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Thailand tourism is changed forever

Tanutam Thawan

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OPINION

by Andrew J Wood

Last week the Thai government Minister’s speech shows me that tourism will never be allowed to recover to previous levels. The writing is definitely on the wall, windows and front door, that there has been a major policy shift in government thinking by PM Prayut Chan-o-cha’s cabinet.

In a deeply worrying development for Thailand’s massive Travel & Tourism industry, which last year generated a huge 2.2 trillion baht of income (US$ 55.2 billion), and accounted for 20%t of GNP and 10% of all jobs in Thailand, the deputy PM Supattanapong Punmeechaow said that the country relied too much on tourism and that this was unacceptable.

This must be as worrying for property developers as well as investors. If the 39 million tourists that Thailand received last year in 2019, is never to be repeated, why do we need to continue building and investing in new hotels?

According to Thailand’s The Nation, deputy PM Supattanapong Punmeechaow admitted that the Covid-19 outbreak had exposed cracks and faults in the Thai economy.

“The Covid-19 outbreak that hit Thailand since April has exposed the fragility of the economy and shed light on the fact that we rely too much on export and tourism.”

This is certainly a departure from what the Minister was saying back in August. The deputy PM, who also holds the Energy portfolio, announced then the formation of a new economic panel, and boasted that the new economic committee will boost tourism and employment. He said the panel agreed to increase subsidies for local tourists and create 1 million jobs in the near future to combat growing unemployment.

Supattanapong Punmeechaow the deputy PM is cleary worried about putting too many eggs in one basket and spreading the risk. However it maybe too early to start walking away from tourism when other industries are simple not ready to take up the slack. Infrastructure improvements; legal reforms, changes in corporate ownership regulations and reduced bureaucracy are just a few of the changes the chambers of commerce have been asking for and must be in place BEFORE we start to cook the goose that lays gold bullion on the floor of the vault in the bank.

The deputy PM who was speaking last week at the “Restart Thailand 2021” dinner talk held at Siam Paragon shopping complex in Bangkok said… “The outbreak has had an especially heavy impact on small and medium businesses, prompting the government to spend over 800 billion baht on SME aid measures including postponing debt repayment worth over 6.8 trillion baht for 12 million SMEs.

“However, from July onwards, economic indicators have been pointing toward an improving trend thanks to cooperation from all parties in outbreak prevention, despite some minor impact from the political situations.”

“The tourism industry has shown improvement, with about 30 per cent occupation, jumping from just 6 per cent in April, thanks to the government’s economic stimulus campaigns such as the ‘Let’s Go Halves’ shopping subsidy.”

“Through the Thai Credit Guarantee Corporation, the government is also planning to provide an additional 150 billion baht in loans to help small and medium businesses.

“The battle against Covid-19 is not over yet. The government still has many projects in the coming year to boost the economy, attract foreign investors and build infrastructure for future expansion.”

“These projects include the construction of 14 Skytrain lines in Bangkok covering 500 kilometres in the next four to five years, larger than London’s Underground, and the infrastructure projects in the Eastern Economic Corridor to support digital technology, 5G and robotics industry.

“It is unacceptable to let Thailand slide back to the period before Covid-19. Since the global economy is changing we must be more proactive in attracting foreign investors, and the agencies responsible for this are the Board of Investment Office and Eastern Economic Corridor Office,” Supattanapong said.

“The next step will be to put Thailand on the list of top 10 countries with ease of doing business, which is a goal proposed by five countries who are our major trade partners.”

The deputy PM further explained that next year the government will focus on investing in new industries that will help reduce reliance on export and tourism.

“Bangkok will be the centre of regional offices of multinational companies, while Thailand’s automotive industry will focus on the manufacturing of electric vehicles (EVs). EVs will create other related industries such as smart equipment manufacturing and electricity generating from renewable energy. This will create a great opportunity for Thailand to further invest in community power plants, as well as biomass and solar power plants in Laos.”

ANDREW J WOOD

Andrew J Wood was born in Yorkshire England, he is a professional hotelier, Skalleague and travel writer. Andrew has 48 years of hospitality and travel experience. He is a hotel graduate of Napier University, Edinburgh. Andrew is a past Director of Skål International (SI), National President SI Thailand and is currently President of SI Bangkok and a VP of both SI Thailand and SI Asia. He is a regular guest lecturer at various Universities in Thailand including Assumption University’s Hospitality School and the Japan Hotel School in Tokyo.

The content of this article reflects the writer and does not necessarily reflect the editorial stance of The Thaiger.

