Airline stocks hit as tourists flee Bali

Airline stocks hit as tourists flee Bali

Michael Perry, Reuters, Sydney

Asian airline stocks were sold off and Bali's image as a
holiday paradise took a battering on Monday with thousands of
tourists fleeing, as the horror of blasts that killed at least
183 people on the island hit regional tourism.

"Bali was perceived as a paradise but unfortunately, that kind
of illusion has been destroyed," said Alicia Seah, a manager at
SA (UIC) Tours, one of Singapore's largest outbound agencies.

Thousands of frightened tourists fled the "island of the Gods"
on Monday along with bandaged and blooded victims from the bombs
that ripped through nightclubs near Kuta Beach late on Saturday.

The United States and Australia have branded the blasts in
Indonesia, the world's most populous Muslim country, an "act of
terror".

The blasts have heightened fear that al Qaeda, the Islamic
militant group blamed for the Sept. 11 attacks in the United
States, has regrouped.

Asian airlines felt immediate shockwaves from the blasts, with
investors worried about a sharp drop in tourist numbers to Asia
selling off stock.

Australia's Qantas fell 2.5 percent to A$3.58, while Singapore
Airlines slid one percent at S$10.20 and Thai Airways fell 0.7
baht to 24.80 baht.

Shares in Japan's All Nippon Airways, Japan Airlines System,
and Cathay Pacific did not trade on Monday because of Japanese
and Hong Kong holidays.

"Most of the key airlines in Europe which have flights to
Indonesia and Bali will come down, Lufthansa and British Airways
will react," said an Asian aviation analyst who declined to be
named.

But it will be the Hindu-island of Bali that will be hit the
hardest in Asia, facing a double whammy of the bombings and the
fact that Australians, who make up one third of its annual
tourist numbers, seem to be the worst hit by the explosions.

Fifteen Australians are confirmed dead, more than 100 injured,
some critically burned, and 220 unaccounted for.

Australian tourists discovered Bali in the 1960s when its
long-haired surfers first found its perfect waves. Fifty years
later Australia's influence in Bali's tourism industry is
omnipresent -- Foster's beer, batik-cloth beer bottle holders and
surf shops.

"The weekend bombs in Bali will strike close to the hearts of
many Australians," said The Australian newspaper's travel writer
Susan Kurosawa. "For decades we have treated the island as a
playground... Sadly, the Bali blasts could spell the end of our
holiday love affair."

But Asian and Australian tour operators put on a brave face
and said they believed Asian regional tourism should weather the
fallout from the bombs provided there were no more attacks on
holidaymakers.

However, Muslim nations Indonesia and Malaysia may be hit by
collateral fallout from the bombings, with, rightly or wrongly,
travelers associating the Bali bombings with Islamic militants.

Travel operators in Australia said on Monday they were
surprised at the small number of cancellations after Saturday
night's carnage, adding the tourism impact had been far less than
the Sept. 11, 2001, attacks in New York and Washington.

"After Sept. 11 the fear factor was much greater," said Sue
Smith, managing director of STA Travel in Australia, which
specializes in the student and youth travel market.

"This time around, the calls we have been getting are from
people considering their options, not cancellations," Smith said.

Smith said young travelers to Asia, aged 18 to 35, were
"resilient" despite the attack on the Sari nightclub, one of
their favorite haunts.

"After Sept. 11 the attitude was we would rather die on our
feet than live on our knees," she said.

Flight Center, one of Australia's largest travel operators,
was optimistic Asian tourism would survive the Bali bombings,
saying most travelers to the region were not as conservative as
Americans, who stayed at home in their droves post-Sept. 11.

"Traveling is such a part of the Australian psyche, they will
not stop traveling -- they may change destinations," said Shane
Flynn, Flight Center's chief executive officer.

"The Germans and Dutch are pretty hard-core travelers and they
will go anyway," he said, adding Asians would travel as they
would not see the Bali attack as aimed at them, but Westerners.

"They probably feel that being locals they will not be a
target and they wouldn't be the kind of people that would
frequent places like the Sari club," he said.

Smith said Asia was not one tourism market, unlike the United
States, but several culturally and politically diverse markets.

He said some Asian destinations would suffer, most notably
Bali, Indonesia and Malaysia but others like Thailand, Vietnam
and Hong Kong may benefit.

"As long as things quieten down now, things will get back into
full swing much quicker than you think," Smith said.

Asian-based tourism operators said the blasts were likely to
have limited impact on year-end travel, a peak season, as people
were likely to seek alternatives rather than cancel travel.

"It would dampen travel to a certain extent but not overly so.
People will be much more selective in the destination they are
going to," said Reene Ho-Phang, group director for marketing
communications at luxury Banyan Tree Holdings resorts.

The Singapore-based leisure group has resorts on the
Indonesian island of Bintan, Bangkok and Phuket in Thailand, as
well as in the Maldives.