers traveled through the Eugenio María de Hostos Airport in 2003. Service is provided to San Juan with two daily flights. Charter planes flights and rental car are available by previous arrangements. You may reach the Mayagüez airport administration at (787) 833-0148. Rafael Hernandez Airport with a landing strip of 11,700 feet was built as a bomber airbase just before WW II. It is located at the former Ramey Air Force Base, and is equipped with hangars and parking aprons. Because of its size and availability of large storage facilities, the trend for the Rafael Hernandez Airport is to specialize in cargo handling. According to Ports Authority statistics 105,347 passengers traveled through the Rafael Hernandez Airport in 2003. It nevertheless, provides daily passenger flights to Newark and New York. Also is the second airport on the Island in terms of cargo. You may reach the Aguadilla airport administration at (787) 890-0101. Both airports are administered by the Puerto Rico Ports Authority, a Commonwealth corporation. The Puerto Rico Ports Authority web site is http://apprportal.prpa.gobierno.pr

Luis Muñoz-Marín Intl. Airport is one of the most important airports in Puerto Rico. This airport receives thousands of passengers from different places to our island. In 2003 the quantity of passengers traveled was 9,507.3 thousands. If we compare the 2003 with the 2002, we can detect the highly increase between this two years (aprox. 458.1)


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The next chart presents the movement of passenger on this airport, and permit us compare this statistics between years.

Passenger Movement

Luis Muñoz-Marín Intl. Airport (Thousands)


Seaport: Mayagüez is the third largest commercial port in the Island and is an open roadstead located midpoint on the west coast. The bay is easily entered day or night and is a good harbor in any weather, except during a hurricane. The harbor is 3.8 miles wide and it is protected by reefs which extend across the harbor entrance in a general north by west direction. The principal channel is about .4 mile wide, with depths at the entrance of about 47 to 120 feet, marked by lighted buoys. Depth in the inner channel is approximately 30 feet and close alongside the pier from 28 to 29 feet. The Puerto Rico Ports Authority operates the terminal facilities which consist of a bulkhead wharf approximately 1,200 feet long, apron width 30 feet, and transits sheds and open storage area. There are other berthing facilities in the port which are owned or operated exclusively by a tuna packing plant. Pilot services are available day and night. For Customs service, Mayagüez is under the jurisdiction of the Mayagüez Customhouse of the United States Federal Customs System. You may reach the Port Captain at (787) 832-3590 or (787) 831-5144.

This graph represents the Cruise Ship Visitors:

Source: Governmental Development Bank for Puerto Rico. Puerto Rico in Figures 2003. Transportation: Several freight companies provide ground cargo transportation connecting all major cities, port and airports within the Island. Overnight pick-up and delivery services are available to most cities within the Commonwealth and the Continental U. S. International delivery is also available to most foreign countries. UPS, Federal Express, and the US Postal Service, coupled with several local suppliers provide a wide variety of services. For information contact the local phone directory. Taxi Services: Several companies provide taxi service within the area. These are:

Mega Taxi Aguadilla (787) 819-1235 City Taxi (787) 265-1992 Taxi Westernbank (787) 832-0562 Mr. Special Taxi (787) 832-1115

This chart represents the growth or reduction in the transportation prices:



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UTILITIES

Electricity: Puerto Rico Electric Power Authority (PREPA) is the provider of electricity in Puerto Rico. It relies wholly on an integrated system consisting of thermoelectric generators, gas turbines, hydroelectric plants and transmission lines to produce and distribute power throughout the island. The largest unit’s capacity is 450 megawatts, and except for the hydroelectric plants, the generators and turbines run on oil. Of all the regions comprising Puerto Rico’s electrical power system the Western Region is the only one lacking a principal generation source after the construction various years ago of the Cambalache Plant in Arecibo in the North. The nearest generating plant is the EcoEléctrica located in Punta Guayanilla, Peñuelas. It includes a Liquefied Natural Gas (LNG) terminal, a power plant and a water desalination plant. EcoEléctrica production represents about 15% of the total power generation on the island. For more information contact the PREPA regional office at (787) 834-6363 or visit http://www.aeepr.com.

