Asia suffers tourism downturn

Thailand's tourist industry is facing big losses

By BBC South East Asia analyst Larry Jagan in Bangkok

Asia's economies are bracing themselves for more aftershocks from last week's attack on the World Trade Center in New York - this time it is the tourist industry which expects to be affected.

Airlines, hotels and tour companies across Asia are preparing for a wave of cancellations as travellers postpone or cancel their trips amid heightened fears about security and potential military action.

Japanese tourists are among main cancellations

The Thai tourist authority already expects a fall of 6% in the number of visitors from the US this year. While the Thai Farmer's Research Centre estimates that the tourist industry could lose an estimated $158m in revenue if American tourists stay at home.

Already Bangkok's biggest hotel, the Imperial Queen's Park, has had three major conferences postponed. The hotel is now operating at less than 60% capacity and expects this to fall even further in the next few months.

The reason, according to Imperial Queen's Park's general manager Bruno Huber, is a global reluctance to travel because of safety concerns.

"Most of the cancellations are from outside the US," he says.

Japanese sensitivity

Nearly 30% of bookings for the next two months at seaside holiday resorts - like Puket and Ko Samui - have been cancelled says a Thai travel consultant. Most of their cancellations are from the US and Japan.

Security at US facilities has been stepped up throughout Asia

"The Japanese are very sensitive about security issues and cancellations from there are a close second to the Americans," says Marcel Schneider, general manager for Diethelm Travel, one of the biggest travel companies in the region.

The rest of Asia is facing similar problems in the tourist industry.

In Indonesia at least 50% of bookings for the next two months have been cancelled says a major travel agent in Jakarta.

"Many of our long haul passengers, especially those with stop-overs in the Middle East, have cancelled," says an Indonesian travel agent.

Singapore relief

Singapore has not been as badly effected, says president of the National Association of Travel Agents in Singapore, Leeliat Cheng.

He says: "That is largely because many of the island's visitors are businessmen whose travel arrangements are less flexible than those might be travelling for leisure."

Familiar surroundings but US tourists are nervous

Travel to the US, he says, has plummeted: "Almost all flights to the US have been empty since the attack."

In Hong Kong the number of visitors has dropped by 50% in the past week.

Japanese travel companies are also bracing themselves for massive losses - Tokyo travel agents estimate more than $450m.

Half of those people planning to travel overseas from Japan in the next few months have cancelled, according to the Japan Association of Travel Agents.

Many travel authorities throughout the region are responding with plans to concentrate on encouraging tourism within the region.

New markets

Deputy Governor of the Tourist Authority of Thailand, Mrs Juthamas Siriwas, says there are already plans to change marketing strategies.

"We want to attract more visitors from Asean countries and north-east Asia," she says.

Tourist downturn could cost the region billions of dollars

Leeliat Cheng, of Singapore's association of travel agents says his members plan to concentrate on a similar strategy.

"We want to encourage prospective tourists to consider Asean and Australasia as good alternatives to the United States," he says.

Major challenge

Analysts still feel the tourist industry is facing a major challenge in the coming months.

Emphasising safety and security, and seeking new customers may not be enough to stimulate travel and tourism within the region.

In the wake of the US terrorist attacks, the key issue remains what happens to the US and Japanese economies in the next few months.