A Lousy Tourism Year

[Georgie-Porgie]

I have a successful business in Northern Thailand. In years past, I would often listen to other business people telling me how things were "off" this year and that "last year was much better", and wonder what they were talking about; up until now my livelihood has kept growing stronger every season.

My guess is, that one reason for this, is, I keep pumping money back into the company to improve the stock, comfort and attractiveness of my retail shop every year. Another important factor is that a large percentage of my customers are backpackers and sex-tourists.

I feel that when we, anyone selling products or services in Thailand, have problems with things like wars, terrorists and SARS, backpackers and sex-tourists are the only customers that we can really rely on; they always return, and if you have something that they want or need, they will pay for it. This is something that Thai authorities really need to consider if they ever want tourism to become a reliable source of foreign currency.

By the way, the product that I sell is something quite common that everyone has in their home, nothing to do with sex or drugs.

However, the last year has been a tough one. Besides all the problems coming from outside the country that effect tourism, taxes have doubled for many of us foreigners, visa prices have gone up considerably, and the Government has instituted a bunch of new rules for us that have many businesspeople worried.

This is also the first year that my profits during high season have only risen slightly, and, about a month ago, I started to wonder if all my competitors were finally starting to affect my bottom line.

I began watching their shops at different times during the day and evening and noticed that they did not have any more shoppers than before, in fact it seemed that they had less; If I were stuck making what I did last year, they were actually losing money compared to before.

I asked some of the most popular restaurants and businesses in town how they were doing compared to last year and they all said that their profits were down 25% to 50%. I also went around and looked into their businesses to see for myself, and compare the number of patrons with other years. I noticed that the most successful restaurants were usually almost empty to half full during prime hours, but I can remember that, even last year, they were always full, with people waiting outside to get in.

Now, I can think of many reasons for middle class businesses to have problems this year; SARS and all the rest, but what has happened to those unheralded saviors of Thailand's economy, backpackers and sex tourists; the customers that keep coming, no matter how shabbily they are treated?

As far as sex-tourists go, it is pretty obvious to anyone why they are getting fed up. If it isn't another silly crack-down, it's forced drug testing, the lack of topless shows at Nana Plaza due to Government interference or maybe just the ridiculous beer prices there; we might be right on the verge of legalizing prostitution in Thailand; the best thing that could happen to Thailand's reputation AND Thailand's economy, and the highest spending, most consistent tourists are still being harassed for patronizing highly visible businesses that are deeply ingrained in local culture and that operate everywhere throughout the country.

But how about my faithful backpackers? Could they have been put off by all the Thai authorities declaring, it seems almost daily, that they want a "better class of tourist" (no matter that the type of traveler that they mean is much, much happier touring Europe and very unlikely to ever spend a lot of time here)? I do not think so. They are use to abuse. I think the real problem this year stems from the whole Visa Agent debacle. Right before the Loi Katung holiday and the beginning of the tourist year, The Lonely Planet Web-site and much of the internet was filled with horror stories about budget tourists being arrested, doing time in horrendous Thai prisons and then being banned from entering The Kingdom for the rest of their lives. Doesn't exactly motivate one to keep on planning one's holiday in Thailand, does it?, and if you are one of the tens of thousands of people who used those visa services in the past, it might make you very hesitant about returning here with those stamps in your passport - ever!

In my opinion, if it does not change its attitude soon, Thailand is taking the exact steps that will kill the Golden Goose of tourism; Targeting their most faithful customers as undesirables, and making life very difficult for the hard-working Farang residents and entrepreneurs who have helped make Thailand such a desirable place for tourists to spend a lot of time.

After tourism is ruined, then watch what happens to the economy.