 

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46 Comments

46 Comments

  1. Avatar

    Bob

    Sunday, December 20, 2020 at 12:42 pm

    I think many won’t like, it won’t be easy to turn back at mass tourism but I really think it is the smart move to do. I fully approve this drive line.

    • Avatar

      Ken Scott

      Sunday, December 20, 2020 at 4:04 pm

      We can have both: successful mass tourism AND new industries. Tourism is a massive poverty alleviation machine. Don’t suppress it. To say Thai economy can’t go back to pre Covid is arrogant. It condemns millions of people dependent on it to continued abject poverty. Singapore is a high skill, high education economy. It is still very invested in promoting tourism. And rightly so. The short sighted Deputy PM mentioned above (who is on full tax payer funded public sector salary) needs to get off his high horse and smell the coffee.

      • Avatar

        preesy chepuce

        Thursday, December 24, 2020 at 9:57 pm

        I agree, but what’s lacking is realism… people came to Thailand in increasing numbers over the last 20-30 years, because they believed it to be good value for money, and that vaLue’s diminished since 2014.

        They don’t want to hear it, but they have to cut prices or invest in raising standards. There are economic factors beyond their control that are constraining the finances of their customers, Cheap Charlie land?

  2. Avatar

    matt jones

    Sunday, December 20, 2020 at 12:54 pm

    Become a hub for crypto companies

    • Avatar

      Don jones

      Sunday, December 20, 2020 at 1:51 pm

      Zzzzzz

    • Avatar

      Davos Dave

      Sunday, December 20, 2020 at 2:16 pm

      The SEC would be fully supportive of this; the BoT and MoF both have a more mixed record and nuanced view.

      Nevertheless, this is a legitimately good idea with very low overhead to implement, the majority of the cost being the cost of reducing paperwork sufficiently to attract interest. It would take strong political will to achieve this in the civil service. Make set-up a VIP-ish service (like the BoI company path but even easier) and charge accordingly.

      The govt must also keep a hands-off approach to the nascent industry for the plan to achieve any benefit to the country. For the reality is that the majority of crypto companies – even more than standard tech – can easily leave a jurisdiction at the drop of a hat. Conditions must continue to be inviting for them to stay. Any regulatory interference (beyond enforcement of laws that protect against direct and incontrovertible harm) will cause initiative failure.

      • Avatar

        Issan John

        Sunday, December 20, 2020 at 3:41 pm

        I’m not sure I completely follow what you’re saying, but even if you radically changed the education system in Thailand, which will take time to take effect even if it starts tomorrow, where are the vast majority of Thais to be employed?

        How many people actually have the capacity, in any country, to work productively and make a living in a “crypto company”?

      • Avatar

        J.C.

        Monday, December 21, 2020 at 11:02 am

        It seems like the old “Lambos on Mars” delusions around crypto have branched out into new territory now. Everyone’s a cryptocurrency “expert” these days.

        • Avatar

          preesy chepuce

          Wednesday, December 23, 2020 at 4:20 pm

          It’s the very definition of a speculative bubble… everyone talking it up, knowing that everyone is talking it up, and all waiting for the moment to cash out before the bubble pops, it’s like a parlour game.

          No intrinsic value, just endless startup guff, like a latter-day casino for faddish investors seeking to look clever, without actually understanding enough to see the Emporer’s new clothes.

    • Avatar

      shoonya

      Monday, December 21, 2020 at 4:35 pm

      Cryptos do not add any value to the GDP of the country.

  3. Avatar

    Alam

    Sunday, December 20, 2020 at 3:19 pm

    Due to pandemic disaster tourism industry may affects cause of economic problems around the world, people have not much extra money to spend for foreign tour.
    It’s not a wise idea to expect too much from the tourism sector for the upcoming years till 2023 or more.
    In my opinion to concentrate on exporting development is better to gear up the economy.

    Rest of the countries may require to consume various types of products, Gov’t may study products basis exporting development and demands from several countries.

    Tourism sector will not boom instantly under the present quarantine style.
    Seasonal tourists will come for couple of weeks within limited budgets.
    So 14, 10 or even 7 days of quarantine period may not works.

    Just can wait for the vaccine, which may offer to the tourists on arival ( whom not yet obtained).

  4. Avatar

    Richard Renwick

    Sunday, December 20, 2020 at 3:26 pm

    It’s looking like only China and Russia will be the only countries allowed back to where it was before? The rest will just have to lump it with extra expense and hoops to jump through to visit.

