St. George’s may have become a ghost town in recent months and years, with the fall in tourism and retail having a big impact on trade in the town.

Around one in seven businesses have closed down in Bermuda’s former capital over the past 18 months, down from about 70 to 60 as the global economic crisis struck.

But Kirby Brackstone, chairman of the East End Chamber of Commerce and co-owner of the Bermuda Perfumery, reckons the economy is suffering from a cyclical effect and St. George’s is due to bounce back soon from the hard times.

Mr. Brackstone said that the town is facing the same issues as the rest of the Island, but because the town relied so heavily on the tourist trade and retail sales in the past, it had been hit harder than most.

“There is this idea that St. George’s is dying and very often it is just taken in isolation and it is never in the broader context of the Bermuda economy,” he said.

“Tourism and retail have been suffering disproportionately over the last few years and they are two of the biggest things in St. George’s.”

Mr. Brackstone said that the majority of shops which had shut in the last year-and-a-half were satellites of company’s main stores in Hamilton and would always be affected first when management was required to make operational cost savings decisions. Gosling’s Ltd.’s St. George’s store closes its doors for the last time at the end of last year due to lack of business, particularly from tourists, having started its business in Water Street more than 200 years ago before moving to Hamilton, prior to setting up in the town again, this time at the site of The George & Dragon on the main square, and finally relocating to York Street.

Carole Holding Ltd. also made the decision to shut up shop in St. George’s, with its store on the main square closing in November 2008, mainly as a result of the number of cruise ships visiting the town being cut from two down to one.

Most recently Makin’ Waves closed earlier this year, due to a combined drop in sales and cruise ship arrivals, while The Carriage House has also shut for business indefinitely because of economic difficulties.

The Ample Hamper, based at St. George’s Club, will also be closing down at the end of this month, with a lack of customers cited as the main reason, while ER Aubrey is set to follow suit, and The Country Inn has been boarded up for almost four years now. Triminghams and Smith’s have been two of the biggest name departures from the town in past decade.

“I think a lot of the St. George’s issues really have to do with the underlying fundamental structural issues of retail and tourism,” said Mr. Brackstone.

“But that said, I don’t think it should be an excuse for retailers - it is up to us as business owners to change our business models to adapt to the changing circumstances we face.”

Mr. Brackstone believes that the tourism industry has been in decline for the past 20 to 25 years since international business took over as the main driver of Bermuda’s economy, with resources being diverted away from the former to the latter.

Allied to this, he said there had been a double whammy effect for St. George’s - first being hit with the closure of the US military base in the 1990s and then compounded by the drop-off in tourist trade. “We as businesses have not adapted as well as we could to all this - there are plenty of things we could be and indeed should be doing,” he said.

“For example, the Bermuda Perfumery is a niche company and we sell something that is unique to Bermuda that you can’t get in the US, so we have been advertising heavily towards tourists and we have got a lot of visitors as a result.

“It is about providing something that is hard to find anywhere else and I believe St. George’s is really conducive to that sort of environment, such as small art shops and retailers selling small European stuff that you might not be able to find in the US.

“Equally, the local market is our most readily available source - we have 60,000 of the wealthiest group of people in the world and we should be doing a lot more to go after that market and make what we offer enticing for them because Bermudians are sophisticated buyers who shop in places like London and New York and they will buy something if they think you are giving a good service.”

However Mr. Brackstone thinks that Bermuda’s retailers face their stiffest competition not among themselves, but rather from the big US stores like Walmart which have been slashing their prices and really pushing their online sales.

“I think the general concern among retailers in St. George’s is over the uncertainty about the future, particularly of the tourism sector - until last week we didn’t know if we were going to get a cruise ship for next year, but thankfully that has been settled,” he said.

But there is some reason to be upbeat about the future of the town, with a number of stores opening in recent weeks, including Conscious Vibes, a shop selling Fair Trade products, and a new fishmonger set to open in the middle of January.

And Mr. Brackstone is positive that along with the Economic Empowerment Zone, which is due to be rolled out to both ends of the Island over the next two years, and the backing of the Corporation of St. George’s, the town will be able to enjoy a regeneration with the Chamber doing a big clean up of the abandoned buildings on the high street and an improved ferry service link with Dockyard bringing in more trade.

“I think what we have to do as a community is to focus on making St. George’s as attractive as possible for individuals and companies to come and set up in business, but also to attract locals, as well as making sure tourists are aware of us,” he said.

“It is about diversifying by attracting small local service companies here, to cater for things such as the 800 or so employees who work at the airport, through providing services like a dry-cleaners and a gym.

“There is no reason why a small IT firm, for example, couldn’t set up here - and we have proved that you can do interesting and fun things with these empty buildings and to regenerate the neighbourhood.

“There is a lot of talk and good will, but at some point you just have to stop talking and get out there and do it - you have to remember that as bad as recessions are, they are also great times for businesses to get started and to take advantage of new opportunities.”

St. George’s will be holding a New Year’s family event at Fort St. Catherine featuring midnight swimming, Chinese lantern lighting, coconut bowling on the beach and a tug-of-war contest.