[plachon]

I was in Chiang Mai a few days ago, and thought the streets looked pretty packed with grockles, though lots of bars and resturants were half empty or worse. I asked a few local shopkeepers how business was compared to this time last year and they mostly had tales of woe to tell. It was not so much that numbers were down they said, but just that the tourists were spending less. However, nobody I talked to was able to point out one, what seemed to me rather obvious point i.e that there are now far more small businesses selling everything under the sun than ever before. Shops, stalls, restaurants, massage parlours, bars, you name it, CM has the lot. Which is great for the buyer, as prices are cut throat and highly competitive, but not so good for the seller who in the past has relied on less competition to make ends meet. The logical market conclusion to all this is that the weakest will be forced out leaving only the strongest, but this being Thailand, there always seems to be a never ending queue of new small entrepreneurs ready and willing to lose their shirts in the market place. So the situtation may not improve for some time I'm afraid Georgie, farang master seller or not. And yes, I'm sure a lot of long term regulars and past-faithfuls will have been put off by the draconian visa measures but in place by Cap'n Shinsible this year.

[djinn]

I live now in Naklua and when I go to Pattaya I notice some differences with the same period of the year in 2002:

during day time:nobody on beach road During the night;only some small traffic jams.Less big busses charging packs of asian tourists

Bars half empty all around.

And we read everywhere hotels are fully booked for the end of december

I doubt......

[taxexile]

maybe the thai authorities are getting a bit tired of the large number of european/american tourists who abuse the hospitality,offend thai moral codes of dress and behaviour and break the law here.

there are many tourists from s.e.asia,japan,china,korea etc. who not only have time and money to spend but are less likely to behave in a way that offends thai sensibilities.

over the next few years for every falang tourist that doesn't return,i reckon two or three asians will take their place.

i wouldn't be so quick to condemn the crackdown if it can prune the number of "low-end tourists" swamping the country. i have walked around chiang mai in the high tourist season and its not very pleasant. obese and ill mannered euro-trash fight for space with bored thais selling all kinds of worthless crap. holier than thou backpackers constantly suspicious of being overcharged, quoting lonely planet prices chapter and verse. that awful book should be banned.

it removes all vestiges of discovery and adventure from what should be a true adventure.

if this is the future of tourism then you can keep it. no "high end" tourist would put up with it, and nobody in search of some adventure and surprise would want to return.

increase the prices and cut down the numbers. quality not quantity. send the euro-trash to the spanish beaches,back where they came from. or bring in the japanese and chinese tourists, at least they have dignity and manners and know how to behave. restrict the backpackers to koh phangan and the sex tourists to walled enclosures in pattaya and patong and leave the rest of the country to the peaceful wanderings of those travellers genuinely wanting an enjoyable adventure.

if only.

i believe the thais fear for the dilution and poisoning of their culture, and dont want the worst of the falangs and their ways anywhere near their beloved thailand.

and who can blame them.

but they may have to forgo a proportion of the tourist $.

[en184]

One reason tourism is down, is that airline operators have cut flights and increased fares.

I tried to get a flight ot BKK at christmas, 2 months ago, and was told all airlines fully booked in economy.

If tourists can't get to thailand, they may head elshewhere. Brazil, South America, Vietnam, Philippines.. All good alternative destinations.

Plus, Bar girls are less friendly than before. The economy is doing well, and they don't seem to appreciate farangs any more.

This change in attitude of bar girls is the real reason sex tourists are not returning..

[sbk]

Actually taxexile, usually your obese ill-mannered tourists are your high-end tourists! And yes, there are your annoying backpackers with that horrible lonely planet book (agreed! it should be banned!) but all in all, most of them are generally alright and do spend their money in places that affect the local economy more than the high end tourists or sex tourists. Let's face it, high end tourists only spend their money in big expensive hotels owned by multinational corporations, thus turning thai people into employees in their own countries. Sex-tourists pretty much just spend their money on women thus contributing to the burgeoning prostitution industry (I won't even go into their contribution of STDs), while backpackers usually stay in small, locally owned places and spend their money in small locally owned businesses. OK, yeah, you gotta deal with their stinginess, but in the end, I remember reading somewhere that the average backpacker spent more time and money in thailand than the high end tourist. And as for the asian tourist, where did you get the idea that they are more sensitive to local culture??? Not from anything I have ever seen!

