The arrival of American troops in Zamboanga City did not spell brisk sales for many shops, contrary to expectations.

Private entrepreneurs set up souvenir shops. Restaurants offered American menus. Owners renovated their night clubs for the American soldiers.

Many started to lose money. U.S. troops have been restricted inside military camps here because of threats of attacks by the Abu Sayyaf, or other Muslim residents sympathetic to the group's fight for the establishment of a strict Islamic state in Mindanao.

"I loaned money from the banks. I bought souvenir items, thinking the Yankees would be interested in our culture. Business turned out bad because the U.S. soldiers remain confined to barracks," said Juanita de la Cruz, the owner of a souvenir shop in Basilan.

"The threats are always there. The risk of attacks by lawless groups against the U.S. troops is always there," said Covarrubias, adding the American soldiers occasionally go out to shop but under tight security. The U.S. soldiers could spend their rest and recreation in Mactan island in Cebu, central Philippines, a major tourist destination.

The presence of journalists in Zamboanga City has been good for the hotel and tourism industry. Many first class hotels here have all their rooms fully booked since January. Some hotels even increased their room rates 100 per cent, while others charge their guests in dollars.

Many hotel owners also sell souvenir T-shirts with markings 'I love USA'. In downtown Zamboanga, Moslem traders set up small foreign exchange shops, offering black market rates.

"It is quite okay. Business is good nowadays and many people come here to exchange their dollars. We buy U.S. dollar at P51.00," said stall owner Haji Usman Sahali.