The summer tourism season has arrived in Old Montreal, but the tourists have not.

The streets, restaurants, and boutiques of this picturesque 18th-century neighborhood are usually crowded with Americans on holiday. But this year, they’re eerily quiet, and area businesspeople say this could be the worst year yet for an industry that’s taken a beating since 2001.

“Each year there’s been a challenge: We had 9/11 and the SARS outbreak, the exchange rate, and high gas prices,” says Gisele Beauvais Olivier as she arranges Quebecois ceramics in her boutique on Rue St Paul. “Americans are very good customers who appreciate handicrafts, but they are not here as usual.”

It’s a situation being played out across Canada, where visits by Americans have been plummeting for years. In March, the last month for which official statistics have been released, visits by Americans fell to their lowest level since record keeping began 36 years ago. Data released June 28 showed foreign tourist spending in the first quarter fell to the lowest level since 1999, and that the number of U.S. visitors has fallen by nearly a third since 2003.

“Canada’s tourism sector is on the brink of crisis,” says Randy Williams, president of the Tourism Industry Association of Canada in Ottawa. “We’ve been facing a lot of external challenges, and each time one gets dealt with, another one comes along.”

Mr. Williams’s organization describes a “perfect storm of adverse conditions” in a country where nearly 90 percent of the tourist trade is American: sky-high gasoline prices, confusion about new U.S. customs and passport requirements, border crossing delays, and the U.S. dollar’s 30 percent fall against its Canadian counterpart over the past two years.

Among the hardest hit are communities and businesses that rely on short-term, drive-in tourists. In March, Americans made only 730,000 same-day car trips, down 2.5 percent from February and 68.3 percent from 2001.

“The season has gotten off to a slow start,” says Pauline Alexander, who works at the Roosevelt Campobello International Park, one mile beyond the bridge linking Campobello Island, New Brunswick, with Lubec, Maine. Annual visits to the park’s centerpiece – Franklin D. Roosevelt’s summer home – have fallen by a third since 2001. “It’s been really hard for people on the island,” she says.

The Stratford Shakespeare Festival in Ontario has also seen its U.S. clientele wither, with ticket orders off by 10 to 12 percent compared with 2007. “Until this year, we’ve been somewhat protected from the downturn. But now we’ve seen the most significant drop,” says the theater company’s media manager, Ann Swerdfager. “There’s the weak dollar, high gas prices, and a lot of confusion about what kind of documents are required to get back into the U.S.”

U.S. Customs and Border Protection now requires U.S. citizens to have a passport to re-enter the U.S. by air, a requirement originally slated to extend to land and sea border entry points on Jan. 1. Those requirements have been postponed to sometime next year, but U.S. citizens still need both a driver’s license or other government-issued photo ID, and government issued proof of citizenship, such as a birth certificate.

Ms. Swerdfager says she regularly fields phone calls from U.S. patrons unsure of the border requirements. The festival is also trying to woo back Americans with a series of discounted ticket packages.

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