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Execs staying put amid war worries

The use of video and telephone conferencing may replace travel.
The use of video and telephone conferencing may replace travel.

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LONDON, England (CNN) -- Businesses are cutting back on international travel as the corporate conference industry and business class air travel are hit by the war in Iraq.

About 21 percent of U.S. corporations in a Business Travel Coalition (BTC) survey this week said they had stopped all international travel and a third of the rest were considering a ban.

"Terrorist threats against Americans and U.S. assets overseas and domestically are combining with war to drive near-term demand down further than many industry observers expected," BTC told Reuters.

In the UK, about 10 percent of business bookings to the U.S. are being canceled, said Veena Lidbetter, a director for conference reservation service Expotel.

"We are experiencing more cancelations in the transatlantic bookings now than we did during the Gulf War in 1991 because of terrorism fears," she told CNN.

"Companies believe they want to be responsible. They are saying 'our staff is important, we don't want to jeopardize them.'"

But Lidbetter says the terrorism threat is not the only reason businesses are canceling.

"The idea of getting stuck somewhere really rattles people," she said. "Businesses have to consider what they'll do if they send 40 of their staff away and then the airports shut or carriers cancel flights and they can't get them back."

She added: "Because businesses generally book conference venues six months in advance and war is not included in insurance coverage, most companies will hold onto reservations until the last minute to see how the conflict develops before canceling or postponing meetings."

Some companies are encouraging staff to use the Internet or satellite conference calls to replace travel, or have set up hotlines to let employees check travel risks before flying.

Wire One Technologies, which provides video communications, reported a 19 percent rise in demand for its videoconferencing service in 38 days following February 7, when the U.S. declared a Code Orange terrorism alert.


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