Asia’s airlines, tour agents and cruise operators are on alert for a tourism slowdown in Thailand, where partying and drinking alcohol in public are off limits following the death of Thai King Bhumibol Adulyadej.
The government called on the nation to avoid “joyful events” for 30 days and to dress in mourning for a year.
Travel companies across the region say they are trying to grasp the potential consequences for their businesses.
Photo: AP
Hana Tour Service Inc, South Korea’s biggest tour operator, expects demand to be hurt during the mourning period, a spokeswoman said.
Representatives for Korean Air Lines Co, Asiana Airlines Inc and Jetstar, which is owned by Qantas Airways Ltd, said they are monitoring the situation.
“In the short term, we could possibly get some weak data and I’m sure tourist arrivals will be affected,” Jefferies Group LLC chief global equity strategist Sean Darby told Bloomberg TV in Hong Kong, adding that he does not see any dramatic changes to policy. “There’s going to be knock-on effect generally from industry slowing down,” but short-term outflows will be “easily managed by the authorities,” he said.
While it is too early to gauge the immediate impact on tourism, any alcohol restrictions and 12 months of mourning might make Thai resorts less attractive for some vacationers. Thailand has long been a favorite destination for European and Asian holidaymakers, who are drawn to Bangkok’s nightlife and southwest island resorts, such as Phuket.
Thailand’s economy has come under strain in recent years given weak global demand, a slowdown in private investment and inflation near zero percent. Tourism, one of the bright spots fueled by visitors from China, accounts for at least 10 percent of the country’s GDP. That has helped the Southeast Asian nation boost foreign-currency reserves and run up one of the highest current-account surpluses among emerging markets.
The country attracted 7.9 million visitors from China last year, a 70 percent increase from 2014, and posted a quarterly record for Chinese visitors again in the three months to March this year.
The Thai military government has also been betting on more than US$18 billion in stimulus measures for farmers and small businesses to help boost local demand and offset a decline in exports.
Kee Chou Ng, a Kuala Lumpur-based analyst with RHB Capital Bhd, said he is not anticipating a significant impact on tourism in Thailand, since travelers across the world have become fairly immune to political developments in the country.
As an example, he cited that recent terror attacks and political uncertainty had little effect on arrivals.
“People globally have internalized all of these shocks,” Ng said by telephone. “Even after the bombings, you saw tourism bookings way up. Thailand is expanding its airports and they are building roads to new tourism hotspots.’’
Ng said he is estimating Thailand will receive more than 33 million tourists this year and 36 million next year, up from about 30 million last year.
Underscoring optimism there will be a smooth transition, Thai stocks jumped the most since 2013 and the baht strengthened. The benchmark SET Index surged 4.2 percent, while shares of Thai Airways International PCL climbed as much as 17 percent.
Ships run by Royal Caribbean Cruises Ltd, Princess Cruises — which is owned by Carnival Corp — and Costa Cruises are among those due to visit Phuket this month.
A spokeswoman for Costa Cruises in Hong Kong said the company is assessing whether any changes need to be made.
Royal Caribbean said it does not see any impact on bookings and does not plan to change itineraries.
A Sydney-based spokeswoman for Princess Cruises said the company is checking for any impact on services from the king’s death.
No tours have been called off so far, said Steve Huen, executive director of Hong Kong-based travel agency EGL Tours.
And even if some shows, like concerts, are canceled, there is flexibility to change trip schedules, he said.
Hamzah Rahmat, president of the Malaysian Association of Tours & Travel Agents in Kuala Lumpur, said he had not received any reports of cancelations and saw no reason to alter itineraries.
“Life has to go on, and I think business also has to go on,” Hamzah said.
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