5,000 Boxes and a Broken System

In April 2025, Guam's Office of Public Accountability set out to answer a simple question: how much alcohol is being imported through our ports? The auditors couldn't answer it. The data exists — scrawled on invoices stuffed into more than 5,000 cardboard boxes in a warehouse in Tiyan.¹

The Customs and Quarantine Agency still operates entirely on paper. Every manifest, invoice, and packing list gets filed by hand into boxes stored in a facility vulnerable to typhoons, humidity, and pests — where two fires in 2016 already destroyed customs documents with no digital backup.² The procedures governing this process haven't been updated since 2003.¹ When auditors needed records, CQA had to pull sixteen officers off regular duties to dig through boxes for weeks.¹ OPA has flagged the same problem in five reports across a decade.³

This time, the numbers made the cost concrete. For October 2021, invoices suggested imported distilled spirits should have generated roughly $128,844 in excise taxes. But DRT collected approximately $44,277 the following month — covering fewer than half the estimated gallons.¹ There could be legitimate explanations: bonded warehouses, military exemptions, re-exports. The problem is that no system exists to check. Wholesalers self-report their import volumes and calculate their own excise tax each month.⁴ Without an independent record of what arrived at the port, the gap between what's imported and what's taxed is invisible — and invisible gaps don't get investigated.

OPA recommended updating SOPs, requiring the electronic manifests already mandated by law, establishing public reporting, and creating a CQA-DRT reconciliation procedure. CQA Director Ike Q. Peredo concurred with every finding and submitted a corrective action plan.¹

But concurrence is not implementation.

Why the Fix Is Taking So Long

The correct long-term solution is ASYCUDA — the UN's Automated System for Customs Data, used by over 100 countries, including every other customs agency in Micronesia.⁵ Countries implementing it have seen revenue increases of 10 to 50 percent.⁶ The system costs approximately $2 million.⁷ Public Auditor Benjamin J.F. Cruz has estimated Guam loses approximately $150 million per year in total customs-related revenue under the current system.⁷

Yet Guam has been trying to procure ASYCUDA for five years. The most revealing reason is structural: no single office has been designated as the project owner. CQA is the end user; the Bureau of Statistics and Plans managed the UNCTAD relationship; the Department of Administration processes procurement; the Attorney General reviews the contract; the Legislature passes enabling laws.⁸ Everyone has a piece. No one owns the whole.

That fragmented ownership enabled a cascade of delays. Guam is outside the U.S. customs territory, so it can't use the federal system.⁹ Adopting the UN alternative required State Department approval.⁷ That came in 2021, but then funding fell through — American Rescue Plan dollars couldn't be obligated in time.⁷ CQA didn't receive implementation funding until August 2025.⁸ A contract was submitted to the Attorney General in October 2024; its status remains unclear.¹ A March 2026 GAO report documented broader procurement dysfunction, with purchase requests sitting for months.⁸

Even after the contract is signed, CQA estimates 24 to 36 months for deployment.⁷ The earliest realistic date for a fully operational system is 2028 or 2029.

Why Guam Can't Wait — and Doesn't Have To

ASYCUDA remains the right long-term platform. But Guam cannot keep losing $150 million per year while waiting for a procurement process that has stalled repeatedly.

A lightweight interim system — a web-based tool for electronic data capture and reporting — could be built in approximately four months at an estimated cost of $300,000 to $400,000.¹⁰ It would not replace ASYCUDA. It would solve the specific problems OPA identified: capture electronic cargo records, track alcohol volumes by type and importer, generate monthly reconciliation reports for DRT, and store documents in a searchable database instead of cardboard boxes.

Designed with ASYCUDA compatibility, the interim system creates a bridge, not a dead end. When ASYCUDA goes live, its AI and machine learning modules need historical data to function effectively.¹¹ Data captured now gives ASYCUDA a running start instead of a cold start. The two don't compete — the interim system accelerates ASYCUDA. And if procurement stalls again, the bridge system ensures Guam isn't left with nothing.

Commissioning this does not require a new law. The Governor could direct CQA to procure it under existing authority, or the Legislature could appropriate funds with a binding timeline.

The Math That Matters

An interim system costs an estimated $300,000 to $400,000. ASYCUDA costs $2 million. The estimated annual revenue loss is $150 million.⁷ Even if the interim system recovers just 1 percent of estimated losses, it pays for itself several times over in its first year. Public Auditor Cruz told this newspaper that the revenue lost over the past decade could have paid for ASYCUDA ten times over.⁷

CQA's leadership has concurred with every OPA recommendation. The Legislature has passed enabling laws.¹² Funding has been secured. Palau has already implemented ASYCUDA, and Guam has sent a delegation to learn from their experience.¹³ Every obstacle once cited as a reason for delay has been addressed — except the final execution.

The strongest move is both in parallel: sign the ASYCUDA contract and build the bridge system at the same time. When a container of whiskey arrives at the Port of Guam, someone should write it down in a computer instead of a cardboard box. That is not a radical proposition. It is the bare minimum — and the people of Guam have waited long enough.