Tourism in Bermuda is heading for three lean years as a recession starts to hit the holiday business.

According to figures released by Premier and Tourism Minister Ewart Brown, since January overall arrivals have slipped 4.29 percent while air arrivals are down 10 percent compared to the first six months of 2007.

Total visitors to Bermuda slipped from 232,806 visitors to 222,821 and the biggest fall was visitors from the US which dropped 14.5 percent.

And with the world focusing on rising oil and food prices it appears tourists aren't reaching as deep in their pockets as they used to.

The Department of Tourism estimated visitors spent between $58 and $75 million during the second quarter compared to the 2007 estimate of $77 million to $80 million spent during the same period last year.

Dr. Brown said: "We are going to have some thin years; 2008, 2009 and 2010. We are going to have to call on our creativity to keep numbers up. By 2010 when hotels are built, that will be a magnet because Americans are brand driven.

"As you will know, in the face of tough economic times in the United States, it has been difficult in this calendar year to keep pace with our blockbuster performance of 2007."

While maintaining that Bermuda "continued its consistent march upward to the Platinum Period" he admitted the current US economic situation, with many commentators speculating the country is on the brink of a recession, was worrying.

He said: "As you will know, in the face of tough economic times in the United States, it has been difficult in this calendar year to keep pace with our blockbuster performance of 2007."

Dr. Brown mentioned the Platinum Period 12 times during his quarterly bulletin speech on Wednesday saying it is the top-to-bottom improvement of the Bermuda tourism product and added: "We are focused on encouraging upgrades in the hotel product, enhancements in the golf product and we've stepped up transportation offerings as well."

But in response to questions Dr. Brown said: "There is no question we expect to see some decreases [in travellers] as a result of the US economy.

Many companies are already starting to trim their belts and decreasing the number of people travelling and tourists are spending less."

As far as hotel developments that have been touted in the past Dr. Brown agreed that a recession could put a halt to financing them.

He said: "Of course it is a concern. But so far so good, no developer has come and said they are backing out because they do not have financing. I am so glad we got those special development orders through so quickly, without those these developers might have already gone."

The Premier gave little details about what would be discussed in an upcoming Tourism Summit, which is being held in two weeks to assess the current state of the industry, but said they would look at shifting resources to Canada, the UK and Europe where there have been increases in air arrivals.

He said: "We'll talk about the US economy and discuss to what extent we need to shift additional resources to Canada, the United Kingdom and Europe where economic conditions are healthier, but airlift is limited."

However, this week British Airways revealed it was now paying about $16 million a day on fuel and said price increases were inevitable. The airline is also shutting some routes.

During the speech the Premier also spoke of other advances the Department has made throughout the second quarter, such as the Newport to Bermuda Race and Newstead development opening.

According to figures released by Dr. Brown, in 2004 there were 204,812 total visitors in the first six months; 2005 there were 218,217 total visitors in the first six months; 2006 there were 265,835 total visitors in the first six months and in 2008 there were 267,666 total visitors in the first six months.

According to a statement in the past five years, only 2007 outperformed 2008 in the first six months. In 2007 there were 281,607 total visitors in the first six months.