War in Israel and reduced confidence after last week’s Bangkok mall shooting are expected to cause foreign arrivals to drop next week, though the private sector hopes the visa exemption scheme can resuscitate the market over the next two months.
The Tourism and Sports Ministry reported foreign arrivals last week (Oct 2-8) fell to 497,966, down 9.86% from the previous week, as Chinese visitors dipped significantly.
Many of them headed back home early to avoid crowded flights at the end of the Golden Week holiday, while some were concerned about safety after the shooting at Siam Paragon on Oct 3.
Fresh concerns about fighting between Israel and Hamas militants could affect the flow of inbound tourists, particularly from the Middle East, resulting in a decline among arrivals to 480,000 next week, according to the ministry.
Tassapon Bijleveld, executive chairman of Asia Aviation, the holding company of Thai AirAsia, said the average load factor on Chinese routes remained weak at around 70% because of several negative factors.
He said the visa-free scheme is still regarded as an effective measure to attract the Chinese market, but Thai tourism cannot avoid a short-term lull because of reduced confidence in tourist safety.
Mr Tassapon said the official visit to China led by Prime Minister Srettha Thavisin and the Tourism and Sports Ministry next week should aim to restore confidence during the visa-free period, which ends in February next year, particularly as most tourists are still worried about both safety issues and a sluggish economy.
The impact of the Chinese market is a greater concern for aviation than the war in Israel, which has yet to affect airline operations in terms of fuel costs, he said.
Mr Tassapon said the price of jet fuel this week surprisingly dropped from US$120 per barrel to around $105, which requires monitoring over the next few days to determine a clearer pricing trend over the long run.
Phunut Thanalaopanich, president of the northern chapter of the Thai Hotels Association, said the Chinese market in Chiang Mai has not been robust this year.
Most Chinese tourists to Chiang Mai are families and did not abruptly cancel their bookings following the Bangkok shooting as they felt it was a single event that happened miles away, he said.
Mr Phunut said the average occupancy of hotels in Chiang Mai in October was 55%, a drop year-on-year, attributed to a sluggish domestic market.
“Typically the domestic market would fill up hotel rooms starting this month, but a longer rainy season this year prevented tourists from planning their trips,” he said.
Mr Phunut said tourism operators still believe the visa-free scheme will help restore the Chinese market in the next few months, but there are concerns about screening measures.
He said the government should ramp up security measures to prevent illegal businesses from exploiting the visa exemption because if reports about illegal firms and crimes targeting tourists circulate on Chinese social media, it would result in a slow recovery.