Despite claims from travel industry professionals that the conflict in the North was not having a major impact on tourist arrivals, the latest data from the Israel Airports Authority proves otherwise. The IAA, this week, reported an 8.2 percent drop in passenger arrivals at Ben-Gurion Airport in July compared to last year after having predicted in June that the airport would see a 10% rise in traffic through July and August to approximately 2.25 million passengers. The IAA said 438,716 passengers arrived in July, compared to 478,000 in July 2005, while the number of travelers leaving the country also declined 1.6% to 496,330, bringing the total traffic through the airport to 935,046, or 4.8% lower than the 2005 figure. In contrast, the number of flights (inbound and outbound) that operated in July rose 8.2% over last year to 6,940 after the airlines increased their operations into Tel Aviv in time for the summer season. While the tourism industry's expectations were being exceeded in the run-up to the fighting - the IAA's passenger count for the first seven months of the year was still 8.6% higher than last year - July has brought things to a halt. In the three weeks that have passed since the outbreak of violence, aviation and hotel industry professionals reported that cancellations were being made approximately one month in advance of planned travel as tourists waited to see how long the conflict would last. Bookings for the Jewish festival season in late September-early October, they have assured, however, are still standing for the time being. but the more dangerous trend to their businesses is the lack of new reservations coming in. Based on past war-related experiences, the industry is projecting two possible outcomes as it watches developments across the Lebanese border. The first scenario would be a prolonged campaign that would trigger an extended absence of tourists from the arrivals hall at Terminal 3. The hoped for scenario, however is that tourists will emulate their reaction after the first Gulf War when tourists returned to the country almost immediately. "We believe tourists won't take long to come back, just as they did after the Gulf War," Eli Gonen, president of the Israel Hotels Association told The Jerusalem Post. Meanwhile, as the industry holds its breath and looks to the more optimistic second option, the Cabinet this week approved the budget for development projects of the IAA for 2006 to 2008. The government will provide NIS 374 million to upgrade the country's airports over the period and a further NIS 335m. for future commitments to be made in that period. Winter hopes The government, meanwhile, is already looking at the coming winter season to welcome tourists back to the country. Tourism Minister Isaac Herzog and Romanian Ambassador to Israel Valeria Mariana Stoica agreed Wednesday to develop a working relationship in the area of tourism. The ministry said the two countries would work to arrange a conference for Romanian tour operators in Israel in the autumn. Stoica said that as Romania works to join the European Union, she saw a need to boost tourism to Israel and that Romanians were looking for attractive destinations to visit during the winter season. While approximately 60,000 Israelis visit Romania each year, just 9,600 Romanians came to Israel last year. The first half of 2006 saw a 50% rise in arrivals to 6,700, compared to the same period in 2005. Issta looks to European hotels to spur growth Israeli tourism also spread its wings in the private sector this week as Issta Lines said it would expand its operations by purchasing hotels in Europe. The company plans to set up subsidiary companies in Israel and abroad to achieve this goal. Issta chairman Shimon Siboni said the decision was part of the company's five-year strategic program to develop new income sources that will work in synergy with the group's existing operations. He added that Issta would look at strategic locations in Western Europe to make the purchases. The company said it does not yet have details of the planned project and that it would look at potential sites in the coming months. In March, Issta raised NIS 30m., which it will use to fund the program. Traveling for love With Tu Be'Av, the Jewish version of Valentines Day, approaching on August 9, Shelly Tours has presented its list of "The 10 most romantic places in the World." On the list: Paris' Eiffel Tower; the Golden Gate Bridge in San Francisco; a tour on the canals of Venice ending at San Marco Square; Charles Bridge in Prague; the Maldives Islands; Florence, Italy; Hawaii; Puerto De Sol; Rio De Janeiro; and Santorini, Greece. Shelly Tours is offering special deals to a few of those destinations including seven nights in the Maldives for $2,920 with return flights (via Colombo), hotel accommodation on a bed and breakfast basis and transport from the airport to the hotel.