The latest hotel occupancy rates -- for June -- show a more than five per cent fall for the month compared to the same period in the two previous years.

And the projected figures for July, August and September are still below 1995 -- a year when tourism was hit badly by fears over hurricane threats.

Tourism Minister David Dodwell said he was confident that figures for July and August would pick up because of an increasing trend towards late bookings.

He added: "September concerns me -- it could be a reaction to the hurricanes we have already this year. People identify us very closely with the Caribbean and we have already had calls.'' Mr. Dodwell said that the US was also showing a trend for "stay-at-home'' holidays.

He explained: "People are travelling within their state or the state next door.

"There's less travel overseas, whether it's economic difficulties or heavy promotion by individual states, people are staying at home.

"It's an extremely tough summer and we are all going to have to try extremely hard.'' But he added that the Tourism Department and hotels were co-operating in a a promotion drive in the retail sector to make sure Bermuda "gets more bangs for each buck'' in a bid to reverse the trend.

And Mr. Dodwell said: "The numbers for July and August this year are close.

They are close enough that I am confident we will be able to close that gap.'' The gloomy occupancy figures were released by the Bermuda Hotel Association.

Hotel occupancy for June was less than 80 per cent. That compares to 84.6 per cent in 1995 and 85.1 per cent in 1994.

And the projected rates for the rest of the summer are expected to fall short of previous years, although the BHA expect some pick-up over 1995's hurricane-hit bookings.

The projected figure for July is 68.5 per cent compared to the projection of 68.9 per cent for July 1995.

For August, the projections are 47.7 per cent -- 2.1 per cent down on the projection for the same month in 1995.

And the September projection -- 37.9 per cent -- is more than 7.5 per cent down on the projected figure for the same period last year.

But Bermuda Hotel Association president Stephen Barker was putting a brave face on it for the rest of the year.

He said: "The 1995 results for August and September were severely impacted by the repeated threat of hurricane activity.

"For this reason we can expect occupancies for the ensuing quarter to be an improvement over 1995 -- but still well down from previous norms.''