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Inflation Equals Fewer Tourists And Lower Spending, Say Thai Hoteliers

BY LINE : THE NATION

FRI, SEPTEMBER 09, 2022

Thai Hotel Operators Are Worried That High Inflation Will Reduce Tourist Arrivals And Spending, According To A Survey By The Thai Hotels Association (THA).

Sixty-two per cent worry that inflation is eroding tourists’ purchasing power while 61 per cent are concerned about lower-than-expected foreign arrivals.

The survey was conducted among 106 hotel operators between August 8 and 24, THA president Marisa Sukosol Nunbhakdi said.

Other major worries expressed by respondents included the shortage of hotel workers (43 per cent), new Covid-19 outbreaks (40 per cent), businesses not fully opened (19 per cent), the currency exchange rate (18 per cent) and the Thai interest rate (18 per cent).

Only 11 per cent were worried about monkeypox as the number of cases in Thailand remains low. Six per cent expressed concern about China-Taiwan tensions amid a lack of tourists from these countries. China was the largest contributor of tourists to Thailand before the pandemic.

Marisa also highlighted positives for the hotel industry, including the extension of visa-on-arrival from 15 to 30 days or 30 to 45 days depending on nationality. The extension will run from October to March 2023.

Meanwhile, operators of MICE (Meetings, Incentive Travel, Conventions, and Exhibitions) have been handed a tax break to stimulate events organisation in Thailand.

Moreover, the new Long-Term Resident Visa (10 years) available from September 1 will lure more high-spending foreigners.

Meanwhile, airlines are opening routes again after Covid-19, especially from Asean countries, Northeast Asia, and South Asia.

However, Thai hotel operators are facing rising food and energy costs while the minimum wage increase would also affect costs and profits, Marisa said.

Hotels’ revenue in August was still low compared with pre-Covid times though it had improved since July when the country full reopened, she added.

The occupancy rate in August was around 47.5 per cent, up 2.5 per cent from July, after the Thailand Pass system was scrapped and the “Rao Tiew Duay Kan” (We Travel Together) scheme extended.

Most tourists are still Thai but foreign arrivals, especially from the Middle East and elsewhere in Asia, are increasing.

Hotel occupancy is rising in every region except the South and East, Marisa said.

“THA forecasts the occupancy rate in September will be around 40 to 45 per cent,” she said, adding that this figure could be higher if more foreign tourists arrive.

Meanwhile, the hotel employment rate has increased to 75.2 per cent of pre-Covid levels. However, it would take time to train new staff for the arrival of tourists in the fourth-quarter high season, she said.