It's the end of the world as we know it.

That was the fear for local businesses once the human cost of the Al Qaeda blitz on America had sunk in.

But one year on meltdown has been avoided - even if the economy has been scarred.

The struggling retail sector appeared most vulnerable after September 11 with tourists staying away and locals watching the pennies as world war and recession loomed. Stores such as Dollar Savers, The Scottish Wool Shop, Smugglers Reef, Meyer Travel's Washington Mall office and the Harbourmaster's Reid Street branch were forced to shut.

However Chamber of Commerce Retail Visitor Division Chairman George Grundmuller said prompt Government action helped avoid disaster and kept things ticking until spring brought some relief.

"Government was quick to react with the Buy Bermuda campaign, an excellent move."

Shops cut prices and the community responded, said Mr. Grundmuller, as consumers realised the significance of local outlets and the choice they offered.

He said: "Retail employs around 4,800 people.

"There is hardly a household where someone doesn't work in retail, even if just at weekends.

"Christmas sales were down but without the campaign the situation would have been a lot worse."

Payroll tax relief also helped said Mr. Grundmuller. "We are extremely grateful to Mr. Cox and the Finance Ministry," he said.

Chairman of the Chamber of Commerce restaurant division Phil Barnett also said Bermuda escaped the expected battering after restaurants made drastic cutbacks.

He said: "If you planned to bring in foreign workers that was immediately thrown out the window. Staff lost through attrition were not replaced. Most of our members say it was the right decision but it could have been a lot worse. Half of our members could have closed because there wasn't enough business."

Higher end restaurants had been hit harder said Mr. Barnett while budget eateries actually picked up business. "There are the same amount of people going out but they are going to the less expensive restaurants."

This was because businesses were reigning back on budgets for taking out clients, said Mr. Barnett.

But if the initial storm has been weathered there is always the fear of more terrorist strikes while lower tourist numbers are an immediate problem. "There is a lot of uncertainty going into the anniversary. Our season goes beyond September."

Employers Council Executive Director Andrea Mowbray (pictured left) said things didn't change as much as predicted. She said: "It was supposed to be the day that changed the world but everyone bounced back quicker than expected but I don't what I thought would change."

Despite relying on tourism and international business Bermuda had not been anymore vulnerable to the economic fall out, said Ms Mowbray.

She said: "Because we're tied to the insurance that's helped us a lot. Insurance is booming in Bermuda. I don't think Bermuda has particularly suffered.

"If anything its done better than anywhere else." She said the recovery elsewhere had been quicker than expected. "I went to New York the week after and it was quiet but the next week it was picking up."

Travel has changed said Ms Mowbray. "It's more difficult and maybe it's given the airlines and excuse for poorer service.

"There's no food, there's no utensils. They were always slow, now they have an excuse to be slow."