Water and Sewer: The Puerto Rico Aqueducts and Sewer Authority (PRASA) owns and operates the public water and wastewater systems. Over 94% of the island’s population is served by the water system, which is made up of 105 filtration plants, 42 surface systems, 965 pumping stations, over 965 reserve tanks, 395 underground wells, and 210 aqueduct systems which distribute water throughout the municipalities with over 18,000 kilometers of pipes and tubing. The wastewater system, is linked by over 14,000 kilometers of sanitary pipes to 519 sanitary pumping stations and 74 treatment plants, which perform grit removal, biological treatment, primary and secondary clarification, and chlorination. For more information, contact the PRASA regional office at (787) 831-6406 or 831-6440 or visit http://www.acueductospr.com.

Telecommunications Telephone:

The telecommunications industry in Puerto Rico is in a transitional phase and experiencing rapid growth as a result of a growing demand for services. The Western Region is no exception to this trend as the Puerto Rico Telephone Company and private companies such as Centennial, MCI, Sprint, Cingular Wireless, Verizon Wireless, Cel Page, AT & T and many others rally to obtain a share of the huge and growing market for personal pagers, local and international phone calls, cellular phones and other wireless communication services, internet access and many other related services. For more information about the PR Telephone Company, contact the regional commercial office at (787) 806-0788 or visit the webpage www.telefonicapr.com.

QUALITY OF LIFE Entertainment and Culture: Mayagüez has a first-rated zoo, several public parks, the historic Yagüez Performing Arts Theater and the Municipal Cultural Center as attractions. Also the Western Region has beaches, excellent seafood dining and some outstanding natural reserves, among them the Forest Reserve in Maricao and a Dry Forest in Guánica. The Holiday Inn and Best Western hotels in Mayagüez have both, a night club and a casino. In the Western Region there are myriad of pubs patronized mostly by university students. Also you may enjoy bird watching, hiking, the Bioluminescent Bay at Lajas, among many other natural wonders. A very popular celebration is the “Fiestas Patronales” which is a festivity in honor of the local patron saint. There are also many other festivals and artistic shows during the year complemented by cultural activities for the general public.

Sports: Two golf courses Club Deportivo del Oeste at Cabo Rojo and Punta Borinquen Golf Club at Aguadilla are available for public use. Among others sports you may enjoy are swimming, snorkeling or diving, kayaking,


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surfing, windsurfing, deep sea-fishing charters, jets sky, boat rides and sport fishing, etc. The next diagram represents the growth or reduction in the education and recreation prices:


Health Care: Mayagüez is the hub for health services for the western region with six private hospitals. In the heart of town is the San Antonio Hospital and very nearby is the Hospital Perea, both private hospitals. At Cerro Las Mesas, there is the Bella Vista Hospital (sponsored by the Adventist Church) and on road PR-106, the Clínica Española. The Dr. Ramón Emeterio Betánces Hospital has a Cardiovascular Clinic. An outpatient Veterans Administration facility is located on road PR-2. In San German has La Concepción Hospital located in Road PR-2. This hospital inaugurated its new facilities in February 2004. Mayagüez has the greatest health services concentration, with 63% of the total beds in hospitals within the western region as depicted in the following table:

Distribution of Beds in Hospitals

of the Western Region

Municipality Public Private Total Mayagüez 0 901 901 San Germán 42 167 209 Aguadilla 0 153 153 Moca 122 0 122 Cabo Rojo 0 62 62 Isabela 19 0 19 San Sebastián 0 19 19 Sabana Grande 17 0 17 Añasco 14 0 14 Hormigueros 0 14 14

Lajas 0 13 13 Las Marías 11 0 11 Quebradillas 0 11 11 Rincón 0 9 9 Aguada 0 9 9 Maricao 0 8 8 Guánica 8 0 8 Total 1,599 Source: Compiled by EDUC from data supplied by the Hospitals.

