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Sat 17 Jul 2010 04:00 AM

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After the turmoil

Bangkok is safe once again, but how quickly will Thailand's tourism industry bounce back from the damage done by the demonstrations?

After the turmoil
After the turmoil
A Thai soldier stands guard at Government House in Bangkok. The authorities have now lifted the curfew that was imposed during the protests.

Bangkok is safe once again, but how quickly will Thailand's tourism industry bounce back from the damage done by the demonstrations?

With the streets of Bangkok now cleared of anti-government protestors, Thailand's tourism industry has embarked on a major charm offensive to try to lure back visitors and wipe away the images - televised worldwide - of the army crackdown on Red Shirt protestors in the city centre.

The violence and fatalities in the Thai capital had the effect of completely devastating Thailand's lucrative tourism industry over the months of May and June. Thailand's National Economic and Social Development board has estimated that the demonstrations led to losses of 113 billion baht (US$ 3.49 billion). Hotels saw occupancies plummet - Deepak Ohri, CEO of the Lebua at State Tower in central Bangkok said occupancy levels during May and June fell to just 21 percent; and as the violence started to escalate, hotels located in the demonstration area itself, such as the landmark Dusit Thani Bangkok, were even forced to close their doors for the duration of the protests.

Safety reigns

With the political turmoil over for now, the government has been quick off the mark to try to revive its vital tourism industry, ploughing 400 million baht ($12.4million)into promoting Thailand and helping tourism related-business affected by the rioting.

A major campaign has been launched in the Middle East aimed at driving home the message to potential visitors that Thailand is safe to visit. The campaign officially kicked off in June with an event at the Dusit Thani Dubai called ‘We Love Thailand'.

H.E Pasan Teparak, Thailand's consul-general told guests that while Thailand's 2010 tourism targets had been revised down from an expected 16 million visitors to 14 million, he had "every confidence that Thailand could overcome past challenges."

"I want to tell the world that that the situation in Thailand is now back to normal and that foreign travellers and tourists are warmly welcome back. The impact of the riots has cost Thailand a very expensive lesson and the country needs to be restored as soon as possible."

He added: "When the going gets tough, the tough gets going. This is why we are sitting here before you to brief you on our current situation in Thailand and to show you that Thailand is now back on track, blinking on your radar screen as one of the best destinations to travel to before summer begins."

Other Thai tourism execs backed up this message. Manan Boonyachai, Middle East general manager for Thai Airways said one of his primary goals was now to educate the travel trade about the safety of destination.

"We are trying to educate our travel agent partners to fully understand the situation," said Boonyachai. "One thing we have to do now is to tell them that everything is back to normal; even though the state of emergency is still valid, it doesn't mean anything to tourists- it's for the sake of safety for everyone, life in Bangkok is normal."

A damaging price war

A number of incentives have been introduced by the Thai government to stimulate foreign travel to Thailand. For example, a waiver of tourist visa fees, as well as its ‘3G' campaign standing for ‘Good Food, Good Health and Good Price'.
But the drop in visitor numbers has been so steep that an inevitable price war has begun, meaning the already cheap destination just got even cheaper. Royal Orchid Holidays - a division of Thai Airways - for example is offering holidays to Thailand at 50 percent reductions.

There are fears that such price-slashing will only serve to damage the industry further. Albert Van Walbeek, chairman of the Thai Pacific Asia Tourism Association (PATA) said if hotels slash prices now they could take up to "four years" to recover.

"Putting Thai tourism product suppliers under revenue management and cash flow stress does not help Thailand's tourism industry. It will only create more post-crisis challenges for tourism organisations that have already suffered low occupancy and demand due to the political crisis over the last eight weeks or so.

He added: "History shows us that while brutal price-cutting may offer some short-term relief, it creates artificial benchmarks that are used against Thailand's hotels and tour operators in the medium and long term"

Hotelier Deepak Ohri agrees that ‘adding value' rather than cutting rates is the way to help Thailand's tourism industry recover. "Many hotels and airlines have been criticised for dumping the rates so low," he said. "At Lebua we are not dumping rates to bring in guests - on the contrary we are adding value. Value is always appreciated at any level, by any consumer."

Lebua at State Tower has introduced a promotion for an upgrade to its executive Tower Club suites. "For around US$210 per night you have free mini bar, internet, and three food presentations per day. It's a great concept and we see a lot of Middle Eastern travellers accepting it which is a very positive start."

Long term prospects

Price slashing or not, Thailand's tourism industry has always been resilient and quick to bounce back from any disaster. Just think back to November 2008 - and another PR disaster for the country's tourist trade - when Bangkok's Suvarnabhumi Airport was hijacked by protestors leaving tourists stranded inside for days.

Pramoth Supyen, Middle East director, Tourism Authority of Thailand said he feels optimistic about GCC visitors returning quickly to Thailand: "I think especially for the Middle East market, both the Arab people and expats they don't care about this situation because it has passed already and was only concentrated in a small area of Bangkok" He added: "If you don't want to go to Bangkok you can go directly to Phuket or to Chiang Mai. Yes, some of our department stores may have been burned and damaged, but in Bangkok we have so many of them. I am very optimistic about the Middle East market coming back."

And it seems that the sentiment among local travel agents is not far removed: "The number one destination in this market has always been Far East, and it will always be the Far East," said V Jayaram, managing director, Sharaf Travel. "Thailand is an every-green, all-year-round destination.  It's affordable and it offers enough for everybody. Yes we have felt the impact of bookings on the holiday side, but we are happy now the situation is all over and its business as usual.

He added: "Thailand was a sad story, but I think people saw what was happening there and just put forward their plans. The tourism industry will do all that it takes to make sure they bounce back strongly."

caroline@carolinetapken.com 9 years ago

I am taking full advantage of the value for money offered by Thailand now - and am flying on Monday for a week's vacation! I understand that from the end of July for around one month there will be great air fares too - and that is a fantastic time to escape the heat of the UAE for the beaches and greenery of Thailand. Having lived there, I know how quickly life returns to normal in Thailand after any problems. Personally, I have absolutely no fears for my safety or that violence will break out again.