By Roger Collis International Herald Tribune - AS the Asian recession proves far more severe than expected even six months ago, business travelers continue to enjoy the benefits of cheaper flights and hotel rooms. With airline loads and hotel occupancies plummeting, a region that was beginning to price itself out of the market has become a traveler's fairy tale. This is reflected in the American Express Asia-Pacific Airfares Index for the second quarter of 1998, which shows an overall decline in fares across the region. Asia now offers some of the cheapest air fares in the world.'' The American Express Airfare Index shows that while published fares across the Asia-Pacific region have increased by an average 2 percent when measured in local currency, they have fallen by an average 9 percent when converted into U.S. dollars.
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But after months of absorbing exchange-rate depreciations across the region, airlines have now increased local currency fares to partly compensate. Certain routes from New Zealand have seen premium fares slashed by 30 to 35 percent as competition intensifies in that market. It is now cheaper to fly to London from Auckland than from Sydney. Meanwhile, the cost of flights from Hong Kong are up 3 to 5 percent. But these increases pass on to travelers only a fraction of the depreciation in those currencies in the past year.