IMPACT OF THE GULF WAR : Belly Dancers Feel the Chill of Wartime : Entertainment: Troubles in the Mideast lead to sharp decline in demand for Laguna Beach-based dancers.

When there’s trouble in the Middle East, Latifa dances less often.

Falling bombs in the Persian Gulf mean falling business for this belly dancer who runs Arabesque Belly Dancers in Laguna Beach. Latifa (whose offstage name is Therese Davis) weathered sharp declines in business during the Iran hostage crisis in 1979-81 and the U.S. bombing of Libya in 1986. But the war with Iraq, she fears, may bring an end to her 10-year-old business.

She blames an emotional backlash against things Middle Eastern as the main reason for a big drop in bookings for her and her harem of five dancers, who primarily perform at private parties and conventions. The recession hasn’t helped matters either.

In Orange County, belly dancers perform at a handful of Middle Eastern restaurants and at fashionable parties in places like Newport Beach.

“It’s not so much that the audience is offended, it’s more that the people who book us are afraid to take the risk,” Latifa said. “They are concerned with offending others, with being involved in any kind of controversy.”

To survive in past Middle East crises, Latifa’s dancers--all of whom are American--have dressed in Gypsy or Mexican costumes. Sometimes the six dancers perform in Cleopatra-style wigs and dress, an outfit that seems not to offend like the shimmery veils and gold coin jewelry of the belly-dancing trade.

Blond-haired and blue-eyed, Latifa says people often tell her she looks like actress Barbara Eden from the “I Dream of Jeannie” television show--even when she’s not in costume.

When business is good, Arabesque’s dancers accept as many as five invitations in a night to dance at parties.

Normally, Latifa’s troupe performs about once a month for conventions at various hotels, and customers can hire dancers for private bookings. She is keeping her business telephone line open to accept group bookings, but business has been very slow since August.

Kamala (whose offstage name is Kim Mischook) is a member of Latifa’s troupe, and she performs two 15-minute lunchtime shows at an Armenian restaurant in Pasadena, the Burger Continental. Thursday morning, as she was about to leave for her first performance since the outbreak of the Persian Gulf War, she said she felt odd and a little nervous.

“Sometimes when I start playing Arabic music, I wonder if people are going to say anything, but I haven’t had any negative reaction yet,” she said. Kamala points out that belly-dancing had its origins in Egypt and Turkey, not in Iraq or Iran.

Latifa, 34, said anti-Arab sentiment is stronger this time than it has ever been. She said she will be sorry to leave the business because she has put thousands of dollars into costumes, and the troupe has worked for years to perfect its dances.

She said she was the first American to study under Farida Fahmi, one of Egypt’s top dancers. When she formed her own troupe after 17 years of performing and teaching, Latifa said she wanted to change the image of belly-dancing. She emphasized the elegance, the skill and the art of the dance.

“I was very concerned about my responsibility to do something for the image of belly-dancing,” she said. “I feel I have changed some perceptions.”