ISTANBUL (AFP) - This week's suicide attack in Istanbul has dealt a fresh blow to tourism in Turkey, which had already lost holidaymakers due to growing European jitters over terrorism and a spat with Russia, once a top supplier of visitors.

Three months after double suicide bombings in Ankara that killed 103 people, mostly pro-Kurdish activists, the latest attack on Tuesday (Jan 12), which killed 10 Germans, clearly targeted the tourist sector, one of the mainstays in a country which was the world's sixth-most visited in 2014.

A record 36.8 million holidaymakers visited Turkey in 2014, according to the World Tourism Organisation, with Germans making up the biggest group, followed by Russians and Britons.

But the country's tourism appeal started to dim in 2015, with Turkey suffering the same fate as other Muslim countries such as Morocco and Indonesia that are being spurned by Europeans after attacks on tourists in Egypt and Tunisia.

"In the mind of the Western tourist, there is no doubt that the potential attacks by an Islamist group on one country will be associated to danger in the whole region. Those attacks, coupled with Turkey's own attacks and proximity to Syria, have a detrimental impact on tourism flows towards the country," said Ms Kinda Chebib, an analyst at Euromonitor International market research agency.

The flow of Russian tourists, 4.4 million of whom visited Turkey in 2014, had already slowed significantly in 2015 over the collapse of the ruble.

But the shooting down by Turkey's air force of a Russian bomber on the border with Syria in November turned the tap off completely.

Incensed by the attack, Russia warned its citizens against all travel to Turkey and recommended they head for the beaches of Russian-annexed Crimea instead.

The final tally of tourists received by Turkey in 2015 - and an estimate of their spending - is not yet known.

Euromonitor reports that the country's tourism profits fell 4.4 per cent in the third quarter of last year to US$12.29 billion (S$17.7 billion).

The attack in the historic heart of Istanbul, which the government blamed on the Islamic State in Iraq and Syria (ISIS) group, is expected to have an immediate impact on travel to the bustling metropolis on the Bosphorus, which is a popular weekend destination for Europeans in winter.

"This is the first time that I've been afraid for my life while on holiday," French tourist Nathalie Julien told AFP after the assault next to the famed Blue Mosque. "I just want to get home now, it's scary," she said.

Mr Jean-Pierre Nadir, president of Easyvoyage flight comparison website, was pessimistic about the chances of Turkey rebounding quickly as a destination, after months of making headlines for terror attacks and tensions, including with the country's own Kurdish minority.

"This attack, which comes on top of the confusion created by President (Recep Tayyip) Erdogan's policies that have tarnished the destination's reputation, puts a stop to (travel to) Turkey," he declared.

The message from Germany was mixed.

German tourism giant TUI said customers who had booked trips to Istanbul could cancel or reschedule their trip by Jan 18 without paying a penalty.

Interior Minister Thomas de Maiziere said there was "no reason to cancel trips to Turkey", even as the foreign ministry advised Germans to avoid tourist attractions in Istanbul.

Several European tour operators have already pared back their offerings for Muslim countries in their 2016 summer travel brochures.

French holiday club operator Marmara's packages for Turkey, Tunisia and Morocco account for only 20 per cent of its selection, down from 45 per cent last year.

The losses date back five years, since the start of the Arab Spring in Tunisia.

Tunisia's revolution set off a series of uprisings across the Arab world, most of which collapsed into civil war, sectarian strife or autocratic rule, combined with the march of terrorist groups like ISIS.

French tour operators say they have 750,000 fewer takers for package holidays in the Middle East and North Africa compared with a decade ago.

"The destinations now benefiting from the situation and expecting to attract an increasing number of tourists in the forecast are Greece, Spain and Portugal," said Euromonitor's Chebib, listing their main selling points as "competitive prices and political stability".