Is business down this year in the south? Well, hard to say as the weather has been terrible this rainy season and people come to the beaches to sunbathe, and also there has been a tremendous building boom on the island with many new bungalow resorts being built thus increasing competition. But, well, yes, so far, it seems down. I don't think it can all be laid on Taksin's doorstep, it is most likely a multitude of factors. High ticket prices, smaller number of flights, increased visa fees, the Bali bombing, etc etc. I think it all adds up to lower numbers of people.

[Khun ?]

Quality and not quanity is rightful said. A back packer that spends only on cheap food, transport and accomadation cost more on resources than he spends and the only one that made anything is the airlines. Plus with the amount now choosing to stay long term in Thailand has had a negative effect on quality vacationers and retirees. How can anyone say that someone who spends 40,000 Baht in 3 months is better than a quality vacationer from the west who will normally spend hat much

in a week or 2. None of them are really minded except the ones that will not move

on in due time.

How can it be assumed that a cheap hotel that makes a profit of 200 baht a day per customer that works the employees 7 days a week at low pay are better for an economy than one that pays its employees decent wages and some benefits and more employees not better for an economy. The big hotels sell more package tours at better prices and do much more for the economy than a mom and pop hotel that the customer walks ever place he goes only goes on cheap tours if any and only eats 100 baht meals and remains a stigma that keeps many more quality vacationers away. Resources are not endless in Thailand like cheap labor.

[Pablo H]

Sbk,

having read some of your previous post's, I gather that you live and have a business on Ko Pagn Nagn.

I spent some time there in the past and thought it was the ideal place to get away from all the mainstream tourist areas and relax. I used to like the fact that in order to get to certain parts of the island you needed to be pretty useful on a motorbike (ton nai pan) or you would need to take a longtail boat (haad Kuat), forgive the spelling please!

Anyway just before I left the island, much to my dismay, I noticed lots of construction work taking place. They were even starting to pave the roads in the north and east. Why? I guess they were making the island more accessable to the more "high-end tourist's".

I know the place was not perfect, but I think it was better off the way it was (plastic hippies included) than it ending up like the "gutter" which is Ko Sumui.

What do you think?

[dr_Pat_Pong]

MIGHT terrorism and SARS have had some impact for 2003 ?

[p1p]

Business currently reasonably OK, if down from last year. Hoping to move into a business where I don't have so much tied up and such high overheads. Staff - rent - consumables etc.

Sincerely worried about the future here.

[Georgie-Porgie]

SARS and terrorism are sure to bother upper and middle class travelers, maybe even a few sex-tourists, but it takes a lot more than the mere threat of these things to stop the back-packers from piling in. Last year, after Bali, the numbers of back-packers entering Thailand went up, effectively replacing their more well-off brethren, and believe me, plenty of them spend money on scale with any other type of traveler. The main thing that they scrimp on is hotels. They feel it's foolish to spend $100 dollars a night on a place that they are only going to sleep in. Of course there is a percentage of dirtbags scattered amongst them, but in general they are nice middle class kids trying to spend their travel money wisely, not just throw it away. Who can blame them?

[Guest IT Manager]

Backpackers stay in-country longer than so called hi-end tourists.

A high end tourist stays at a top flight hotel and pays foolish amounts for accommodation. That come into the Thai economy via corporate taxes paid by the hotel and VAT. Profit is repatriated or recycled into the building.

A backpacker stays at a guest house, income to the country goes to the guest house owner and wages to the staff. Some via tax, to the economy.

If you ask me, though scales are different, the likelihood is that the backpacker and the Hi-So tourist put as much into the economy as one another via taxes where applicable, on a per capita basis.

The backpacker stays 3 months or 12 months. The high so, Porsche at home, "darling pass the strawberries", is here a week then gone, and forgotten, next please.

The backpacker may smell bad, look stupid and read that awful book, but they do it for months on end, all over the country.

Now which one was bad for the economy, or which was less worse maybe?

Edited December 14, 2003 by IT Manager

[en184]

I am one of the mid range tourists. Typically, I will spend 3-4 weeks a year in thailand and spend up to 100,000 bhat during the period.

