NACO, Sonora - After a May 16 drug cartel-law enforcement shootout in Cananea and Avispe, Sonora, left 23 people dead, the flow of U.S. shoppers to this border town 40 miles northeast of Cananea dropped significantly, local business owners say.

Now three weeks later, they say, those shoppers are still hesitant to return - despite the fact that there has been no further violence in the region, and that the violence in Cananea never spread to Naco.

"Any time there is an incident, or rumors of an incident, people stop coming," said Sixto de la Peña, a physician who runs a private practice as well as the San Jose Discount Pharmacy.

That, he said, causes problems for businesses like his that depend on customers from Arizona. Nearly two-thirds of his clients are Americans, De la Peña estimated.

At Quality Dental Care on Calle Madero, Naco's main thoroughfare, business from the U.S. is so important that the firm's name and advertising are all in English. Assistant manager Eileen Valenzuela said that at least 80 percent of the patients at the dental clinic are Arizona residents.

But since the May 16 incident, she said, the number of new customers from the U.S. has declined, while some regular patients have canceled their appointments.

"They call and ask if it's safe to come over to Naco," Valenzuela said. "People (from the U.S.) are scared, but there's nothing bad going on here - the incident happened 50 miles from here. So we hope it's a passing thing."

Sierra Vista resident Susette Hayes was the lone person seated in the clinic's reception area on Tuesday afternoon as she waited for her daughter to complete a dental exam. Hayes, who has been coming to Naco with family members for the past year to take advantage of the city's low-cost dental care, said she was well aware of the violence last month in Cananea.

Even so, she said, she had no reservations about coming back to Mexico.

"At least not to go this far," she said, adding a trip further south into Sonora would probably have made her anxious.

Around the corner at the El Maguey restaurant, manager Isaac Cordoba estimated that the majority of his customers before the May 16 incident came from the United States. Now, he said, that number is "way down," possible to only a quarter of his total business.

And while Cordoba hopes his U.S. customers return quickly, he doesn't blame those who have been scared away.

"Look at what's happening in this country," he said. "The mafiosos are now in control of Mexico."

Naco's public security chief, Juan Alberto Bracamonte, insisted that despite what is happening elsewhere in Mexico, his town has remained safe.

"The only thing that happened in Naco was that people panicked about a rumor," he said. "In fact, we haven't had any significant criminal incident in Naco for more than four weeks. Visitors from the United States are completely safe here, and as police commander, I guarantee it."

De la Peña, the physician and pharmacy owner, thought the slowdown in business from the U.S. is due as much to the rumors that followed the incidents at Cananea and Avispe as the events themselves.

Two days after the May 16 shootout, a prank phone caller warned officials in Cananea that a second drug cartel hit squad was headed for the city. After Cananea Mayor Luis Cha Flores responded by ordering a curfew, a new rumor spread that the gunmen were headed next for Naco.

By the time the rumor reached the Arizona border, it had grown to include a fictional shootout in Cananea in which at least 100 people had been killed. U.S. Border Patrol agents armed with rifles took up positions on the rooftop of the port of entry in Naco, Ariz., and Maj. Gen. Barbara Fast, commander of Fort Huachuca, ordered military personnel to stay out of Mexico's border towns and advised Army civilian personnel to do the same.

Meanwhile, news media outlets, including CNN, flashed bulletins on the Internet and TV reporting that the local U.S.-Mexico border had been partially closed due to fears of spreading violence. The Herald/Review posted regular updates on the situation to its Web site.

Later that day, officials on both sides of the border acknowledged the rumors had been a hoax.

"The authorities in the U.S. scared everybody over there," De la Peña said. "So people stopped coming, even when the rumors weren't true."

Bisbee Mayor Ron Oertle also thinks that American officials and news media unduly frightened the local public. He is urging residents of his town to return to Naco and support the neighboring economy.

"It's good international relations when trade relations flow both ways," he said.

De la Peña agreed, noting that just as Arizonans come to Naco for affordable prescription drugs and affordable dental and health care, residents of his town go to Arizona to buy appliances, electronics and groceries.

"Imagine if something happened over there to make people from here stop going to Safeway," he said, motioning toward the Bisbee supermarket that lies within sight of Naco. "It would be very difficult for them."