Flooding may impact Thailand’s tourism recovery
Hopes for Thailand’s tourism industry to recover are being challenged by the worst flooding the kingdom has seen in years. With large areas of croplands being suffocated by seasonal storms and rising rivers, food prices are at risk of increasing while tourism recovery is undoubtedly being slowed. According to Bangkok Post, popular tourist destinations are now being flooded by heavy rains after tropical storm Noru hit the country.
An estimated 1.2 million rai of cropland was hit with almost 82,000 houses reportedly damaged across 510 districts. As more storms are forecasted for the next few weeks, the government is taking steps to minimise further damage to crops and houses. As rice crops have taken the hardest hit from the rain, Kasikorn Research Centre says that the main rice harvest may drop by around nine per cent. To make matters worse, India and Pakistan are also forecasted to yield smaller harvests this year.
“The current flood impact will hit households that are already vulnerable due to low purchasing power, high costs of living, and high household debt.”
The lower rice output and flood damage to other produce could be detrimental to the country as it is already battling the highest food inflation in over a decade. High fuel, a weakened baht, and electricity prices have only complicated matters. Tim Leelahaphan, a Bangkok-based economist at Standard Chartered Bank, says the negative impact of the flooding could be apparent over the next two quarters for Thailand.
“We need to monitor whether it will impact manufacturing or result in rate cuts. Any potential impact on tourism, which we hope would recover in the next quarter or two, will be a new lesson for Thailand this time, especially as it is the hope for next year’s economic recovery.”
Thailand is ranked among the world’s most vulnerable to climate change. And, its history of battling floods has contributed to its vulnerability.
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