  5. Avatar

    Issan John

    Sunday, December 20, 2020 at 4:02 pm

    … and sorry, Andrew J Wood, but if you’re reading all that into reported excerpts from an after dinner speech at a dinner talk by a virtual unknown on the political scene who’s reportedly only Deputy PM because he was one of the PM’s “personal advisers” since the coup, then I think you’re possibly reading rather too much into it.

    • Avatar

      The Land of Smiles

      Sunday, December 20, 2020 at 7:59 pm

      That`s what I`ve been thinking. These bureaucrats are mostly all mouth and no trousers, so you need to take with a pinch of salt whatever sweeping declarations they make.

  6. Avatar

    Toby Andrews

    Sunday, December 20, 2020 at 4:43 pm

    Yes the tourism industry will be changed, but not for ever. Nothing much is forever.
    If any customer suffers financial loss, that customer will be unlikely to return.
    Too many tourists have lost flighst with no refunds. Lost hotel deposits. Lost their two weeks a year holiday.
    Most importantly, lost confidence in Thais as a race that can be trusted.
    The same applies to investors, who bought a condo, and two months later cannot return to Thailand to stay in that condo. Except by paying for very expensive regulations.
    The government state they want to reduce their reliance on tourism. They will have no choice. Tourism will disappear massively.

    • Avatar

      Issan John

      Monday, December 21, 2020 at 12:13 am

      So tourists and condo buyers around the world won’t be going anywhere, then ….. oh well, ho hummmm …..

      • Avatar

        Toby Andrews

        Monday, December 21, 2020 at 6:50 am

        Not to Thailand.

  7. Avatar

    Wijnschenk

    Sunday, December 20, 2020 at 4:50 pm

    I read he said something totally different some months ago??!!
    So what is the value of his words now?

    • Avatar

      Issan John

      Monday, December 21, 2020 at 12:14 am

      Correct.

  8. Avatar

    Jack Sombra

    Sunday, December 20, 2020 at 5:12 pm

    Thailand’s tourist industry grew so much not because of government but rather despite it and will continue to do so once restrictions like quarantine are gone.

    And there is no real policy to block or even change the mass tourism market, how do we know that? Because who is Thailand pushing to have back first? China, who are basiclly the whole mass tourist market here.

    Now if you see them talking about blocking China, then start to worry.

    • Avatar

      James Cooks

      Monday, December 21, 2020 at 8:45 pm

      Agree

  9. Avatar

    Bill Fischer

    Sunday, December 20, 2020 at 5:21 pm

    Having a large percentage of the GDP being tourism-related isn’t necessarily a bad thing. Having it go back to the unregulated cluster—- that it was pre-pandemic wouldn’t be wise. The shift needs to be from quantity tourism to quality tourism. This is not going to happen overnight. It IS going to require the authorities to actually enforcing some existing laws.

    This constant blabbering about foreign investors isn’t realistic. Thais, as much as I love them, have some of the worst English language skills on earth and similarly poor work ethics. The government isn’t exactly a bastion of Democracy. The Baht is too strong. I could go on. There could be some growth in foreign investment, but I would think that’s way down the line (many years from now).

    • Avatar

      William Dodd

      Sunday, December 20, 2020 at 9:12 pm

      What kind of fool can turn the back on 55 billon dollars. The crass stupidly of the thai government never ceases to surprise me.Maybe the guy who announced this should spend sometime in a paddy field for 200 baht a day.

    • Avatar

      preesy chepuce

      Wednesday, December 23, 2020 at 4:23 pm

      Thailand is the Spain of Asia, it’s tourism appeal is for the exotic, and faux luxury on a budget, perfect for middle classes looking to seem a bit different from the working class cavalcade to Spain. Trying to convert that to niche is a big ask… you can’t do “mass niche”, that’s an oxymoron, so going niche means reducing the size of the industry, and that seems unlikely, because it fills a gap that is accessible to unskilled labour.

  10. Avatar

    Johnny Dee

    Sunday, December 20, 2020 at 5:37 pm

    Thai tourism changed forever WOW MR DEPUTY PM or whoever you mean to be this week?? Absolute ridiculous statement but then we are getting statements like this day after day!!! Of course things are changing all around the world at the moment with the infected China virus but please what an absolute croc of …. anyway the vasts amounts of money that tourism brings into the country should be praised. Vast numbers of Thai people need tourism and rightly so to keep their own businesses afloat. He should go and tell the taxi drivers, tour operators in many fields food sellers and so on and so on about the RIDICULOUS plans… I wonder what next weeks pen pushers in the cabinet are thinking about doing while the Thai people suffer day after day week after week year after year.. We all know tourism is changing everywhere around the world with what’s happened but in time things will get back to normal and I wonder then if the deputy or PM or any other pie in the sky would say the same statement and turn away millions at the borders with their vast amounts of STASH?? I doubt very much.

