The recent measures targeting three and four-star hotels are taking a heavy toll on the tourism industry in Bahrain.

A leading Asian hotelier has stopped his expansion plans in Bahrain and started transferring his investments abroad.

Sources told our sister paper Akhbar Al Khaleej that the investor had already bought two hotels in Dubai and Sri Lanka.

The Asian tourism guru, who invested massively in Bahrain market, owns 11 hotels, including four that are under construction in Juffair, Hoora and Exhibition Avenue.

In an undeclared move, he has reportedly started liquidating his business in Bahrain's unstable market as part of plans to explore new investment opportunities in the UAE, Qatar and Oman, in addition to other prized Asian destinations.

'He is not the only hotelier, who has decided to flee the Tourism Directorate,' sources said, warning that more investors may announce 'bankruptcy' soon and withdraw from the market.

Other hoteliers are trying to limit the damage, pinning hope on the recent Cabinet reshuffle which may prompt a rethink of the tourism policy.

Meanwhile, most investors and developers are facing administrative and legal cases in the aftermath of the recent tourism measures.

Tenants, who are facing 'imminent bankruptcy', have lodged cases to abrogate contracts signed with landlords and recover the cheques deposited as guarantees.

Some others have filed cases to persuade landlords to slash rents by half as their hotels are suffering massive losses. A few landlords are suing hoteliers for non-payment of rent.

'Laid-off employees are reportedly filing court cases to get their unpaid dues,' sources said, describing the situation as an 'unprecedented farce' in the history of Bahrain.

One leading investor is facing 12 court cases regarding ownership rights and non-payment of rent. He said that he is currently facing so many labour court cases that he hired three law firms.

He described the disastrous situation at his three-star hotel in Adliya as he rents rooms for BD12 to staff of GCC companies in Bahrain.

'All hotels are suffering due to the current crisis shaking the sector. We are trying hard to preserve our rights before the whole sector sinks,' said the investor.

The average four-star hotel occupancy dropped to 35 per cent during National Day holiday, from 75 per cent last year.

'The recent decisions taken by the tourism directorate against three- and four-star hotels have wreaked havoc on the sector,' Four-Star Hotels League chairman Hameed Al Halwachi said.

He said most tourists stopped coming to Bahrain, preferring other attractive destinations.

Four-Star Hotels League has 14 units, including Al Safir Hotel and Tower, The Mercure Grand Hotel, Hotel Novotel Al Dana Resort and The Marriott, Ramada.

The occupancy rate fell sharply this year during the National Day, which is one of the much-awaited occasions to revitalise the sector and boost revenues.

He deplored recent decisions which left the sector in limbo.

'The plummeting occupancy rate and declining revenues show that tourism authorities are adopting a wrong policy,' stated Al Halwachi.

He said the directorate did nothing to help hotels overcome the repercussions caused by the closure of discos.

He joined other hoteliers in calling for the establishment of an independent tourism authority to save the sector.

Meanwhile, a senior investor said most banks have reportedly stopped funding any new tourism or hotel projects, particularly three and four-star units, requiring big guarantees as the tourism schemes are becoming highly risky.-TradeArabia News Service