Thailand’s tourism sector has turned a corner, say senior officials

ASEAN Rhythm | Economy | Southeast Asia

In recent days, senior Thai government officials have expressed confidence that the country’s economy has entered its recovery phase, after more than two years of anemic growth due to the COVID-19 pandemic. The main driver of this recovery is tourism, which has rebounded strongly after the devastation caused by pandemic-induced travel bans and quarantines.

according to a Reuters reportGovernment spokesperson Anucha Burapachaisri told local media yesterday that the government expects to earn 2.38 trillion baht (about $64.5 billion) in tourism revenue next year. He expects tourist arrivals to rise again to 32 million, or about 80 per cent of their level in 2019, the last full year before the pandemic.

Since July 1, when Thailand fully reopened foreign travellers, by removing the requirement that they present a negative PCR test before departure, travelers have once again flocked to Thailand’s beaches, temples and markets in encouraging numbers. Anucha said the government is targeting 8-10 million visitors by 2022, marking a massive increase from the paltry 428,000 foreign nationals who made it through the country’s maze of vaccination, visa and quarantine requirements in 2021. In 2020, the country welcomed 6.7 million foreign visitors, most of them before COVID-19 was declared a pandemic in March.

Thailand’s economy, the second largest among the Association of Southeast Asian Nations (ASEAN), is unusually dependent on tourism. While Thailand managed to contain COVID-19 with relative success during the first year of the pandemic, lockdowns and the collapse of international travel devastated the country’s tourism industry. In 2019, Thailand attracted nearly 40 million foreign touristsand the industry generated approximately 20 percent of Thailand’s GDP.

The stagnation of the tourism sector in 2021 was reflected in Thailand’s economy as a whole, which grew by just 1.5%, one of the slowest rates in the region, after negative growth in 2020. By contrast, the improving tourism figures is helping the economy as a whole. . Finance Minister Arkhom Termpittayapaisith said late last week that the Thai economy is expected to grow 3 to 3.5 percent this year, and then 3 to 4 percent in 2023, helped by the reopening of the country to visitors, as well as increased the exports.

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In its latest Asian Development Outlook, released in July, the Asian Development Bank projected that Thailand’s economy grow 2.9 percent in 2022the slowest rate of the six largest ASEAN economies, and 4.2 percent next year.

Despite the recovery so far, the Thai government’s target of more than 30 million visitors next year is optimistic. Before the pandemic, the country relied heavily on visitors from China. In 2019, Thailand welcomed 11 million Chinese tourists, more than a quarter of the total for that year. However, the Chinese government’s “COVID zero” policy has all but stifled outbound tourism, and despite the easing of travel restrictions in certain cities, the immediate picture is unclear.

According to the Bangkok Post, Thailand received only 36,246 Chinese visitors in the first five months of this year, and Thai officials have expressed some confidence that this could rise to 500,000 by the end of 2022. But these numbers remain anemic, compared to the pre-pandemic period.

Whether the Thai government meets its 2023 tourism targets may well depend on decisions made in Beijing as much as in Bangkok.