Many people benefit, girls, restaurants, taxis, motor cycle hire, shops, night clubs.

But, when the price of a flight rises to 50,000 bhat, from europe.. this kills the decision to travel.

[sbk]

well, IT and Georgie, I am obviously in agreement with you, I would rather see the money go to the locals than to a big corporation. People where I live are fiercely independent and would not do well (nor would their local culture) if everyone were employed by some large corp. that treated everyone like faceless worker bees. I guess, coming from the US where this is the norm, I kind of like the proliferation of mom & pop guesthouses in thailand and do not necessarily think big companies are the best way to go. They may pay more but most of the places patronized by backpackers are family owned, thus actually supporting a larger segment of the population. Yes, there are annoying, dirty backpackers but I agree with Georgie, largely they are middle-class kids who have worked (or are travelling on mom & dad's money, nice if you can get it!) and plan on spending a minimum of 3 months in thailand.

Pablo, some roads are being paved and there is alot of construction but the biggest problem on this island is the proliferation of bars and bar girls. Three years ago there were none. Most of these girls show no respect for the locals, play their music loudly in residential neighborhoods and often rob the farangs they are after. Alot of the construction you saw were illegal bars opening up in residential neighborhoods, all making payments to the local police. Am wondering how long it will be before things blow up here, southerners aren't the most noted for "jai yen yen" if you know what I mean. One of my neighbors is having difficulties with girls from a nearby bar stealing the fruit from the trees around her house and they have a large dog that chases her and tries to bite her every time she turns into her driveway. She tried asking nicely, but it didn't make a difference. Wonder if these girls understand the Southern Thai code of behavior? Koh Phangan is still largely a very rural place and local people aren't ones to turn to the (on the make) police for help in solving their problems. After 15 years of changes I would have to say the past two years have wrought the worst changes here, paved roads being the least of them! And BTW, you still need a motorbike to get to Thong Nai Pan and a boat to Haad Khuat. Every time they try to fix that road we get a massive rainy season (like this one) and another massive mudslide turns it back into 4 wheel drive territory.

[eric1000]

One reason tourism is down, is that airline operators have cut flights and increased fares.

I tried to get a flight ot BKK at christmas, 2 months ago, and was told all airlines fully booked in economy.

If tourists can't get to thailand, they may head elshewhere. Brazil, South America, Vietnam, Philippines.. All good alternative destinations.

Plus, Bar girls are less friendly than before. The economy is doing well, and they don't seem to appreciate farangs any more.

This change in attitude of bar girls is the real reason sex tourists are not returning..

snip

its always been difficult to get flights at christmas some regulars book in march for a christmas trip

lets face it thailand is just not good value any more compared with other places.

and europe is in recession Germany especially ,folks can always get a cheap flight

and spend very little on daily outgoings

[Butterfly]

There is a more simple reason for that

Exchange rate in 1996/1997 for $1 = 25 Bath

Average Price increases since 1997 = 100% (more on some products)

Current Echance Rate for $1 in 2003 = 39 Bath

Current Exchange Rate adjusted for Inflation for $1 = 20 Bath (39/2)

Expected Echange Rate for $1 if things were to be equal (1996) = 50 Bath

Therefore tourists are being screwed by 25% on prices and Thailand is 25% more expensive. That does not go with backpackers for sure.

A Thai friend of mine who operate a small Thai restaurant in a tourist place told me that he "was making more money when Thai bath was only 25 bath for $1"

Never underestimate the power of currency exhange.

This will have an impact on all export (above all the Schrimp business export to the US) so expect a major slow down next year.

[maerim]

If it's not a personal question but where do you put all these baths?

[dr_Pat_Pong]

In his bathroom of course.

[maerim]

Must be some kennel, 2 bedrooms and 685 bathrooms.

[Guest IT Manager]

Bet he's clean however.

[Khun ?]

One word will sum it up Economics.

