Thai tourism industry will never be allowed to recover to pre-COVID levels

by Andrew J Wood

 

 

BANGKOK: Last week the Thai government Minister’s speech shows me that tourism will never be allowed to recover to previous levels. The writing is definitely on the wall, windows and front door, that there has been a major policy shift in government thinking by PM Prayut Chan-o-cha’s cabinet. 

 

In a deeply worrying development for Thailand’s massive Travel & Tourism industry, which last year generated a huge Bt 2.2 trillion of income (US$ 55.2 billion), and accounted for 20 per cent of GNP and 10 per cent of all jobs in Thailand, the deputy PM Supattanapong Punmeechaow said that the country relied too much on tourism and that this was unacceptable. 

 

This must be as worrying for property developers as well as investors. If the 39 million tourists that Thailand received last year in 2019, is never to be repeated, why do we need to continue building and investing in new hotels?

 

According to Thailand’s Nation newspaper, deputy PM Supattanapong Punmeechaow admitted that the Covid-19 outbreak had exposed cracks and faults in the Thai economy. 

 

“The Covid-19 outbreak that hit Thailand since April has exposed the fragility of the economy and shed light on the fact that we rely too much on export and tourism,” the Minister said. 

 

This is certainly a departure from what the Minister was saying back in August. The deputy PM, who also holds the Energy portfolio, announced then the formation of a new economic panel, and boasted that the new economic committee will boost tourism and employment. He said the panel agreed to increase subsidies for local tourists and create 1 million jobs in the near future to combat growing unemployment.

 

Supattanapong Punmeechaow the deputy PM is cleary worried about putting too many eggs in one basket and spreading the risk. However it maybe too early to start walking away from tourism when other industries are simple not ready to take up the slack. Infrastructure improvements; legal reforms, changes in corporate ownership regulations and reduced bureaucracy are just a few of the changes the chambers of commerce have been asking for and must be in place BEFORE we start to cook the goose that lays gold bullion on the floor of the vault in the bank.  

 

The deputy PM who was speaking last week at the “Restart Thailand 2021” dinner talk held at Siam Paragon shopping complex in Bangkok said,  “The outbreak has had an especially heavy impact on small and medium businesses, prompting the government to spend over Bt 800 billion on SME aid measures including postponing debt repayment worth over Bt 6.8 trillion for 12 million SMEs,” he said. “However, from July onwards, economic indicators have been pointing toward an improving trend thanks to cooperation from all parties in outbreak prevention, despite some minor impact from the political situations.

 

“The tourism industry has shown improvement, with about 30 per cent occupation, jumping from just 6 per cent in April, thanks to the government’s economic stimulus campaigns such as the ‘Let’s Go Halves’ shopping subsidy,” he added.

 

“Through the Thai Credit Guarantee Corporation, the government is also planning to provide an additional Bt 150 billion in loans to help small and medium businesses.

 

“The battle against Covid-19 is not over yet. The government still has many projects in the coming year to boost the economy, attract foreign investors and build infrastructure for future expansion,” the minister added.

 

“These projects include the construction of 14 Skytrain lines in Bangkok covering 500 kilometres in the next four to five years, larger than London’s Underground, and the infrastructure projects in the Eastern Economic Corridor to support digital technology, 5G and robotics industry.

 

“It is unacceptable to let Thailand slide back to the period before Covid-19. Since the global economy is changing we must be more proactive in attracting foreign investors, and the agencies responsible for this are the Board of Investment Office and Eastern Economic Corridor Office,” Supattanapong said.

 

“The next step will be to put Thailand on the list of top 10 countries with ease of doing business, which is a goal proposed by five countries who are our major trade partners.”

 

2021 will be the year of investment. 

 

The deputy PM further explained that next year the government will focus on investing in new industries that will help reduce reliance on export and tourism. “Bangkok will be the centre of regional offices of multinational companies, while Thailand’s automotive industry will focus on the manufacturing of electric vehicles (EVs), ” he said. “EVs will create other related industries such as smart equipment manufacturing and electricity generating from renewable energy. This will create a great opportunity for Thailand to further invest in community power plants, as well as biomass and solar power plants in Laos,” he concluded. 

 

-- Andrew J Wood 2020-12-21

Wow what a scathing written report. Thailand has just been fried at the Altar and more cracks exposed.  I guess tourism really will die at the hands of this government.

10 minutes ago, webfact said:

2021 will be the year of investment. 