  11. Avatar

    Jesus Monroe

    Sunday, December 20, 2020 at 5:41 pm

    Skilling up the country in other ways is smart but it takes time. Of course there are millions that don’t have the education to skill up. They so need tourism…..

  12. Avatar

    Ray

    Sunday, December 20, 2020 at 7:18 pm

    Just read the opinion from 2 scientists regarding contamination from vaccinated persons. They basically expected that after 1 month the body will respond quickly to deal with the virus that will enter the body. It will not multiply and the virus load coming out the respiratory system is minimal. The risk for others is low. This is a prediction but it has to be determined wrong or right after vaccinated people have been followed for some months.
    I think this means that because there still is the slightest chance of contamination, the quarantine measures will still be in force for vaccinated persons. This policy will likely persist till who knows when sufficient Thais will be inoculated to prevent mass outbreaks of the virus. And with quarantine in place foreigners will stay way. I suspect that is one of the reasons the government is looking to other options than tourism. It will be a long time before the borders are open as before.

    • Avatar

      London Al

      Sunday, December 20, 2020 at 7:53 pm

      Not if the vaccine is coupled with testing, this eliminates any chances of contamination and any need for quarantining.

      • Avatar

        Ray

        Monday, December 21, 2020 at 4:53 am

        I wish you are right Al, but one test is not (yet) fail proof. At the moment, a few tests are needed to be sure one is not infected and this is done in in quarantine. Since vaccinated travelers still can carry covid-19, no matter how small the virus load and risk for others, I am afraid they will not let you in the country with one test and no quarantine.

        • Avatar

          London Al

          Monday, December 21, 2020 at 7:02 am

          You’re right in saying the vaccine in isolation isn’t completely foolproof and neither is a test, however combining them is.

          You have full vaccination then a test before you leave, and two when you arrive, one rapid and one 24 hour for which you might have to quarantine for one night, the chances of the vaccine not working, contracting the virus asymptomatically, then having 3 consecutive false negative tests in 2 different countries, runs into millions to one.

    • Avatar

      Andrew

      Sunday, December 20, 2020 at 11:13 pm

      Vaccinated people could still carry and spread the virus and should continue to wear masks, practice frequent hand-washing and socially distance until a majority of the population is inoculated

      • Avatar

        London Al

        Monday, December 21, 2020 at 7:14 am

        If vaccinated people can still carry and spread the virus what is the point of inoculating the majority of the population with something that doesn’t work? It’s pure fallacy, believe in the extremely clever and highly responsible people who create and regulate the vaccines rather than negative bloggers.

        However once vaccinated I certainly wouldn’t have a problem wearing a mask in public areas and distancing if that is what’s required.

        • Avatar

          J.C.

          Monday, December 21, 2020 at 11:04 am

          You have a very low IQ. Stop commenting.

  13. Avatar

    James R

    Sunday, December 20, 2020 at 8:53 pm

    Have both.

    The hotels etc are still there so when tourism gets back to normal over the next two years then well and good.

    The drop in tourism is the same for most countries in the world.

    You can still add new industries etc to the economy, do not throw the baby out with the bathwater.

    So tourism is 20%, increase other areas of industry and it will then become perhaps 10% but still maintaining the same billions of baht in income.

    I can not believe the logic sometimes of planners.

  14. Avatar

    crispy

    Sunday, December 20, 2020 at 9:35 pm

    What utter tosh. None of the numbers are correct and the vision of a high-tech Thailand where Bangkok resembles Los Angeles is drivel.

  15. Avatar

    STEVE BROADBRIDGE

    Monday, December 21, 2020 at 1:08 am

    THE THAI GOVERMENT NEED TO BE VERY CAREFUL IN TRYING TO CURB THERE RELIANCE ON MASS TOURISM WHICH ACCOUNTS FOR 20 PERCENT OF THERE GDP , BY ALIENATING TOURISM IN ANY WAY BY GOING FOR QUALITY INSTEAD OF QUANTITY IS SUICIDAL AS CAMBODIA , VIETNAM AND POSSIBLY MYANMAR WILL DEFINITELY BE PICKING UP THE SLACK OF TOURIST NUMBERS , THE THAI GOVERMENT NEED TO ATTACT MORE BUSINESS INVESTMENT FROM FORIEGN COMPANIES IN SETTING UP MANUFACTURING IN THAILAND AS OTHER SOUTH EAST COUNTRIES ARE BECOMING MORE ATTRACTIVE IN SEETING UP BUSINESS , SO WHAT I AM TRYING TO POINT OUT THAT THIS PROCESS WILL TAKE AT LEAST 10 TO 15 YEARS , SO DONT PUNISH THE AVERAGE THAI BY CUTTING TOURISM NUMBERS UNTIL YOU HAVE A STRONG BASE TO ATTRACT BUSINESSES AND REDUCE YOUR RELIANCE ON TOURISM .

