except in the tourism sector where arrivals and spending by visitors lagged behind last year.

Most economic indicators in Government's Quarterly Bulletin of Statistics -- released yesterday -- showed strength, including Government revenue, new construction projects, company formations and employment income.

But air arrivals fell 6.9 percent in the second quarter from 132,502 to 123,325.

And estimated visitor spending dropped from $164.6 million to $157.4 million or 4.3 percent in the second quarter. For the first six months of the year, spending dropped 3.1 percent from $218.3 million to $211.4 million.

New home construction also fell from 61 in the second quarter of 1996 to 19 this year. For the first half it fell from 103 to 53.

Despite the fall, the construction sector was robust as a number of major private and capital projects were undertaken.

"Spending by both Government and private developers was estimated at an estimated $34.1 million (in the second quarter),'' a Government statement said. "New projects estimated at $17.7 million were started during the period.'' Government revenue in the second quarter rose $4.2 million to $94 million in the second quarter, while central Government expenditure was estimated at $120.7 million, including $16.2 million in capital outlays.

For Government's financial year to March 30, Government revenue was $459 million, while expenditure was estimated at $490.4 million. After removing $71.4 million in capital outlays, Government had a current account surplus of $40 million.

International company formations rose from 256 to 296 in the second quarter while 60 local companies were formed -- an increase of 14 on in 1996.

Imports -- a key indicator of confidence in the economy -- declined slightly in the second quarter, with $160.5 million worth of goods brought into the Island compared to $161.2 million in 1996. That offset a large increase in the first quarter when imports rose from $126.9 million to $145.3 million.

Employment income rose from $318,909 in the second quarter of 1996 to $337,434 in 1997.