By Orla Ryan In Mombasa, Kenya

Terror alerts have left Mombasa's beaches deserted

Sharif Alwi, who sells crafts from all over East Africa and has owned his craft shop in Mombasa's old town for 15 years, is not a happy man.

The town is all but deserted, and Mr Alwi now looks back with fondness on his days as a taxi driver.

Some days the 53-year-old does not get a single tourist in his shop, and he and his wife are having to get by on money sent home by their children who live overseas.

Mr Alwi is so disillusioned, he says he would sell his shop - if only he could find somebody willing to buy it.

Terror threat

Further along the coast, tour operators struggle to fill their huge beachfront hotels and craft sellers chase the few tourists who have turned up.

In recent years, tourists have avoided Kenya, despite its reputation as a leading beach and safari destination during the last three decades.

Every Kenyan employed feeds ten, so if you look at 15,000 jobs lost you have 150,000 mouths to feed Tasmeen Adamji Owner of African Quest Safaris

Last year represented a low point when a terror alert grounded flights to Kenya and sparked American and European travel warnings, which led to thousands of jobs losses and cost the country between $1m and $2m a week.

British flights have since resumed, but America still advises its citizens against non-essential travel.

Some Mombasa businesses have developed reserve plans.

Now hotels that once hosted beach parties host conferences, while others are looking to persuade the Kenyan middle class to come to the beach.

Mouths to feed

Tasmeen Adamji, the owner of African Quest Safaris, said last year was one of the hardest in her 18 years in the tourism industry.

Some of her biggest-spending clients had been American "incentive travellers" who had won an all-expenses-paid trip from their employer for their good performance.

Incentive travel accounted for only 5% of overall customers, but the business accounted for a far greater share of overall revenue, so the effect of the slowdown has been "massive", Ms Adamji said.

"You could see the expression on people's faces, they were desperate.

"A lot of people lost jobs and did not get them back.

"Every Kenyan employed feeds ten, so if you look at 15,000 jobs lost you have 150,000 mouths to feed," she said.

Glory days

Khuldip Sondhi built Reef Hotels on the north coast of Mombasa in 1971. He now looks back in fondness at the glory days of Kenyan tourism.

The hope for the future is that the economy will recover and that coast tourism will boom again, but I reckon it will take another two to three years Khuldip Sondhi Owner of Reef Hotels in Mombasa

"It was an exotic new destination - we had no competition from anyone," he said.

The American travel advisory put a complete halt to business, he said.

Mr Sondhi's hotel is, however, clearly busy.

On the day we met, the vast majority of people in the hotel were attending an Action Aid conference on Aids awareness for Muslims.

Conferences now provide about 80% of Mr Sondhi's business.

But unlike overseas tourists, conference goers do not want to lie on the beach or spend money at the bar.

These new customers provide less added value, but they have been a "survival kit for hotels", Mr Sondhi said, insisting that Mombasa's hoteliers need to diversify.

Optimism high

Other business people believe that overseas tourists will return to Kenya, sooner rather than later.

European charter tourists have long been the coast's 'bread and butter", especially for tour operators.

Khalid Shapi, managing director of Pollman's, the Kenyan operator for TUI (Thomson) said he expects charter flights from the UK to resume in November.

This would mean another "badly needed" 540 seats flying to Mombasa each week, he said.

His optimism is shared by Major William Kamunge, chairman of the Kenya Tourism Federation, who believes the travel advisory will be softened and the next season will be better.

Fundamental problems

But the problems of Kenyan tourism are not limited to the attitude of overseas flyers, according to Mr Kamunge.

Kenya needs to invest heavily in tourism, which contributes to 12% of the country's economic output, he said.

Even if the travel advisory is lifted, Kenya needs to improve its tourism product to attract younger travellers, Ms Adamji said.

Reef Hotel owner Mr Sondhi said money needs to be put into improving roads and bringing down the cost of electricity, factors which make Kenya an expensive destination.