  16. Avatar

    Daniel

    Monday, December 21, 2020 at 2:20 am

    Its always the same talk from politicians no matter what country you are in:

    There will be high-tech jobs for almost everybody, there will be renewable high-tech energy and everything will move from quantity to quality.

    Always the same visionary stuff. But really pulling it off is another matter all together. There will always be jobs where people get thier hands dirty. There will always be people who lack education and motivation but still need a job. And there will always be mismanagement.

    And this about moving from low quality too high quality tourism is not going too happen. There are lots of places out there competing with eachother about that. In what possible way can Thailand be better than all the other places? Even if i like thailand, when it comes to beauty, beaches and vacation it is in no way unique.

  17. Avatar

    Ben

    Monday, December 21, 2020 at 5:34 am

    Some observations:

    1. The rising baht, not government policy, will hurt tourism the most going forward. Thailand has attracted a lot of tourists and expats because it was cheap. In the past 5 years the baht has gained 17% against the USD and 23% against the pound.

    2. The Thai public education system is substandard and cannot produce enough skilled workers to transition to a higher end economy. They also won’t allow skilled labor from outside the country to enter as they want the high paying technology positions to go to Thais. Estonia, as an example, requires all their public school students to learn how to code because they want a future high technology economy.

    3. Thai business red tape is suffocating and needs to become more business friendly to attract capital. Also corruption hurts foreign investor sentiment. To attract foreign investor capital, a good portion of the rewards need to accrue to the foreign investor. Money will go where it’s best treated.

    4. Thai’s have a reputation for an extremely relaxed lifestyle. Most business and entrepreneurial situations involve long hours and a lot of hustling. A different mindset. Thailand and Silicon Valley are very different.

    • Avatar

      Yannick

      Tuesday, December 22, 2020 at 3:09 am

      You are right Ben, especially item 4 (sorry to say).
      Told my many Thai friends many times last year “watch out trees don’t grow up to the sky”.
      I see a possible second scenario in the (near) future and that is that foreigners will not be allowed to travel to Thailand because of C19 or …, although I hope not because it is the country of my heart.
      The future will tell.

    • Avatar

      Waverider

      Tuesday, December 22, 2020 at 8:29 am

      Well said Ben,Thailand is a food producer and exporter which is being stifulled by a strong bhat.
      Manipulation by the elite, I could go on.

  18. Avatar

    Richard Barker

    Monday, December 21, 2020 at 9:23 am

    Agree with what some previous comments suggest. But it just goes to show, Thai Government as has many Governments around the world they have been asleep at the wheel. The pandemic has found them all out. Corporates stashing Hugh profits whilst wages stagnate and the poor get nothing. But they shout out their economies are booming. Well, that was then, this is now. Only good Governments who kook after their people will recover.

  19. Avatar

    JC

    Monday, December 21, 2020 at 10:55 am

    The Thai economy was already in dire straights well before COVID. Are they trying to retcon that fact and blame COVID now?

    • The Thaiger

      The Thaiger

      Monday, December 21, 2020 at 1:02 pm

      It was? In what way was the Thai economy in “dire straights” before Covid?

      • Avatar

        James R

        Monday, December 21, 2020 at 5:31 pm

        To The Thaiger re JC”s comment.

        I think JC was referring to the music group Dire Straights, “Money for nothing and chicks for free….”

  20. Avatar

    Ian

    Wednesday, December 23, 2020 at 5:01 am

    A good friend of mine and a property solicitor once gave me some sound advice he said Ian don’t wait to put money in real estate put in real estate and wait I took his advice in UK 25 yrs ago and have prospered but that advice in Thailand at the moment well I’m thinking Ian don’t put money In real estate wait

  21. Avatar

    preesy chepuce

    Wednesday, December 23, 2020 at 4:17 pm

    ” the government will focus on investing in new industries ”
    Fantastic news… and long overdue. Education, education, education, that’s what the educated Thais I meet outside Thailand in universities tell me they want for their country. Hopefully this will mean Thailand reaching out to create trade deals with western countries and making it easier for westerners to contribute to Thailand’s future beyond dependence on tourism.

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