Tourist arrivals around the world are expected to slow this year due to high fuel prices, a U.N. official said on Monday, but he said he was confident the tourism sector was not overly vulnerable to the global credit crunch.

Francesco Frangialli, secretary-general of the U.N. World Tourism Organisation (WTO), said the financial crisis could cut down on travel and leisure spending but people across the globe were still traveling.

"We are worried, of course," Frangialli told delegates of the United Federation of Travel Agents' Associations.

"But, we are not giving in to panic. Experience teaches us that tourism is resilient. The need to go on trips, to take holidays, is too strong in our post-industrial societies."

He said the prospect of a deep recession in the United States and Western Europe had started changing consumer behaviour, although it had not stopped travel.

The crisis, he said, was likely to have less of an effect than the spread of Severe Acute Respiratory Syndrome in 2003, when travel fell off sharply, especially in Asia.

"American and European consumers have been spending less in their destinations," Frangialli said, reducing incidental expenditures, such as restaurants, entertainment and transport options.

"This has led to the popularity of staying with relatives and friends, at camping sites, mobile homes and social tourist accommodations."

While low-cost airlines suffered during the first half of 2008 due to high prices of fuel, Frangialli said many travelers were now using budget carriers.

He said about 900 million people traveled in 2007 and this number was expected to hit 1.1 billion in 2010, growing slowly from the 6 percent rise in tourism traffic last year.

BEACH COUNTRY

In the Philippines, the head of the travel agencies association said the impact of the financial problems in the United States would likely be felt in the first quarter of 2009.

"When a global economic crisis hits, the first thing that people cut are the luxury items and activities," said Jose Clemente.

"Traveling is one of them. Our bookings are still good until January because these were done much earlier. What we're seeing right now is a bit of a downtrend. We're not receiving as many bookings as we would expect compared to previous years."

Clemente said the Philippines remained one of the top destinations in Southeast Asia because of its tropical beaches, particularly Boracay, Cebu and Palawan island resorts.

He said newer markets had also been discovered, such as Russia, the Scandinavian states and India while tourist arrivals from South Korea and China remained steady.

Tourism Secretary Joseph Ace Durano said the government had scaled down its tourist arrival growth from a high of 10 percent to about 5-7 percent this year due to high fuel prices and credit problems in its major markets, such as the United States and Japan.

Tourist arrivals in 2008 was expected to hit 3.7 million from about 3.5 million last year.