(AFP) Hotels are facing many cancellations as business people and tourists are putting off their travel plans in the aftermath of the terrorist attacks in the United States, industry officials said.

Hoteliers attribute the business slowdown directly to the Sept 11 attacks on New York and Washington and are unsure how long room demands will remain soft.

Bracing for a rough ride, they said uncertainty was keeping travellers at home as the US prepares for a war on terrorism.

"People are cutting back their travel plans. We were supposed to get a large number of Japanese and German business people during this month but they have cancelled their trip," the general manager of a 300-room, five-star hotel in Kuala Lumpur told AFP today.

He said his hotel was 60 percent full but was worried it would "go down."

"We have not recovered fully from the Asian financial crisis. This is another unexpected blow," he said, speaking on condition of anonymity.

The general manager ruled out a price war among the hotels since there was a surplus of rooms. "People are not willing to travel, so there is no point to cut rates."

Christian Hassing, general manager of the Mandarin Oriental told AFP that the hotel had already experienced cancellations from US guests. "Two US conferences scheduled in our hotel have been called off," he said.

Hassing said there had been a slight drop in guest check-ins since Sept 11 but the hotel, with 643 rooms, was 82 percent full.

"There is a hold-back on international travel. We are slightly affected but not severely since 70 percent of guests are from Asia - many of whom are still travelling," he said.

Hassing attributed the slight decline to security concerns and uncertainty over a possible military campaign by the US.

"Currently there is a scare. Travelling is no longer a joy. We are adopting cost-cutting measures should the worst happen," he added.

'Playing safe'

But Tunku Iskandar Tunku Abdullah, president of the Malaysian Association of Tour and Travel Agents, told AFP that member operators have not reported any major cancellations following the terrorists attacks.

"Generally the (inbound) market is stable. But the industry is playing safe," he said.

Arul Dass, managing director of Tourland Travel Sdn Bhd told AFP that a party of 230 Indian nationals who were due to arrive in Kuala Lumpur last week have cancelled their trip.

"Another 400 people from India have also cancelled. Other operators are also experiencing a lot of cancellations from other countries," he said.

"Uncertainty is keeping them at home. We do not know what the US is going to do now."

The tourism industry is Malaysia's second-largest foreign exchange earner after manufacturing.

Tourist arrivals to Malaysia rose 44 percent to 7.24 million in the first half this year.

In 1999, a total of eight million tourists entered Malaysia, up 2.5 million from the year before.

The traditional sources of tourists are Australia, Germany, Japan, New Zealand, South Korea and the UK.

Malaysia is now wooing visitors from Asian countries like China, India, Indonesia, Singapore, Thailand, and Middle Eastern countries to counter the impact of the US economic slowdown.