Japan tourism continues to struggle in the wake of the devastating earthquake and tsunami that sparked nuclear-disaster fears, but there are some signs of recovery on the horizon.

According to Japan Airlines (JAL), international air travel has declined 31 percent and domestic travel has declined 25 percent, which is actually less than the airline anticipated.

Meanwhile, Royal Caribbean International, which canceled its Japanese port calls in March, expects to deploy the Legend of the Seas back to Japan as of August 1.

The U.S. Department of State has further downgraded its earlier travel alert, saying that the situation at the Fukushima Daiichi Nuclear Power Plant is “dramatically different” today than it was in March, when it saw “significant ongoing releases of radioactivity.”

The State Department also noted that it’s considered safe to use Japanese trains, such as the high-speed Tohoku Shinkansen Railway, that travel through the 50-mile evacuation zone around the Fukushima Daiichi reactors.

Learn more: State Department Travel Alerts Vs. Travel Warnings

JAL also reports that Japanese outbound air travel has almost fully recovered with both business travel and tourism exceeding projections.

Travel was heavier than expected during the Golden Week public holidays in April, which led the airline to be optimistic that July and August will meet airline expectations.

While Japanese travelers have resumed making overseas trips, inbound travel from Europe and North America has not met expectations. The president of JAL anticipates it will be a long, slow recovery before travel to Japan returns to previous levels.

The airline’s partners, United-Continental and American Airlines, have both reduced the number of flights to Japan.

The airline was experiencing trouble before the earthquake. In January, it filed for bankruptcy and completed a restructuring in March. JAL anticipates a $929 million profit for this year, in comparison to last year’s $2.3 billion operating profit.

New Boeing 787 planes are a crucial part of the airline’s future. The fuel-efficient 787 planes are smaller than Boeing 747s and are being used for routes like the new Tokyo-Boston service that doesn’t currently have the demand for the larger planes.

By Lily J. Kosner for PeterGreenberg.com.

Related Links: FlightGlobal.com, Reuters, Bloomberg, TravelPulse.com, State Department

Related Articles on PeterGreenberg.com:

• Japan’s Aftershocks: Rebuilding Japanese Tourism
• American Airlines Forges Ahead With Japan Partnership, Other Airlines Cut Capacity
• Japan Tourism Plummets In Wake of Earthquake, Tsunami
• Japan Earthquake Damages Tourism Worldwide
• Flights Re-Routed As Japanese Radiation Leaks Affect Airspace
• Japan Earthquake Resources: Aid Organizations, Charities and the Travel Industry Response
• Natural Disasters section
• Japan Travel section