Where will this come from and why here. Who would invest here with this government in power as corrupt as they are.

11 minutes ago, webfact said:

The tourism industry has shown improvement, with about 30 per cent occupation, jumping from just 6 per cent in April, thanks to the government’s economic stimulus campaigns such as the ‘Let’s Go Halves’ shopping subsidy,” he added.

 

so domestic tourism is up 25 % since april ? ahhhhhhhhh we really sure about that one ? 

This gentleman sounds like an intellectual.

Unfortunately, Thailand does not seem to have the overall intellect to pull any of this off.

They will figure out making big money off tourism is actually easy and will revert back to that concept if and when the opportunity arises.

22 minutes ago, webfact said:

why do we need to continue building and investing in new hotels?

That question should have been asked a long time ago. Rebuild the hotels to condominiums,,,,,,, eeeeh wait a minute! 

See. 

I was right.

The glory days are well and truly over.

Akin to the birth of the package holiday in the 60's and the death of the British sea side resorts in the 70's and 80's.

 

Thailand will never be the same again.

53 minutes ago, webfact said:

This is certainly a departure from what the Minister was saying back in August.

country is being run by stupid hypocrites

international tourism is only 11.8%, of GDP. The rest is domestic one.

Unfortunately, thai are not travelling, even as rooms can be found at half price and petrol is cheap, simply because they don't have disposable income.

Probably most thai don't travel at all, except for family reasons, within 100km radius.

Tourism infrastructure is already there (hotels, restaurants, airports, bus, train and boat transport, attractions), so there is no need for any investment.

Tourism is an easy money for economy, 20% of gdp is generated by 10% workforce (yes, workers are underpaid, but it's everywhere in the world)

Why would you doom your cash cows because of a temporary setback? Oh yeah - TITS.

1 hour ago, webfact said:

“It is unacceptable to let Thailand slide back to the period before Covid-19.

What does this really mean in practice? Implement a quota on the maximum number of tourist visas issued? Turn away tourists that want to come and tell them to go to another country? I've never heard of  any place intentionally killing their tourism industry.

3 minutes ago, internationalism said:

international tourism is only 11.8%, of GDP. The rest is domestic one.

Unfortunately, thai are not travelling, oven rooms can be found for half price and petrol is cheap, because they don't have disposable income.

Probably most thai don't travel at all, except for family reasons, within 100km radius.

Tourism infrastructure is already there (hotels, restaurants, airports, bus, train and boat transport, attractions), so there is no need for any investment.

Tourism is an easy money for economy, 20% of gdp is generated by 10% workforce (yes, workers are underpaid, but it's everywhere in the world)

Add in that in a lot of cases, especially the 'less expensive' type of tourism a lot of cheap imported labour was used and some sat back, did nothing and just took the profit. They are probably the biggest complainers now. A lot of Thai job losses are most likely in the supply chains for the industry and relatively unskilled. They are probably the people with the worst prospects.

Thailand’s tourist industry was suffering before COVID. 

7 minutes ago, J Town said:

Why would you doom your cash cows because of a temporary setback? Oh yeah - TITS.

"I fell down and sprained my ankle. Oh well, time to amputate the foot."

4 minutes ago, NorthernRyland said:

12 minutes ago, J Town said:

Why would you doom your cash cows because of a temporary setback? Oh yeah - TITS.

"I fell down and sprained my ankle. Oh well, time to amputate the foot."

 

so in this case they decide to just take the whole leg ?

15 minutes ago, NorthernRyland said:

"I fell down and sprained my ankle. Oh well, time to amputate the foot."

The foot bloody hell the the whole leg...

As of relying on tourism , he is right . No country should ever lay all it's eggs in the same basket , whatever basket it is . That does not mean , tourists won't be allowed anymore . It shifts the rules to other sectors , while tourism was nr 1 before . For example , high speed railroad to tourist destinations , might never arrive . If it is good to attract more tourists it did get a more prio treatment before , while in the future is will change to other sectors , but not ruling it out also .

Lots of rubbish talks from people who desperate to be noticed, i will give a million baht to any one who will predict Accurately  what is going to be this time next week, let alone a month from now...

Not sure why any business would want to invest in Thailand *except for the fact Thailand is (was) a tourism hub*. Take that away and it's just another corrupt country with overpriced currency. It's no coincidence that many Japanese firms have already closed their factories in Thailand - it's easier and cheaper to do business elsewhere. This won't change because one minister wishes it to - unless they actually make major reforms OR mass-tourism is back - there won't be any mass investment either.

