- Photo: 2020

The Thai Tourist Industry Wrecked, Despite Success in Controlling COVID-19

By Pattama Vilailert *

BANGKOK (IDN) – On New Year’s Eve of 2020 when the Chinese authorities alerted the World Health Organization (WHO) of strange pneumonia cases in Wuhan City, Thailand’s tourism industry, the country’s primary gross domestic product (GDP) driver, was facing an unprecedented boom. But, six months later, the industry is on its knees with knowledgeable sources predicting a lengthy recovery period.

According to the Ministry of Tourism, Thailand’s Tourism Revenue reached USD 62 billion in 2019 and USD 58 billion the previous year. The growth of international arrivals has increased every year; in 2019, the country received 39.8 million tourists, and 25 per cent of them or ten million were Chinese tourists. Around 900,000 Chinese are estimated to have visited Thailand monthly and spent about USD 1,572 a trip. Last year, Chinese visitors spent almost USD 18 billion in Thailand.

The Tourism Council of Thailand reveals that the tourist industry constitutes 20 per cent of  Thailand’s GDP. Some 7.7 million Thais work in tourist and its related industries. The impact of COVID 19 pandemic on Thai people and the tourist industry is tremendous.

Since the first confirmation of a case in Thailand on January 13, 2020, the country has been dealing with the outbreak. The first local transmission was confirmed on January 31, one day after the outbreak was declared a Public Health Emergency of International concern.

The first cases found in Thailand were Chinese who have flown in from Wuhan, along with them, the first local transmission was a taxi driver who had never been to China, but had driven Chinese tourists during the early outbreak-spreading period. 

Throughout February, the number of cases remained low and limited to people who had direct contact with tourists. However, the outbreak frightened the whole country in mid-March when a sharp increase was seen. As happened to other inflected nations, the crossed clusters transmission was unavoidable. The confirmed cases rose to over a hundred per day, so public venues and businesses were ordered to close in Bangkok and other provinces.

The first Declaration of an Emergency State Situation was announced on March 26 to handle the outbreak. The Centre for COVID-19 Situation Administration (CCSA) was established in March to update the situation and communicate government orders to Thai people and the country’s residents. 

The closures have impacted most sectors of the Thai workforce, but more so the 7.7 million Thais working in tourist and its chain industries. The despair among the population was widespread.

While CCSA attempted to control the outbreak at full force encouraging citizens to wear a mask and keeping social distancing, thousands of people fled Bangkok for provinces in buses after the order for business closures. They headed to their hometown where rice and vegetables are grown, and home is not rented. It was better than having nothing to eat and nowhere to live in Bangkok after being laid off by the COVID-19 crisis.

Ban on all incoming flights to Thailand came to effect on April 4. At that point, Thailand had reported 1,978 COVID-19 cases and 19 deaths and wanted to avoid importing more cases.

< Deserted Yaowarat (China Town), a most favourite attraction for Chinese tourists. March 16, 2020. Credit: Watcharapong Luengarunsiri.

Thailand can be seen as one of the success stories in controlling the COVID-19 pandemic. Since May 3, the number of new Covid-19 cases reported daily had been in single figures, and ten days later, no evidence was found in Thailand for the first time. Throughout May, numbers of cases have been in single digits and most new cases were Thais who had been in state quarantine after returning from infected countries.

Thailand’s success prompted Andreas Gandzior of the German online publication Berliner Morgenpost newspaper to write on April 13 that the German government should learn from the Thai government in dealing with the COVID-19 outbreak, by employing vigorous, consistent and strict measures. On April 14, WHO praised Thailand for having a sound healthcare system and a million-strong public health volunteer force.

“The WHO complimented us for a good family healthcare system and 1,040,000 village health volunteers, resulting in a huge group of people who can take care of patients effectively, which is considered one of Thailand’s pride,” Taweesin Visanuyothin, spokesman of CCSA told The Nation newspaper.The Village Health Volunteers project was established in 1977. They have knocked on at least 12 million doors and found that 600,000 people are at risk of contracting COVID-19.

