The US market share of international tourism trade is at an all-time low and has dropped 35% since 1992, according to the Travel Industry Association of America (TIA).
At the 2006 summit of the World Travel and Tourism Council this week, managers of tourism firms looked into the reasons behind the slump which began with what they called "the disastrous impact" of the attacks of September 11, 2001 on New York and Washington.
The stricter US immigration policy introduced in the aftermath of the attacks, such as stringent visa requirements and demands that foreign countries issue biometric-enabled passports, has done little to encourage tourism, they said.
The US has also been routinely fingerprinting and face-scanning foreign visitors.
Thomas Donohue, president and chief executive officer of the American Chamber of Commerce, said the US must "get over the paranoia and start bringing people" to the country.
Arabs not welcome
"Because of US immigration laws, if you want to do business with the Arab world you have to go to London" because it is virtually impossible for Arabs to obtain a US visa, Donohue added.
"We have to get over the paranoia (of September 11) and start bringing people to the US"
Thomas Donohue, CEO of the US Chamber of Commerce
Disapproval of the US invasion of Iraq also translated into less tourism.
Jay Rasulo, the chairman of Walt Disney Parks and Resorts, said: "Among Europeans, [the US] was the third favourite destination, now it's the sixth and declining."
Moreover, competition in the tourist market has become stiffer as the European Union expands its borders and emerging powers such as China become more attractive destinations.
For the United States, losing ground in the world tourist market is a costly proposition.
About $286 billion has been lost in tourism revenues since 1992, according to the TIA, and one out of eight jobs in the US is directly or indirectly dependent on tourism.
Industry leaders said it was vital to press ahead with promotional campaigns and urged the government to review its immigration policy.
"It needs a well funded marketing campaign, and it needs safe but welcoming borders," said Walt Disney's Rasulo.