Anyone and everyone use to be able to save in a few years 10G or 20G working

in the IT field or investing in the high tech areas. This gave many a decent vacation and where to, of course the exotic Thailand. How many of these never left and end up marrying or homesteading with a local and start up a mom and pop shop preying/surviving on all these .com/high tech investors young vacationers/backpackers. This become common place in Thailand from the Mid to late 90's young people with easy made cash even the parents had money to throw at them so they could run off on an exotic Thailand vacation you know kind of a

reward for doing the university thing.

This brings the present condition ( anyone that can make it to a border once a month or every three months to the lucky ones with a few baht-barts in their pocket is doing so). You cooked your own goose. How many smart people do you know back home that would of quit work and try to making life long living on a small amount of savings (none). This has turned off many upper middle class and above tourist and retirees and another fact many in the upper class without getting things exactly their way would rather not be such a long flight away from the summers back home. Sanuk is only one factor for them because if you have the money there will always be sanuk. The Thai government has to make a choice and is now doing so to include the much income induced Asian region (Japan and China mainly). Projected 12 mil visitors this year of course no china man is going to buy much from a place with a farang hanging around it. Comments please as this is the way I see it. For a bit of insight I only come once a year 1 or 2 months at a time. I very seldom pay more than 1000 baht for hotel and I spend about 80G baht a week. I never buy gifts or gold and most of my time is with thai friends going here and there just having a grand old time. Nights out with up to 10 or so friends

eating drinking and just about anything we want to in the short time I have and yes I do pay the check most of the time and once in a while will let them pay.

All sides of the story will differ.... One thing how many people a week just on this site alone are trying to start a small business or looking for work in Thailand. I see a continued problem if some restraints are not set forth soon and this does not take into consideration of other asian countries doing the same. Loa farang mean anything to anyone.

[Guest IT Manager]

Did you mis-type or did you really mean 80,000 baht per week? Whatever is it possible to spend that much money on, if you are in-country for 2 months per year?

Two weeks per year I can see it, I just don't know what you could buy in that time. Just interested mind you.

Does it include night wives or just drinking/eating etc?

[Khun ?]

Yes 80,000 baht a week but this includes sanuk for the friends and drinks and

food and normally not at cheap places plus golf for the group and hotels, trips to islands, whatever when ever. I know it is to much but when you work 7 days a week and no time for sanuk at all to include not even a beer once in a while it is easy to go overboard a little. The favor will be returned in the future as I am considering retiring soon and my friends are already building me a little place to live (when I am not traveling) on their property at no cost to me.

It is in a very high cost area around golf courses and just a bit outside of town.

What comes around goes around.

[sbk]

Actually, I live here because my husband is from here, not because I think it is a great place to "get away from it all". I am not running away from anything but choosing to live in my husband's home. People make these choices all around the world. And no, I don't know too many of these people as you describe them. A few here and there but not hordes as you make it sound. And why is running your own business "preying"? I am nowhere near retirement age so why should I stop working? I employ Thai people in my business, spend my money locally and put alot back into this community. How does this make me a predator?

As for the Chinese/Korean/Japanese tourists, they are generally very demanding and arrogant (or in the case of young japanese, stoned out of their skulls) and do not spend that much because (except for the japanese) Thailand is not that much cheaper, or in some cases is more expensive than, their own countries. Too bad there isn't some kind of study to break down spending habits among nationalities. After living in Taiwan, I wouldn't put the Chinese at the top of the big-spenders list.

[taxexile]

As for the Chinese/Korean/Japanese tourists, they are generally very demanding and arrogant (or in the case of young japanese, stoned out of their skulls) and do not spend

are you based on one of the islands?

although not questioning your observations,the koreans, chinese and japanese that i have encountered in bangkok have been

for the most part well behaved and well mannered and respectful towards thai mores, and will spend to eat well and have fun.most of the arrogance i have seen comes from europeans and americans.

[Khun ?]

SBK

You are of the few farang if you are, that have a THAI HUSBAND legally. Anyone that is mainly in business to make money primarly on tourist is a predator there of.