3 minutes ago, ezzra said:

Lots of rubbish talks from people who desperate to be noticed, i will give a million baht to any one who will predict Accurately  what is going to be this time next week, let alone a month from now...

The Magic 8 ball says

41 minutes ago, ThailandRyan said:

The Magic 8 ball says

The fortune teller says pay first--then I tell you your fortune....times are tough in LOS Teerak

1 hour ago, internationalism said:

 

Probably most thai don't travel at all, except for family reasons, within 100km radiu

This is very true.

the big difference between people in thailand and people in the west is that the vast majority of westerners can afford at least 1 holiday a year, be it domestic or international.

 

in thailand the opposite is true, the vast majority can just about make ends meet never mind a holiday in a luxury hotel on the beach. The vast majority of Thais are still rural country folk who have probably never been inside a modern hotel, let alone spend a week in one. 

1 hour ago, J Town said:

Why would you doom your cash cows because of a temporary setback? Oh yeah - TITS.

Seems the old cash cow may have been milked dry!

2 hours ago, webfact said:

there has been a major policy shift in government thinking by PM Prayut Chan-o-cha’s cabinet.

Yes, but the big question that they say "never"??? Is he going to be at the helm forever in the great big eternity?

2 hours ago, webfact said:

The outbreak has had an especially heavy impact on small and medium businesses, prompting the government to spend over Bt 800 billion on SME aid measures including postponing debt repayment worth over Bt 6.8 trillion for 12 million SMEs,

Why is it that every SME owner I know has not received a single baht in aid from the Government?

a country where the leaders put almost all eggs in the basket of tourism, look the infrastructure of the country, look around. it was built based on tourism and industry. now both are crashing.

back to agriculture as the mainly source for survive.

3 hours ago, webfact said:

The deputy PM further explained that next year the government will focus on investing in new industries that will help reduce reliance on export and tourism. “Bangkok will be the centre of regional offices of multinational companies, while Thailand’s automotive industry will focus on the manufacturing of electric vehicles

 

So no more auto exports?

 

Great plan. End tourism and exports. What could possibly go wrong?

3 hours ago, internationalism said:

international tourism is only 11.8%, of GDP. The rest is domestic one.

Unfortunately, thai are not travelling, even as rooms can be found at half price and petrol is cheap, simply because they don't have disposable income.

Probably most thai don't travel at all, except for family reasons, within 100km radius.

Tourism infrastructure is already there (hotels, restaurants, airports, bus, train and boat transport, attractions), so there is no need for any investment.

Tourism is an easy money for economy, 20% of gdp is generated by 10% workforce (yes, workers are underpaid, but it's everywhere in the world)

I would suggest you pay a visit to your local train station or bus station where you will find the majority of buses are full going to destinations all over the country so you are incorrect with the statement that most thai's don't travel

4 hours ago, webfact said:

The deputy PM further explained that next year the government will focus on investing in new industries that will help reduce reliance on export and tourism. “Bangkok will be the centre of regional offices of multinational companies, while Thailand’s automotive industry will focus on the manufacturing of electric vehicles (EVs), ” he said. “EVs will create other related industries such as smart equipment manufacturing and electricity generating from renewable energy. This will create a great opportunity for Thailand to further invest in community power plants, as well as biomass and solar power plants in Laos,” he concluded. 

He is right. EV is the industry of the future. look at tesla - 16000% return over 10 years.

Thailand should invite Elon Musk, Tesla's founder, to start a new electric space ship company

in thailand, and to make it easier on him, to give him and his family

free I-SMART  visa with  work permits...

 

It is like in deciding that Pattaya should turn into family friendly holiday resort.

One day they decide it, next day they publish it, day later they build few gardens, and viola - a sin city

turned a family resort overnight !!

 

But i really do appriciate the sincere will to improve Thailand, and the visions and ideals. Unfortunately

it is a bit more complicated than few announcements to the media.

 

I'm sure other countries don't mind taking over the tourists. 

 

In a year when most people has received their shot, the urge for travelling will explode again. 

 

Tourism will always survive on a globalised planet if each country has something nice to offer, and a virus is not going to stop that in the long run. 

Maybe it will alleviate those long immigration lines @ Suvarnabhumi 

that should help the little insulated cartel out.