Thailand’s economy in dire straits as tourists stay away


Thailand’s tourism industry and with it the country’s entire economy have come under significant distress and will feel the heat far into 2021 if international tourists are not allowed back into the country soon, the Bank of Thailand warned on  September 1.

Tourism, which officially contributes around 22 per cent to Thailand’s GDP – unofficially the number is closer to 30 per cent when services provided by the vast informal sector are factored in –, has come to a de facto standstill since April after the country closed its borders and international airports for foreign tourists, leading to substantial losses in tourism income and leaving millions of people left unemployed in the sector.

According to the Bangkok Post, officials have reduced their forecast for the number of foreign tourists this year to 6.7 million – most of which arrived in the first quarter anyhow. This compares to tourism arrivals of 39.8 per cent in 2019, a huge drop. With inbound flight restrictions still in place, the ratio of foreign travelers is expected to shrink by 100 per cent year-on-year between April and December.

For 2021, the forecast is 12 million international tourist arrivals, even though it is still unclear when and under which conditions borders will eventually be opened for tourism again.

The government and the Tourism Authority of Thailand (TAT) have worked out a number of ideas how to kickstart the industry, including opening the island of Phuket for controlled arrivals from countries with low Covid-19 cases, or offering a new nine-months long-stay visa for senior travelers who seek warmer climates to spend their winter time.

In a widely ridiculed proposal, TAT suggested to hand out 500 baht ($16) to each expat living in Thailand when they undertake a domestic trip “to offset higher admission fees” to attractions like temples and national parks where foreigners generally pay up to three times the amount Thai nationals do.

Solutions not yet on the table

However, none of the proposals have been met with great acclaim yet, neither by the industry nor by most members of the public. Observers say that the loopholes for potential international tourists were a huge amount of paperwork, expensive mandatory insurance protection, a mandatory 14-day state quarantine at their own expense and restricted travel inside the country.

“Who from Europe, for example, would want to go through all this when they can arrange a nice winter stay in the pleasant climates of Greece, southern France, Spain or Italy where there a far less restrictions, great food and culture and intelligent, friendly and communicative people, as compared to Thailand with its overcharging restaurant, broken temples, girlie bars and transvestite shows?,” an expat rhetorically asked an Investvine reporter.

“Even the Maldives with its reopened borders and current discounted rates would be cheaper than coming to Thailand,” the person said.

Difficult decision

As it stands, the Thai government appears to remain very wary of opening for tourism back up too quickly, potentially inviting a resurgence of the virus. However, the decision is tough since the collapsing industry is equally threatening people’s livelihoods.

Don Nakornthab, the Thai central bank’s senior director of the economic and policy department, said that “if foreign travelers still cannot visit the country next year, this will impact Thailand’s economic growth more severely. The government should strike a balance between tourism measures and outbreak containment.”

He conceded that the possibility of a second wave cannot be ruled out, as shown by what happened in places such as Hong Kong and Singapore. However, he maintained that a rate of 20 to 30 new cases a day is probably “manageable” for the sake of a recovery of the industry.

As of September 1, Thailand has reported 3,417 Covid-19 infections, of which 3,274 recovered. Fifty-eight people died from the disease.



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Thailand’s tourism industry and with it the country’s entire economy have come under significant distress and will feel the heat far into 2021 if international tourists are not allowed back into the country soon, the Bank of Thailand warned on  September 1. Tourism, which officially contributes around 22 per cent to Thailand's GDP – unofficially the number is closer to 30 per cent when services provided by the vast informal sector are factored in –, has come to a de facto standstill since April after the country closed its borders and international airports for foreign tourists, leading to substantial losses...


Thailand’s tourism industry and with it the country’s entire economy have come under significant distress and will feel the heat far into 2021 if international tourists are not allowed back into the country soon, the Bank of Thailand warned on  September 1.

Tourism, which officially contributes around 22 per cent to Thailand’s GDP – unofficially the number is closer to 30 per cent when services provided by the vast informal sector are factored in –, has come to a de facto standstill since April after the country closed its borders and international airports for foreign tourists, leading to substantial losses in tourism income and leaving millions of people left unemployed in the sector.

According to the Bangkok Post, officials have reduced their forecast for the number of foreign tourists this year to 6.7 million – most of which arrived in the first quarter anyhow. This compares to tourism arrivals of 39.8 per cent in 2019, a huge drop. With inbound flight restrictions still in place, the ratio of foreign travelers is expected to shrink by 100 per cent year-on-year between April and December.

For 2021, the forecast is 12 million international tourist arrivals, even though it is still unclear when and under which conditions borders will eventually be opened for tourism again.

The government and the Tourism Authority of Thailand (TAT) have worked out a number of ideas how to kickstart the industry, including opening the island of Phuket for controlled arrivals from countries with low Covid-19 cases, or offering a new nine-months long-stay visa for senior travelers who seek warmer climates to spend their winter time.

In a widely ridiculed proposal, TAT suggested to hand out 500 baht ($16) to each expat living in Thailand when they undertake a domestic trip “to offset higher admission fees” to attractions like temples and national parks where foreigners generally pay up to three times the amount Thai nationals do.

Solutions not yet on the table

However, none of the proposals have been met with great acclaim yet, neither by the industry nor by most members of the public. Observers say that the loopholes for potential international tourists were a huge amount of paperwork, expensive mandatory insurance protection, a mandatory 14-day state quarantine at their own expense and restricted travel inside the country.

“Who from Europe, for example, would want to go through all this when they can arrange a nice winter stay in the pleasant climates of Greece, southern France, Spain or Italy where there a far less restrictions, great food and culture and intelligent, friendly and communicative people, as compared to Thailand with its overcharging restaurant, broken temples, girlie bars and transvestite shows?,” an expat rhetorically asked an Investvine reporter.

“Even the Maldives with its reopened borders and current discounted rates would be cheaper than coming to Thailand,” the person said.

Difficult decision

As it stands, the Thai government appears to remain very wary of opening for tourism back up too quickly, potentially inviting a resurgence of the virus. However, the decision is tough since the collapsing industry is equally threatening people’s livelihoods.

Don Nakornthab, the Thai central bank’s senior director of the economic and policy department, said that “if foreign travelers still cannot visit the country next year, this will impact Thailand’s economic growth more severely. The government should strike a balance between tourism measures and outbreak containment.”

He conceded that the possibility of a second wave cannot be ruled out, as shown by what happened in places such as Hong Kong and Singapore. However, he maintained that a rate of 20 to 30 new cases a day is probably “manageable” for the sake of a recovery of the industry.

As of September 1, Thailand has reported 3,417 Covid-19 infections, of which 3,274 recovered. Fifty-eight people died from the disease.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

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