Tsunami May Cost Thailand 50 Billion Baht In Loss

[george]

Tsunami May Cost Thailand 50 Billion Baht in Tourism Earnings

BANGKOK: -- Thailand will probably lose as much as 50 billion baht ($1.2 billion) in tourism earnings from the Dec. 26 tsunami, much higher than earlier estimates, said Juthamas Siriwan, governor of the Tourism Authority of Thailand.

``At first I thought we would lose 33 billion baht for the whole year, but now I think it may be estimated at more than that,'' Juthamas said in an interview in Bangkok. ``It's around 45 to 50 billion baht in lost tourism revenue,'' plus another $1 billion to rebuild the worst-hit tourist spots.

Earnings of hotels, airlines, restaurants, tour operators and souvenir vendors in Thailand's southwest resorts including Phuket, Krabi, Khao Lak and Phi Phi have plunged since earthquake- triggered waves hit six coastal provinces, killing more than 5,400 people -- half of them tourists. Since the disaster, hotel and airline bookings for the affected areas are down 70 percent, despite successful cleanup efforts, a tsunami-warning system, and a government rebuilding budget of $750 million.

Thailand's government gave the tourism authority an additional 2.5 billion baht this month to help revive an industry that made up 6.4 percent of the country's $164 billion economy in 2004. Juthamas had asked for 3 billion baht, after spending most of her annual 4.6 billion baht budget to restore tourist confidence post-tsunami, including hosting the Miss Universe pageant. The extra cash will be used to market the country as a destination for Asian tourists.

With the budget for targeted marketing, Juthamas said her authority should be able to attract a record of at least 12.6 million visitors to Thailand this year, and ``hopefully'' even reach her pre-tsunami target of 13.3 million.

``Realistically, if we don't do anything it will be less than 12 million, maybe 11.9 million, but if we can inject marketing to particular markets I hope it will increase,'' she said. ``I'm more aggressively looking into marketing to Japan, China, Southeast Asia, Singapore, Hong Kong, Malaysia, to offer them a beautiful holiday weekend.''

Visitor Arrivals

In 2004, 11.68 million foreign visitors came to Thailand -- missing the 12 million target only because of the tsunami in the last week of the year, Juthamas said. Thailand-wide, foreign visitor arrivals are up about 2 percent this year, as people explore other parts of the country including the seaside resort of Hua Hin and the northern city of Chiang Mai.

The tourism authority is using the rebuilding to ``beautify'' the most popular beachfronts, and running promotions together with hotels and airlines -- including Thai Airways International Pcl -- to attract more Thai visitors, and win foreigners back.

Thai Airways will today launch the Beach Queen Thailand 2005 contest, inviting women younger than 25 from all over the world to compete for the title in Phuket and Krabi from August.

Bookings Improve

Bookings for the country's biggest resort island, Phuket, are improving for the peak season, which begins from October, Juthamas said. She expects hotels to be between 60 percent and 70 percent occupied by the end of the year, as tourists from Europe gradually return.

``If you look at the short term, the tour operators, hotels and businesses, they might suffer a lot during the period but if you're looking longer term -- a year ahead -- I think you can see the future is very bright.''

Containing violence including bombings, beheadings and shootings in Thailand's far south is key to avoiding further tourism shocks, Juthamas said.

``I have to knock on wood that they contain the problem in those three areas,'' she said. ``It has clung to that area for over 100 years, I hope they can control the situation as it is -- not beyond that part -- because that would be a big problem.''

Southern Violence

Violence has been blamed on groups including separatists seeking independence for the Muslim-majority area. About 90 percent of Thailand's 65 million population is Buddhist. The tourism authority has ensured key tourism companies are aware that the restive provinces are more than 1,000 kilometers (620 miles) south of Bangkok, and well away from popular areas for travelers, Juthamas said.

Still, the violence spilled over the restive border with the April 3 bombings of Hat Yai airport, a Carrefour hypermarket and a hotel in Songkhla province, 800 kilometers south of Bangkok, killing two people and injuring about 60. This hurt tourism, Juthamas said.

The surge in rebel attacks began after 79 protesters died on Oct. 25 last year from suffocation as they were being transported to a military camp. The government on July 15 controversially approved the use of emergency powers, including potentially limiting personal freedoms with curfews and media bans, to override the existing martial law in an effort to tackle escalating violence in the three provinces.

The government approved the emergency decree after the deaths of two policemen as a result of five explosions and a gun battle on July 14 in Yala. At least 17 civilians were injured.

--Bloomberg 2005-07-19