In 2019, 39.8 million tourists came to Thailand. Their spending amounted to 11% of the GDP.
This year, the Tourism Authority of Thailand (TAT) expects 14 to 16 million visitors. That’s less than half, and still might be too optimistic.
The number just won’t cut it for many hotel operators, and doors might shut for good.
With most hotels scheduled to reopen 1 July (for Phuket, 1 September), operators are hoping that the upcoming government stimulus program (เที่ยวปันสุข) will give them the lifeline they need to stay in business.
The domestic travel stimulus program has a 22 billion baht price tag on it. But while there will be cash flows, the price war will dampen the bottom line. As well, domestic guests often fill bookings only on weekends. This makes scaling and hiring extremely tricky.
On the MICE (Meetings, Incentives, Conference and Exhibition) front, things are expected to be quiet for a long time. Globally, companies are suspending travel budgets and using e-seminars through online platforms.
Things indeed look bleak.
Other than stimulating local travels, the government is reaching out to a few embassies to draft out “acceptable” plans for foreign arrivals.
But it’s a tiny pool, as these are embassies representing countries with low-to-no recent local transmissions of Covid-19. As well, guests would have limited access to only specific properties and areas of the country. The length of stay may also be restricted or fixed.
That’s not all.
The Center for Covid-19 Situation Administration (CCSA) spoke of the possibility of allowing “a select group” of foreign guests. But, a mandatory 14-day state quarantine is also a possibility.
Admittedly, this is not in anyone’s travel plan.
Business travelers may have an easier go of it.
Like Japan and Taiwan, Thailand plans to give priority to business travelers. They won’t have to be quarantined. But there will be restrictions on their mobility, as well as a 3-5 days limit for staying in the kingdom.
However, skilled foreign laborers would have to be under the 14-day quarantine; the reason cited is because they will stay in Thailand for the long term. The same goes for medical tourists.
These are trying times for the industry.
At the Thailand Tourism Forum 2020, the market data firm STR Global stated that the hotel occupancy rate for Thailand would normalize at around 60% from 2021 onwards.
In 2019, the number was 78%, and it may take up to five years for the industry to see that kind of number again.
“[Thai hoteliers] should reframe the conversation,” Jasper Palmqvist, Area Director from STR said at the Forum.
“[They] shouldn’t ask when they would see 2019 levels again. But instead, when will [they] have realistic levels that provide a fair bottom line.”