Tourism Minister Renee Webb says the Island's marketing strategy is working despite a slump in visitor numbers in the first quarter of this year.

Overall, arrivals of 38,052 are down 10.7 percent for the first three months compared to 2002.

Ms Webb said the downturn was to be expected because of the war with Iraq and the SARS scare.

And she said the summer season is shaping up well and Bermuda will be well placed to take advantage when jittery Americans begin travelling again.

Ms Webb said US and European visitors spent close to $30 million in the first quarter, adding: "Bermuda's marketing goals are succeeding because the majority of visitors that are coming to the Island fit within the more mature and seasoned segment, which is the group to which the marketing campaign is aimed."

Moreover, not only has Bermuda done well to attract this segment of the market, exit surveys demonstrate that they are expressing great satisfaction with their visit.

"Bermuda, like the world, has come out of a difficult first quarter and all indications are that this summer will be a good one as far as air and cruise ship passengers are concerned.

"Placed in the proper context, visitor arrivals by air and sea can be appreciated as a direct result of the sluggish global economy, the war in Iraq, the heightened terror alerts and the threat of SARS, all converging to present some serious challenges to the first quarter figures.

"Nonetheless, I am pleased to say that more than 35,000 visitors came to Bermuda during the first quarter of this year despite the Homeland Security Agency's raising the terror level threat to orange, the second highest state, in February.

"It is important to point out that the vast majority of those visitors came from the US, and overall some 55 percent of our visitors during this period were repeat visitors who cited personal safety, hospitality and relaxation as the primary reasons for choosing Bermuda."

Some 87 percent of people were satisfied with the hospitality shown them, and 48 percent said the hospitality exceeded their expectations.

The exit survey of visitors showed 76 percent would definitely recommend Bermuda to others and 64 percent said they were likely to return.

And 70 percent of those surveyed had visited other Caribbean islands, with 53 percent of those preferring Bermuda.

"It is expected that once the uncertainty in the world economy due to the spill over effects of the war in Iraq have settled, there will be excess demand for travel as people in our main American markets start to look outward," she added.

"Bermuda is well placed to meet this anticipated demand and when that begins it will be reflected in more healthy numbers and greater use of the available hotel beds."