The Red Shirt anti-government protesters have gone home, but Thailand’s tourism industry still is seeing red.
Armed soldiers, smoky streets and looted stores were the sad finale to two months of street protests seeking to force new elections. Those images have lingered in many minds, especially those of tourists, a couple of weeks since the protests ended.
Thailand now has the challenges of repairing its image and its tourism industry.
The number of visitors dropped significantly since the protests closed down Bangkok’s main shopping and tourist district in early April. Forecasts for this year were revised to 12 million visitors, down from 15 million, according to the Federation of Thai Tourism Associations.
The political standoff and the subsequent violent clashes caused losses of about US$1.9 billion to US$2.2 billion in tourism revenues, according to Atthachai Burakamkovit, permanent secretary of the Tourism and Sports Ministry. The government is talking with trade organizations to pinpoint the exact amount of the losses.
“Different trade associations have their own estimates to serve their own purposes,” said Atthachai.
Already, the government has earmarked US$154 million to help businesses related to tourism that are affected by
the turmoil and rioting. The package is awaiting the Cabinet’s approval.
“Using government funds to help private companies always is a difficult situation. And I don’t think anybody will hold their breath while this occurs,” said Bill Heinecke, chairman and CEO of Minor International, which operates 16 hotels in Thailand, including the luxury Four Seasons Hotel Bangkok.
The Four Seasons, on the front lines of the protests, was forced to close for seven weeks and expects to lose at least US$3 million as a result. Several other nearby upmarket hostelries also were shuttered.
“In my 40 years in the hotel industry, I haven’t seen anything this bad,” said Prakit Chinamornpong, president of the Thai Hotels Association.
The number of guest check-ins indicates a dire situation. Prakit said Bangkok’s occupancy rate for last month dipped to about 10 percent.
The hotel association wants the government to help loan repayments by fixing the interest rate at 3 percent for at least a year and to help workers.
During the turmoil, major travel agencies suspended tours to Bangkok, and that had a ripple effect on other destinations in Thailand. JTB Group, Japan’s largest travel agency, resumed ticket sales to Thailand only on May 27, after a month’s stoppage. Japanese made up the second-largest group of inbound tourists to Thailand last year, with almost 1 million visitors.
Prakit said the situation was worse than the 1997 financial crisis, the bird flu epidemic and even the occupation of Bangkok’s Suvarnabhumi international airport in 2008 by the People’s Alliance for Democracy (PAD), the Red Shirts’ ideological rivals.
“It took us five months to recover from PAD’s nine-day airport closure. But this time it’ll be at least six months or even more,” said Prakit.
As a result of the airport closure, the total number of inbound visitors in 2009 fell to below pre-crisis projections. The 12 million arrivals forecast for this year would see Thailand return to pre-2006 figures.
Any previous efforts by the government to drum up confidence abroad since has been futile.