The number of beds included cradles for babies. The next diagram represents the growth or reduction in the medical care prices:


EDUCATION

Primary and Secondary: The Public Board of Education has established several elementary, junior high schools and high schools throughout the city and the rural areas. A vocational school and a special high school for outstanding students from all around the Island are both located in Mayagüez. In and around town there are several private schools that cover all levels of education, and also at some of these the curriculum is totally in english. Colleges and Universities: Mayagüez is home for three university campuses, the University of Puerto Rico Campus at Mayagüez (UPRM-UPR) the one with the greatest economic impact on the region, with an enrollment of 11,877 students. The city is host also to campuses of the Catholic University (PUC) and the Antillean Adventist University affiliated to the Adventist Church. Nearby San German have a campus of the Inter American University (IU), with an enrollment of 11,994. The PUC, UI and UPRM offer Master’s degrees in various


10

disciplines. The UPRM comprises the colleges of agricultural sciences, arts and sciences, business administration, engineering and the extension division as well as important research centers. Mayagüez also hosts the Eugenio Maria de Hostos School of Law which was established in 1994.

Largest Western Region Colleges and

Universities

Enrollment Inter American University San

German Campus 5,639

UPR Campus at Mayagüez 11,456Inter American University

Aguadilla Campus 4,266

UPR Campus at Aguadilla 3,151Pontifical Catholic University of

Puerto Rico Mayagüez Campus 1,746

Metropolitan University at Aguadilla 1,815Universidad del Este Cabo Rojo 803Antillean Adventist University 744Centro Universitario de Isabela 12,000Eugenio María de Hostos

School of Law 310

ICPR Junior College 500

Source: Institutions academic year 2004-2005. UPR stands for University of Puerto Rico

COMMERCIAL REAL ESTATE

There is several local real estate companies specialized in residential and commercial transactions. For a listing you may reach the Western Chamber of Commerce. Industrial space is leased according to building size and location in various industrial parks throughout the municipality. Industrial buildings available range from 9,000 square feet to 50,000 square feet. For information contact the Puerto Rico Industrial Development Company (PRIDCO), regional office at (787) 832-4512 or www.pridco.com. There are several public warehouses strategically located near the airport, the port and main access routes in the Alturas de Mayagüez Warehouse complex. Space available ranges from 4,992 to 27,456 square feet. For more information contact Mr. Hernán Gaztambide of the Commerce and

Export Development Corporation at (787) 833-0245. For information about space available for small businesses contact the Commerce and Export Development Corporation, Mayagüez Office at 832-0537 or the web site www.fomentocomercialpr.com.

INCENTIVES Commonwealth Incentives: The Commerce & Development Economic Incentives Law approved on September 2, 1997 contains a series of liberal tax provisions aimed at stimulating the local industrial development and commerce through the concession of tax exemption and other significant benefits. The Law concentrates practically on attracting new industrial investment to Puerto Rico. It is an improved version of the 1987 Incentives Law which eliminates the existing tollgate tax for new businesses and establishes a flat tax for existing concerns. The flat tax offers an effective corporate tax rate below the existing one for manufacturing or export-oriented companies. While not automatic, it is also available for expansion of existing businesses. New incentives offers a 200% tax deduction on research and development (R&D), investment as well as on training expenses, and 2-0 % special corporate tax rate for “Pioneer Industries”. The Law has several other important provisions. Contact the Puerto Rico Industrial Development Company at (787) 764-6966 for more specific information or visit the website at www.pridco.com. Tourism Development Act The 1993 Tourist Development Act offers investment incentives for the development and expansion of tourist facilities. Some of the provisions of the Act include: tax credit equal to 50% of total cash equity up to 10% of the total cost of project, 90% income tax exemption for the ten years, 100% in Vieques and Culebra, 90% municipal property tax exemption among others; and the creation of the Puerto Rico Development Fund to guarantee development loans. Two new