But, it is a long road to transform this success story in reviving the devastated tourism industry. It depends on many factors outside Thailand’s control, such as the resumption of international travel and lower infection rates in source countries of tourists. By the end of June, it is possible that most businesses in Thailand will reopen with new normal conducts.

Besides, relaxing the lockdown measures, the government came up with Rao Mai Thing Kan’ (We Do Not Leave You Behind) scheme to give a subsidy of 5,000 baht (USD 157) per month for three months. In early May, 28.8 million people applied for the subsidy. But the Ministry of Finance says that only 15.1 million Thais have been paid, while 7.03 million are not qualified for the scheme and 1.7 million couldn’t get through the registration system. Subsequently, a significant number of affected citizens have been left behind

Supaporn, an employee at one of the leading international travel agencies in Thailand, told IDN that the company had already laid off 250 employees since early 2020 to save cost. As of May, 50 per cent of her salary has been cut off. Related service providers like tourist guides, car rental and restaurants could not run their business either.

Chaipat Mai, Grab driver agreed, he stopped driving Grab in January when there were few Chinese tourists, at the time, he didn’t know what kind of outbreak it was, but he learnt that most infected cases were Chinese, so he ceased the service.

Supaporn’s company targets high-end tourists from Europe and America, and German tourists have already cancelled their July trips. The company may need to shift their target markets to Asian and domestic ones in 2021. But it might be challenging to tap these markets as other travel agencies have served these markets longer than her company.

The central bank has forecast the economy will contract 5.3 per cent this year, which would be the weakest performance since the 1998 Asian financial crisis. Meanwhile, foreign investors are believed to be targeting Thai resorts for take-overs.

Sombat Atiset, CEO of Katathani Collection of Resorts, revealed to Prachachat Turakij newspaper on May 30 that he learnt about foreign investors with substantial funds and their interest in buying a large number of hotels in Thailand. At the moment, five-star hotels priced at 5-6 billion Baht (USD 160-190 million) or small hotels at 100 million Baht (USD 3 million) are on sale in Phuket, Samui, Krabi and Khao Lak, the high-end tourist destinations. Yet, the hotel crisis has not reached its lowest point. Many of the resorts could, however, recover by the end of 2021, if they can attract foreign customers closer to home.

Pornthep Booncham, owner of Sea Dance Resort, Koh Samui has a different view. His 150 Million Baht worth resort targets British, French and German tourists so when he knew there was coronavirus in November 2019 in Wuhan; he didn’t think that his retreat would be significantly affected.

The resort has been vacant since March 2020 when he last paid 100 per cent of his staff’s salary before they went under the Social Security Fund scheme. Right now, his team stay at the resort and do maintenance work. In May 2020, the government allowed resort and hotels to reopen and adhere to strict distancing and guidelines enforced by the province.

In mid-May, Bangkok Airways started flying to Koh Samui, but no tourists came. So, he decided not to operate the resorts foreseeing that it won’t cover operation cost. Pornthep is aiming to run his resort sometime in the third quarter, on a cost-saving basis to sustain his business.

“I’m planning to target local and Asian markets,” he told IDN. “(But), even if I reopen the resort in a new normal manner, I cannot expect the same outcome out of the changing world.”

As the future is uncertain, he says he’s turning his empty 1.18 acres plot of land into an integrated agricultural farm. He’s growing vegetables, farming fish, making organic fertilizer from waste disposal of the nearby community.

“To keep my business intact, sooner or later, I will turn it to a ‘farmer market’, and vendors together with buyers could use my resort to do their business”, he says. “I hope to make this an environmentally sustainable business for locals.” [IDN-InDepthNews – 06 June 2020]

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* Pattama Vilailert is a Thai tourism consultant and community tourism trainer.

Photos: (Top) Deserted Sea Dance Resort, Samui, May 2020 and (in the text) deserted Yaowarat (China Town), a most favourite attraction for Chinese tourists. March 16, 2020. Credit: Watcharapong Luengarunsiri

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