With the yen buying significantly more U.S. dollars than it did a year ago and a five-day confluence of national holidays this month in Japan, Hawai'i tourism officials see some room for cautious optimism in the outlook for visitors from Japan this fall.

Japan remains one of Hawai'i's top markets for visitors despite a sharp plummet earlier this year in the wake of flu fears.

The yen, which is trading around the 90-per-dollar level, is up 15 percent against the greenback from this time a year ago and up 25 percent since September 2007. And the state government's latest projections are for a 3.5 percent increase in airline seats from Japan for the September-to-November period compared with a year earlier.

"I still believe that the strength of the yen offers great potential," although H1N1 flu is one of the uncontrollable factors that could offset travel from Japan to some degree, state tourism liaison Marsha Wienert said. And visitors from Japan are mindful of a fuel surcharge on flights to Hawai'i scheduled to resume Oct. 1.

The surcharge will add $80 to each round-trip ticket to Hawai'i, although the levy has been much higher in the past.

"It's not as bad as it was," Wienert said. "I don't think $80 is going to discourage anyone."

SEPTEMBER OUTLOOK

Those who specialize in bringing visitors to the Islands said September shows real promise although October offers mixed news, said Akio Hoshino, senior vice president of Jalpak International Hawaii Inc., which sells travel packages to visitors from Japan.

Hoshino said this year a series of national holidays in Japan that started yesterday and run through Wednesday allow people to take five consecutive holidays.

Travel specialists are calling it "silver week" because the holiday lineup presents a travel opportunity similar to the annual confluence that makes up Golden Week in the spring.

"It's good news, yen is very strong," Hoshino said. And his company's booking forecast shows business "picking up a little bit at a time."

Still, Hoshino is cautious. He knows that swine flu could kick up again and take away a large amount of Asian travelers. "It's very, very hard to estimate the numbers at this point."

Leon Yoshida is president of Sawayaka Hawaii Inc., an online travel company that brings about 30,000 Japanese visitors to Hawai'i each year.

Aside from the exchange rate, fuel surcharge, swine flu, and the downturn in global economy as a whole, Yoshida said travelers are watchful of a new political regime in place with Yukio Hatoyama of the Democratic Party of Japan. "As the businesses in Japan watch what the new government's position will be, it may affect travel and consumer spending," Yoshida said.

Businesses that cater to Japanese have seen some strength this year.

"We're going pretty strong from our Japanese customers," said Joe Heaukulani, who works at 88Tees in Waikiki, which enjoys a steady clientele of visitors from Japan.

MORE CHALLENGES

The store caters to various tastes and budgets from T-shirts that go on sale for less than $20 to some high-end vintage wear and Hawaiian jewelry that sell for hundreds of dollars. "We carry a wide range of price points," he said.

But Yoshida warns of more challenges ahead.

"The decline in our visitor arrivals is not over and will continue to affect the numbers in lower spending as well," he said.

"We saw several wholesalers close their doors or merge with other companies throughout 2008 and 2009," Yoshida said. Those included Hankyu, a major wholesaler, and Discovery Aloha, which has been wholesaling Hawai'i for more than 30 years, he said.

Yoshida also serves on the board of the Hawai'i Tourism Authority. He noted that the strength of the Japanese yen has improved against the U.S. dollar but it has also improved at other destinations Hawai'i competes with as well.

"Our wholesale division in Japan used to sell 4,000 to 5,000 tour packages a month to Korea due to the weak Korean won last year. On some good months, it went over 7,000 people," he said. "Just recently, they are sending 9,000 to Korea in one month. In comparison to Hawai'i, this is a huge increase."

Yoshida said he believes marketing in Japan should hone the message that Hawai'i has not been this affordable in a very long time. Yoshida said experts believe prices may never sink this low again as many believe that "we have now hit bottom and recovery stage should begin for the remainder of the year and throughout 2010."

He said his company is fortunate because 90 percent of customers are repeaters while Hawai'i's average is about 57 percent return visitors.

"It will take less time for our business to return to norm because our customers are not as afraid about traveling abroad compared to the first-time visitors, especially due to swine flu epidemic," Yoshida said.

"This was the case with our business rebound after 9/11 and SARS," he said.