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incentives were introduced in 2001 thus facilitating financing and development of new tourism projects. The first one provides a 100% income tax exemption to association of legal owners of vacation clubs, hence promoting the development of the time-share industry of Puerto Rico. The second one provides tax exemption to 100% of the incomes received from fees charged by financial institutions for issuing guarantees or letters of credit to finance tourism development projects. For more specific information contact the PR Tourism Company or visit their website at www.gotopuertorico.com/AboutPRTC. Local Incentives & Programs (Municipal): Each municipality has its own local business incentives and programs. For more specific information contact the municipality of your interest.

TAXES Sales Taxes: The local businesses in Puerto Rico are not required to file US Federal income tax returns and are taxed instead by the Commonwealth. Taxes on purchases are built into the price of goods, which often includes a 6.6% excise tax on merchandise brought in from the Continental US and elsewhere. Hotel/Motel Occupancy tax: In Puerto Rico, the room occupancy tax rate of the hotels with casinos is 11%, for those without casinos are 9% and for Paradores (Country Inns) is 7%. Personal and Corporate Income Taxes: The tax reform, adopted in Puerto Rico during 1994, brought about radical changes in the tax rates applicable to individuals, corporations and partnerships. The individual tax rates range from 7% to a maximum of 33% depending of the level of family income. The corporate and partnership tax rates stand at 20% for normal contribution. Property Taxes:

Personal property taxes generally apply to the cost of the inventories (computed on the basis of monthly average), machinery and equipment, furniture, fixtures, cash on hand, investment by corporations organized under the laws of Puerto Rico in foreign corporations and certain other items. Accounts and notes receivables, intangible property, cash in banks, raw materials and goods in the manufacturing process are tax exempt. Personal property tax rates are determined by each municipality and may vary somewhat from one to another within the maximum rate fixed by law. Real property taxes are also determined by each municipality within the maximum rate fixed by law and are levied upon the property valued assessed for tax purposes. Municipal License Tax: Municipalities are authorized to levy a municipal license (patente) tax on the gross volume of business generated within the municipality. The current rate for the municipalities in the Western Region is shown in the next table. The municipal assemblies are authorized to levy lower rates, provided that said rates are uniformly applied.

Municipalities Financial Businesses Other Business

Aguada 1.50% $1 – $5,000 ( tax exempt) $5,001 – $8,334 ($25)

$8,335 –$100,000 (30%)

$100,001 –$200,000 (40%)

$200,001 or more (.50%) Aguadilla 1.50% 0.40% Añasco 1.50% 0.50% Cabo Rojo 1.50% 0.50% Guánica 1.50% 0.40% Hormigueros 1.50% 0.50% Isabela 1.50% $1 – $100,000 (.30%)

$100,001 – $200,000 (.40%)

$200,001 or more (.50%) Lajas 1.50% 0.50% Las Marías 1.00% 0.30% Maricao 1.50% 0.30% Mayagüez 1.50% 0.50% Moca 1.50% 0.50%

Quebradillas 1.50% $1 – $100,000 (.30%)

$100,001 – $200,000 (.40%)


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$200,000 or more (.50%)

Rincón 1.50% 0.50% Sabana Grande

1.50% 0.50%

San Germán 1.50% 0.50%

San Sebastián 1.50% 0 – $5,000 (tax exempt) $5,001-$500,000 (.40%)

$500,001 or more (.50%) Source: Information provided by “Oficina del Comisionado de

Asuntos Municipales” (OCAM). Payroll Taxes: Under the unemployment security law of the Commonwealth, every employer is required to pay a state tax of 5.4% on salaries. The federal social security tax and Medicare, which is also required to be paid by every employer, is based on 7.65%. A similar amount is required to be paid by the employee and withheld at source from the employee’s salary by the employer. Every employer is required to obtain a workmen’s compensation insurance policy from the State Insurance Fund in order to cover any accident that may occur at work. The Bureau of Social Security for Chauffeurs and other Employees requires every employer to pay .30¢ per week and each employee that drives a vehicle as a work related task to pay .50¢ weekly.

