Concerns over the recent coup may be the least of Thailand’s problems. Instead, the country has a new tourism issue to worry about: the credit crunch.
With the eurozone having slid into a recession and the weak United States economy heading further south, the south east Asian nation is being affected by a global shelving of travel plans as consumers fret about jobs and mortgages.
Ministry of Tourism figures showed that arrivals at Bangkok’s main airport were down 21 per cent in September from the previous year’s figures, and August showed a 33 per cent drop over 2007 – although the latter figure was at least partly affected by high fuel costs.
And while airlines’ gas bills may have eased, industry insiders expect numbers to remain low. Indeed, they already look that way: October is officially the start of the high season, but everywhere in Thailand, vendors and service providers are seeing a drop in visitors.
“We will probably have a very bad high season,” Oliver Martin of industry body the Pacific Asia Travel Association (PATA), told journalists. “You’re going to have it across the board. It’s going to be everyone -- from the luxury resort right down to a small tour operator, a mom-and-pop shop or a restaurant.”
The body had forecast Thai tourist growth at four to five per cent this year – a figure that was on track until July. Now, however, the group expects growth to drop to about two or three per cent for the year.
The country’s low international image followed bloody anti-government street protests has been further eroded by a territorial dispute with Cambodia that erupted into a deadly firefight in October as well as a bomb attack near the Malaysian border.
And despite the fact that tourists are rarely harmed – in fact, this reporter found Bangkok both quiet and charming in September – visitors are not usually keen to be caught in the crossfire.
The tourist haven of Chiang Mai in the north has been particularly hit by anti government clashes, and industry groups expect local tourism to grow only five per cent between now and March.
Also affected by this mix of factors has been the country’s medical tourism sector. This is in line with global trends that have seen US visitors put off non essential trips. “We are not predicting robust growth,” Curtis Schroeder, chief executive of Bangkok’s Bumrungrad Hospital told Business Week.
And the chairman of the Tourism Authority of Thailand, Kongkirt Hiranyakit, has warned that this potent mix of factors could lead to a loss of some 70,000 industry jobs, from a total of one million.
As might be expected, the TAT, one of the most active tourism bodies in the world, is already hard at work combating these threats. “Thailand is generally better suited to weather this kind of storm. Because the economy is so dependent on tourism they were very relatively quick to react,” said Martin.
One strategy is to adjust focus to south east Asian markets such as Singapore and Malaysia, which have thus far not been deeply impacted by the global crunch.
An attempt has also been to reach out to luxury travellers who are believed to be insulated from recessions. Both the Mandarin Oriental and the Shangri-La Bangkok, consistently rated among the top hotels in the world, are offering festive year end packages aimed at the super rich.
But with the bulk of arrivals into the kingdom being mass market package tourists, that plan may not help much.
And in October, the TAT organised a lavish party for the travel trade, flying in some 1,000 guests for a week’s fact finding trip, to assure them the situation is normal in the kingdom. “Please convey the message that travellers can travel all around the country and in other areas of Bangkok beside the government’s district without any problems,” the country’s tourism and sport minister Weerasak Kowsurat said at the opening ceremony.
Kowsurat did, however, point out that everyone in the industry would need to work much harder to raise incoming visitor numbers again – tourism revenue this year is expected to fall short of the projected $17.1 billion – but believed it was only a matter of time.
Next year has been declared Visit Thailand Year 2009, and the ministry has rolled out a slew of Amazing Thailand holiday packages and associated marketing efforts.