Thai industry leaders warn economy on brink of collapse

Thai industry leaders are warning that if tourists don’t return soon, the economy will soon collapse with daunting consequences. And, as the Covid-19 vaccination programme is slow to take off, the window is closing for this year to make any kind of substantial recovery through reopening the country.

Just this week, an opposition MP drew the government’s attention to the loss of 250 billion baht a month to the country’s economy caused primarily by the stall in tourism. Even PM Prayut has stated that this year’s economic challenge is immense.

Foreign tourism accounts for 20% of Thailand’s GDP but also dumps money into the hands of Thais who fall into the low socioeconomic category. Government subsidies and new industries have proven that they cannot replace in providing what the tourism sector has done for the economy.

But the Thai government has insisted on placing the health of its people over the economy as it joins other nations in the experimental game of balancing new virus variants with vaccine expectations. The lack of data on the newly rolled out vaccination campaigns has placed governments worldwide in a conundrum as they attempt to deal with the pandemic while financially bleeding out.

The President of the Thai Hotels Association, Marisa Sukosol Nunbhakdi, is sounding the alarm by pointing to the country’s 60 year old tourism industry infrastructure as on the brink of death.

Marisa estimates that, already, 50% of the hotels in Thailand are closed indefinitely while the rest are going to extreme lengths to minimise losses. Those hotels who are left, have been placing employees on minimum wages, required time off and allowing them to live inside their places of work.

She warned that this year’s situation is even graver than last year’s as businesses have already used up financial reserves with no firm end in sight for when money will start to trickle in again.

‘When we seek loans, banks always request our business plan or the period we can earn a profit, but under these circumstances, hotels don’t really have a clue when the business will get back to normal. ‘We need support from the government, or else we could see the whole tourism industry collapse before things get back to a better shape.’

The Bank of Thailand still maintains that the country will see over 5 million tourists this year, but The National Economic and Social Development Council is suggesting a much lower number of only 3.2 million visitors.

The Kasikorn Research Centre is warning that tourism may not return to Thailand this year, making the economy continue to rely on government supports.

SOURCE: Thai Examiner