LEADING BUSINESSES Local businesses: According to the 2002 County Business Patterns publication of the Bureau of the Census there are 5,862 business establishments in the Western Region. Some of them like the ones listed below are native to the Region:

Productos La Aguadillana, Inc. Hojaldre Añasqueña Sanz Tropical Bel-Air Industries of PR, Inc. 3-A Press Corp. Cervecería India Westernbank Empresas Bechara Supermercados Mr. Special Refrescos del Oeste, Inc. Productos Ricura Inc. Franco & Co., Inc. La Gloria, Inc.

Fortune 500 Companies: According to Puerto Rico Industrial Development Company (PRIDCO), 178 of the Fortune 500 Companies operate in Puerto Rico. The Western Region is home to several of these companies. Some of these are:

Bristol – Myers Squibb Caribbean Company Eli Lilly Industries, Inc. Hewlett-Packard Puerto Rico Co. Lifescan PR, Inc. (Johnson & Johnson) Baxter Healthcare Corporation de PR GE Thermometrics OMJ Pharmaceuticals Inc. (Johnson &

Johnson)

National Franchises and Chains Stores: Practical every major franchise in the United States is doing business in Puerto Rico. In the Western Region some of them are:

JCPenney McDonalds Wal Mart Burger King Kmart Pizza Hut Walgreens Ponderosa Sears Roebuck Marshalls

Financial Institutions: Ten commercial banks have

operations in Western Region. These include:

Banco Bilbao Vizcaya www.bbvapr.comBanco Popular www.bancopopular.comBanco Santander www.santanderpr.comCitibank www.citibank.comDoral Bank www.doralbank.comFirstbank www.firstbank.comEuro Bank www.eurobankpr.comOriental Bank and Trust www.orientalonline.comR-G Premier Bank ww.rgpremierbank.comScotiabank www.scotiabankpr.comWesternbank www.wbpr.com

Commercial banks offer industrial,

commercial, real estate, personal and agricultural short and medium term loans. Their lending activity is not limited merely to loans, but includes bank acceptances, lines of credit and letters of credit. For telephone


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numbers and more information about branches refer to the local phone directory.

CONVENTIONS / TOURISM

Hotels: There are several hotels within the Western Region that cater to business and leisure travelers. Room rates vary significantly when comparing smaller hotels located in the downtown area to the ones with casinos located in the suburbs. There are also several beachfront lodging facilities in Cabo Rojo, Isabela, Guánica, Lajas and Rincón. For detailed rates information contact the Hotels directly. A list of some hotels, paradores and guest houses is included below. Hotel Telephone Rooms Parador JB Hidden Village (787)868-8686 33 Hotel El Faro (787)882-8000 75 Hotel Cielo Mar (787) 882-5959 52 Boquerón Beach Hotel (787) 851-7110 94 Lighthouse Tropical Inn (787) 255-3887 60 Copa Marina Beach Resort (787)821-0505 106 Costa Dorada Beach Resort (787) 872-7255 52 Villa Montaña Beach Resort (787) 872-9554 52 Parador Villa Parguera (787) 899-7777 74 Parador Hacienda Juanita (787) 838-2550 21 Best Western Mayagüez Resort and Casino (787) 831-7575 140 Holiday Inn Tropical Casino (787) 833-1100 149 Hotel Mayagüez Plaza (787) 832-9191 35 Hotel Colonial (787) 833-2150 29 Hotel El Sol (787) 834-0303 51 Parador El Guajataca (787) 895-3070 38 Parador Villa Antonio (787) 823-2645 61 Hotel Villa Cofresí (787) 823-2450 80 Horned Dorset Primavera (787) 823-4030 52 Rincon of the Seas Grand Caribbean (787)823-7500 116 Rincon Beach Resort (787) 589-9000 118 Hotel Oasis (787) 892-1175 52

