Shadow Tourism Minister and hotel owner David Dodwell last night said he was optimistic that the war in Iraq would not badly damage Bermuda's holiday trade.

He said bookings for the month of April were slow, but those people who had already booked to stay at The Reefs were continuing with their plans.

And he said inquiries were coming in as usual for later on this summer.

"We have had some slow down for April, but the bookings have been steady for the rest of the year," he said. "People are concerned and they want to know what will happen if they cancel, but they are generally upbeat.

"We have developed a cancellation policy for the war and various stages afterwards. In my view, cancellation policies should favour the customer and not make it too onerous on them."

Mr. Dodwell said his policy, should people wish to cancel because of the war, was to encourage them to re-book for another time in the future, but he said hotels should be flexible.

"We have had some questions from people about what will happen if they decide not to come, and we are being very flexible," said Mr. Dodwell. "We are taking it one day at a time. I would say there has been a little bit of caution on the part of the customer, and we have been a little quieter, which could be as a result of the build-up to the war.

"But in the long run of the summer, I don't think Bermuda should lose out. Bermuda's location should help it because it is so close to the US, so if people do need a vacation, they may be happy to travel here.

"I know that Europe is not in good shape, and the Caribbean is struggling.

"But I think once the Iraqi regime is broken down, there will be a sense of relief and the pent-up desire for travel will be there.

"We had a reasonable year last year - not the best but reasonable - and I think that once we get past April this year, it will be OK."