His comments came just one day before two bombs exploded in an outdoor Jerusalem market on July 30, killing and maiming shoppers.
Netanyahu told a gathering of the Israel Hotel Association in Jerusalem, which had appealed to the government for marketing funds, that tourism advertising was currently being wasted as "it doesn't appeal to tourism decision makers abroad."
Tourism figures have dropped over the past year following a spate of terrorist attacks. Last year, there was a 7% drop in tourist arrivals to Israel to 2.3 million, compared with 1995, and already there's been a 5% drop in the first half of 1997, compared with the same period last year.
Israel Hotel Association president Mickey Federman called on the prime minister to add a relatively low sum of less than $10m to the tourism budget in order to market Israel as a safe country for tourism and not to fall into the Gulf War trap where the decision was made to wait until the effects of the war were over before marketing Israel.
The result of that strategy was a massive drop in tourism in 1991 to below 1.2 million. Estimates are that $1.8bn in foreign revenues have been lost already this year, due to the loss of a potential 1.4 million tourists.
The tourism industry, along with the Tourism Ministry, has already planned a $28m international campaign for the end of the summer to counter the negative effects of the media on Israeli tourism, but industry officials are looking for added government participation.
Netanyahu said the government was concentrating its budget on defense instead, and would only increase the tourism marketing budget if the industry would match the funds.
Copyright July 1997, Crain Communications Inc.