YORK businesses could lose out by more than £12m after a severe drop in the number of American visitors to the city.

The American market, which usually accounts for half of all foreign visitors to York and includes some of the city's biggest spenders, has been badly affected by the terrorist attacks of September 11, although the full extent of the damage will not be known until figures for 2001 are released later this year.

Nationally the number of visitors to Britain in 2001 was down seven per cent compared to the previous year, with overseas visitor spending falling by 14 per cent to £11bn.

Tourism officials said the statistics came as no surprise as foot-and-mouth disease and the events of September 11 combined to produce a "devastating year" for the industry.

York's tourism industry was making a gradual recovery following the floods of 2000 and it remained constant during the foot and mouth crisis last year, mostly because many visitors were coming to the city because they were banned from the countryside.

Kay Hyde, PR manager for the First Stop York Tourism Partnership, said the number of overseas visitors to York was expected to have dropped by about 20 per cent since September 11 - equating to a £12.5 million drop in annual spending.

Now efforts are being made to make up the shortfall by attracting domestic and European visitors to York, and the latest exercise is a "meet the media" event in New York this month.

Ms Hyde said: "It was certainly a very difficult year - with the beginning of the year affected by the recovery after the floods and then September 11.

"We feel that we are doing our best to keep visitor numbers stable by targeting UK domestic market more.

"We do know that we are going to see a decrease in U.S. visitors to York.

"In 2000 the figure dropped from half of all overseas visitors to 33 per cent and we would expect that figure to drop even more.

"That's why we are going to lose out on the spending."

Jeff Hamblin, chief executive of the British Tourist Authority, said the full year results indicate that the Government was well advised to allocate additional funding in 2001 for marketing activities, including its new UK OK campaign launched last month.

He said: "Although not unexpected, these results prove that Britain's inbound tourism industry has been dealt a serious blow by the events of 2001.

"BTA's UK OK initiative, which is spearheading our efforts get visitors back to Britain, has already received widespread support and drawn much needed attention to Britain as a destination."

Updated: 11:44 Thursday, February 07, 2002