War in Iraq could have a devastating impact on the $460 billion global tourism industry still struggling to recover from a slump after the September 11, 2001 attacks, tourism experts from around the world said.

While airlines and travel companies expect a sharp drop in bookings this spring and summer, Mediterranean states depending on tourism as a main source of income fear that empty hotels and deserted beaches could tip their economies into recession.

The industry now expects a shift to short-distance trips, with western holidaymakers deterred from long-haul travel by the prospect of an Iraq war, months of unrest and a repeat of last year's attacks on tourists in Bali, Kenya and Tunisia.

And countries considered safe, like Switzerland and New Zealand, could gain at the expense of more exposed regions.

When war begins travellers are likely to be captivated by the "CNN effect", staying home to watch war coverage on television, said Cathy Keefe of the Travel Industry Association of America, which represents over 2,000 industry-related organisations in the United States.

"It will keep Americans and international travellers home in the short term," said Keefe, adding that war would be "devastating" for the industry.

"Even without factoring in the war, the industry had been looking at 2004, 2005 before we got to pre-September 11 levels."

The impact of war will feature heavily at the world's biggest tourism trade fair, the International Tourism Exchange (ITB) in Berlin, which starts today with tourism experts from 181 regions and states attending.

"It's a disaster," said Lakis Avraamides, a hoteliers spokesman on Cyprus, a popular Mediterranean destination on the edge of the Middle East. "All this yes or no to a war has been going on for too long. People won't make bookings, particularly not to the eastern Mediterranean."

Tourism accounts for 20 percent of the island's economy. In Egypt, where tourist numbers recovered to record levels last summer from a dip after the September 11 attacks, Tourism Minister Mamdouh el-Beltagi has said the industry would lose about $2 billion if a war was launched.

And in a clear sign of bad times ahead at least for the coming months, Germany and Japan, among the world's top five spenders on tourism, are reporting bookings for March and April down on the year before.

German bookings are down six percent, with high unemployment and a weak economy stunting people's wings as much as war fears.

But striking a more upbeat tone, analysts say markets could bounce back quickly as happened after the 1991 Gulf War.

The German DVR travel industry association said history gave cause for some optimism. The 1991 Gulf War brought holiday travel to a virtual standstill at the start of that year but by year-end package operator revenues had rebounded significantly.

Europe's biggest travel group TUI AG and German national carrier Lufthansa AG, meanwhile, both say demand remains fragile in the face of gathering war fears.

"In people's heads the war in Iraq has already begun," Stefan Pichler, chief executive of Europe's second largest travel firm Thomas Cook AG said. The group's bookings in the summer season for 2003 were down nine to 10 percent from 2002.

Analysts say U.S. airlines could survive a short conflict with Iraq but a prolonged war would likely produce some casualties among major carriers. Demand for air travel is already at its lowest level in decades and fears of a war have weighed on advance reservations for transatlantic tickets.

Some industries' pains could become others' fortune as war fears could drive holiday makers to regions they consider safe.

Places like Vietnam and New Zealand see a quick pick-up in tourism after an initial fall due to a war. "Vietnam is still one of the safest places in the world for tourists and it is clearly our advantage," said ATC Travel director Hoang Anh Tuan.

New Zealand gained market share in three of its main markets - Britain, the United States and Japan - in the years after the 1991 Gulf War and the September 11 attacks as it was seen as a safe and isolated destination.

In the Middle East, Gulf Arabs flocked to Lebanon last month to spend the Muslim Eid al-Adha holiday in the relative calm of Beirut, Tourism Minister Karam Karam said. He saw a 25 percent rise in tourism this year.

Around the globe, travellers are turning to short-distance holidays and are shy of making bookings in advance.

"This year will be the year of the last-minute trip," said Amedeo Ottaviani, president of the Italian tourist board.

In Britain, Washington's closest ally on Iraq, a war would hit the 2.5 billion pound ($4 billion) transatlantic tourist trade, and could cost Britain's hospitality industry a billion pounds, a British Hospitality Association spokesman said.

Independent journalism costs money. Support Times of Malta for the price of a coffee.

Support Us