DestinationsTrue fallout will come when domestic tourism subsidy ends, say agents.

How long can Thailand's domestic pivot last?

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Despite a 22.4 billion baht (US$0.75 billion) stimulus, the purchasing power of Thais have been weak as economic problems continue to persist pending a Covid-19 vaccine. (Pictured: Wat Phra Singh in Chiang Mai)
Despite a 22.4 billion baht (US$0.75 billion) stimulus, the purchasing power of Thais have been weak as economic problems continue to persist pending a Covid-19 vaccine. (Pictured: Wat Phra Singh in Chiang Mai) Photo Credit: Gettyimages/Boyloso

Domestic tourism will not be a sustainable solution for tourism-related operators in Thailand, given that the Thai government’s tourism stimulus campaign is set to end in January 2021.

Chairat Trirattanajarasporn, president of Tourism Council of Thailand (TCT), said domestic tourism sentiments improved after the tourism stimulus campaign had started mid-July but the campaign would expire come end-January. The purchasing power of locals have been weak as economic problems continue to persist pending a Covid-19 vaccine.

The 22.4 billion baht (US$7.5 million) “We Travel Together” tourism stimulus campaign saw the government subsidising five million nights of hotel accommodation at 40% of normal room rates. These are limited to 3,000 baht per night for up to five nights, with tourists paying the rest of the sum. Like every other destination worldwide, the aim was to pull the money Thai travellers would typically spend on overseas trips into the domestic market instead.

In 2019, Thai travellers spent 400 billion baht over 12 million overseas trips.

“Thai travel agents, both inbound and outbound ones, have to play in domestic tourism to compete for small shares amid high competition to survive,” said Chotechuang Soorangura, associate managing director of NS Travel Group.

Given, tourist destinations did attract Thailand travellers with promotions but it is not a realistic market mechanism. When these end, the real impacts of the crisis on the market will unfold, noted Chotechuang.

TCT's Chairat said more than 20% of travel agents have already closed shop and more tourism operators would be out of business. “Domestic tourism cannot compensate for tourism revenue from overseas markets. We have no idea what to do. We doubt we will survive next year without the full opening of the country to receive visitors,” said Chairat.

Yuthasak Supasorn, governor of the Tourism Authority of Thailand, expected domestic tourism would record 80 to 100 million trips with tourism-related revenue of 750 billion baht this year. If tourism sentiment improves within the last quarter of 2021, the domestic tourism revenue could exceed 1 trillion baht, he said.

In numbers, 2019 saw 166 million domestic trips and the country generated 1.08 trillion baht worth of national income from them. Compared to the first 10 months of 2020, there were about 64 million domestic trips translating to 418 billion baht in revenue.

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