By Michele Kambas

ANCIENT OLYMPIA, Greece, Sept 1 (Reuters) - Surrounded by charred trees and still smelling of smoke, Ancient Olympia is welcoming back tourists after a fire which almost destroyed the home of the Olympic games.

Firefighters managed to save the archaeological site, but the surrounding area was devastated by the blaze which swept through the western Peloponnese, forcing thousands of people to flee their homes and killing 63.

"When I walked through here the next day I almost wept," says Panagiotis Flessas, a vice-mayor of Ancient Olympia.

The ruins of the ancient stadium and the museum, a modern one-storey white building housing such masterpieces as the statue of Hermes by Praxiteles, are unscathed.

Around them, grey ash covers the vegetation on the ground and some areas have been destroyed altogether. Many trees are charred or singed, although some places are untouched, evidence of the success of the firefighters in beating back the blaze.

This is a sacred site for Greeks, where athletes from otherwise warring cities would gather every four years and compete in honour of Zeus, king of the gods. The first games were held in 776 BC.

The museum and the archaeological site opened on Tuesday, two days after the fire was extinguished in this area, and volunteers who worked on the Athens 2004 Olympics are already regrouping to restore the area.

The fires initially brought tourist bookings to a standstill, but almost a week after the flames here were extinguished, tour buses are returning and the cafes are busy.

"We are not going to be wiped off of the map," said Flessas. "People are a little bit scared. They hear from the media that Olympia burned. The archaeological area did not burn. We are still here and operating normally."

With 500,000 visitors a year, tourism is the key industry in the greater Olympia region, an area of about 12,000 inhabitants. The Peloponnese itself absorbs about 5 percent of Greece's 14.5 million visitors a year.

"I already had my holiday booked. We called the consulate and they said everything was alright so we came anyway. If anything, it's support that these people need right now," said Italian tourist Eric Ramazzotti, 46, a doctor from Bologna.

The torch for the Olympic games is always lit and carried from Olympia. The torch-lighting ceremony for the Beijing Olympics is scheduled for March.

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