Regardless if better words could be used it is an animalistic correct term and is

in a person who decides to stay in a foreign country to make a living off as the main customers other foreigners. I am sorry about my miss stated fact of Thailand having visa problems with foreigners and unregistered foreign workers or

10 year tourist. It is all speculation on my part, excuseme. I find it hard to debate the issue with you as you are considered as having an elite card by birth and you require no income that I am aware of to get your visa for a long term stay. You need to get off Samui more if you have not noticed the abundance of Farangs living in Thailand now and the amount of those trying or wishing to do so presently and in the future. I wish I had a thai lady with the money to afford me the priviledges you have but the fact is it is about as rare as your situation (farang female and Thai husband.. Rich chinesse are as anti farang as you are anti cheap asian. Good Luck in your business

[Guest IT Manager]

Tax try working in a mid-range Hotel for while. Soon fix that. Sure the Europeans are demanding but they are made to look like school boys and girls by the Japanese guests who are demanding, rude and volatile on occasion.

Koreans usually cool and the Chinese wonder how they can get to live here.

[sbk]

Very charming Khun, sorry you are so bitter about my so-called free ride. I don't think my life here has been easy nor do I think that you are in any position to judge me. Ever heard the phrase "to walk a mile in another person's shoes"??

Yes, I am a legally married farang woman, we just celebrated our 14th wedding anniversary and have lived here for 15 years. Life is never simple for an expat and is most likely harder for an expat woman, especially in such a male dominated society. BTW, my husband does have income requirements, same as farang men. In this country the man is the one who is supposedly taking care of his family. Since he is obviously legally allowed to work and does run our business, then we don't need to jump through all the hoops farang men do. But all that does not in anyway justify your ridiculously rude posting. I suggest you try a little less speculation and a little more introspection.

Tax and IT, a bit more to the point of the post, I am on (ooh the dreaded backpacker haunt) Koh Phangan. We get lots of people from all over the world, not just Europeans, North Americans and Israelis. Yes, they are mostly young, but mostly ok. Enough are a pain but backpackers are alot less picky and demanding then the higher end tourist. And they do put their money back into the community where they stay, far more than the high end tourist does. I've found (after living in Taiwan) that the Chinese can be very pushy; one of my singaporean chinese customers said it to me first! And back to the original point of the post, business is down here, could just be people are moving on, most backpackers aren't interested in sex tourism and most find it repellent, so the proliferation of bar girls on the island may have something to do with it. Again, I think it is many factors accumulating into slack business and I don't think the Thai govt should rely on Asian tourists as their newest goose with the golden eggs.

[maerim]

If I rememeber correctly I read a story when I was kid ( yeah what a memory) about a goose and a golden egg.

How did it go again?

Oh yeah something to do with omlettes or was it bumping the goose off?

Politicians come and go, not fast enough in my opinion but the legacy they leave behind has to be sorted out by ordinary people.

[Georgie-Porgie]

I also fail to see how running a business that has mainly foreign customers is "preying" on anything.

In the United States, businesspeople who import genuine foods and ingredients for Asian foodstuffs, mostly foreign residents and immigrants, are considered to be clever entrepreneurs, making the U.S. a more comfortable and friendly place for visiting foreign businesspeople, investors, Asian tourists and immigrants, and for the many Americans who simply love Asian food.

These importers are looked on favorably by the country, not spit on as some kind of parasites "preying" on tourists.

One of the reasons that Thailand is considered to be such a dynamic tourist destination is because of the comforts found here. Good food from all over the world is definitely a comfort and because of foreigners who want to live here, the Kingdom has excellent restaurants specializing in every kind of cuisine.

The planet is a small place now, and most moneyed travelers and businessmen don't feel comfortable without access to finely prepared foods from home, and elsewhere, if they are going to spend any time somewhere.

Let's face facts, Thais make great Thai food, but they, generally, are not so hot at quality foreign food, without a expert foreign cook around to taste the food and keep it up to snuff (except Art Cafe, Chiang Mai ).

The truth is that Thailand needs foreigners that love Thailand and want to stay here, as much as we need Thailand!