Air arrivals will improve slightly in 2010 however numbers will continue to be affected by the weak US economy, Premier Ewart Brown predicted yesterday.

His comments came at a press conference on 2009 tourism figures. Dr. Brown said it was his aim to be "frank and direct" about the state of the industry.

"The global economy is still a real concern," he said. "Notwithstanding some signs of recovery, it has not turned around yet. We all know that tourism in Bermuda continues to face challenges to maintain its fair share of an increasingly competitive market."

Bermuda's total visitor arrivals rose by one percent over 2008, to 559,000. The increase was fuelled by cruise passengers.

Dr. Brown, who is also Tourism Minister, said the number was disappointing. The 235,000 visitors who flew to the Island represented the lowest air arrivals in recent history.

"Although the number of visitors who arrived by air last year did not increase over 2008, over the year, the results got better and better," he said. "The results of each quarter of 2009 were better than the results for the one before. This trend of improvement continued into the last quarter, October to December."

But he said that the fourth quarter's air arrivals, which were down three percent, were a vast improvement on the first half of 2009. Air arrivals in the first quarter fell 22.75 percent compared to 2008. In the second quarter they fell by14.27 percent. The third quarter saw a 5.5 percent drop.

As a result of lower arrivals hotel occupancy was down. The average occupancy for 2009 was 51 percent, compared to 59 percent in 2008 and 67 percent in 2007.

"These results are clearly not good and tell us that there is still much work to be done," Dr. Brown said. "Bermuda [Department of] Tourism continues to support our hotel partners. Hoteliers have received an unprecedented $2.5 million in direct support for promotions.

"In addition to this direct financial support, the Government has assisted the hotels by deferring payroll taxes.

"We continue to believe that this continued support is necessary in the near term until we see a tangible turnaround in arrivals and in the economy."

He added that the department would consider continuing to defer payroll tax for hotel workers, but only if it made economic sense.

An internal pacing report from the Bermuda Hotel Association obtained by the The Royal Gazette in January showed several large hotels had seen occupancy rates fall 11 percent. The BHA does not collect occupancy rates from all hospitality properties.