The next graph represents the Occupancy Rate in Tourist Hotels:


During 2003 the occupancy rate was 68.0 percent, if compares this year with 2002 we can observe a growth of 3.6 percent. Meeting Facilities: The Best Western, Holiday Inn, Rincon Beach Resort, Copamarina Beach Resort, Costa Dorada Beach Resort and Rincon of the Seas have meeting facilities to accommodate groups of over one hundred persons. The other hotels and area restaurants have facilities to cater smaller groups. Contact the hotels’ sales department for more information. Attractions: One of the most impressive scenic routes in Puerto Rico is located at the Western Region. Named PORTA DEL SOL, it includes the coastal municipalities from Isabela to Guánica. In Porta Del Sol you will find some of the world’s greatest surfing areas and beautiful beaches including Boquerón, Combate and Buyé in Cabo Rojo, Jobos in Isabela and Crash Boat in Aguadilla, among others. Fifty miles west of Mayagüez is rugged Mona Island, a nature reserve. Yard-long iguanas co-exist with colonies of sea birds. Colorful fish swim around coral reefs set in extremely clear waters. Cliffs up to 200 feet high, pierced with caves, ascend to a tabletop plateau covered with low, dry forest, and white sand forming dazzling beaches. Another attraction is the Guánica Dry Forest, the largest remaining tract of tropical dry coastal forest in the world and a United Nations Biosphere Reserve. Its forest along the coast and on low-lying hills hosts the greatest number of bird


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species on the Island. In Lajas, the fishing village of La Parguera has developed into a popular resort center while maintaining much of its small town atmosphere. In the evening, boats leave regularly for nearby Phosphorescent Bay where billions of luminescent dinoflagellates light up when disturbed by movement. The same is true also for the fishing village of Boquerón in Cabo Rojo, which has one of the best protected bays on the Island, a favorite among pirates and buccaneers of the fifteen century and now a major hub for nautical tourism. For additional information or attractions in the western region contact the P.R. Tourism Company office in Cabo Rojo (787) 851-7015 or in Aguadilla (787) 890-3315 or 1-800-981-7575. Ask for a copy of the Qué Pasa magazine, official guide to Puerto Rico published by the Tourism Company. For additional information about PORTA DEL SOL visit http://www.gotoportadelsol.com

WESTERN REGION IN DETAIL Research & Information Resources: For more detailed information on the Western Region, contact the Western Chamber of Commerce of Puerto Rico at (787) 832-3749 or (787) 832-3250. Useful Web Sites:

Puerto Rico University Mayagüez Campus www.uprm.edu

Pontifical Catholic University of Puerto Rico www.pucpr.edu

Inter American University of PR

www.inter.edu

Eugenio María de Hostos School of Law www.hostos.edu

Antillean Adventist University www.uaa.edu

Universidad del Este www.suagm.edu

Puerto Rico Planning Board Census Office www.censo.gobierno.pr

Puerto Rico Health Department www.salud.gov.pr

U.S. Census Bureau www.census.gov

Puerto Rico Agricultural Statistic Service www.nass.usda.gov/pr/esp_index.htm

Tendenciaspr.com www.tendenciapr.com

PR Tourism Company www.gotopuertorico.com

Puerto Rico Industrial Development Company (PRIDCO)

www.pridco.com Commonwealth of Puerto Rico

www.gobierno.pr Municipalities

www.gobierno.pr/GPRPortal/StandAlone/MunicipalitiesMap.aspx

Puerto Rico TechnoEconomic Corridor (PRTEC) www.prteconline.com

Technology Business Accelerator (VITEC2) www.vitec2.com

Hospital Perea www.paviahealth.com

western region at a glance final

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