Thailand could make visitors pay much more for hotels than locals

A proposed dual-tariff structure would see tourists changed 2019-level hotel rates while locals enjoy deep discounts.

By Bloomberg News, July 7 2022
Thailand could make visitors pay much more for hotels than locals

Foreign tourists may soon find Thailand a more expensive destination than in the past two years with the country now planning to raise hotel rates to pre-pandemic levels to support a faster recovery of the industry.

Thailand’s tourism ministry plans to ask hotel operators to implement a dual-tariff structure under which foreign visitors may be charged rates similar to pre-pandemic days while locals may continue to enjoy discounted rates, Traisuree Taisaranakul, a government spokeswoman said in a statement on Wednesday.

“This is to maintain our standards of rates and services for foreign tourists, which affects the perception of country’s tourism brand,” Traisuree said. “Rates that have been reduced during Covid-19 will be maintained for Thais to sustain the momentum of domestic tourism.”

Hotels in tourism hotspots such as Bangkok, Phuket, Krabi and Koh Samui continue to offer huge discounts to draw back visitors after the pandemic pushed room occupancy rates to about 30%.

While there was no immediate response to the proposal from hotel operators, the tourism ministry and the Tourism Authority of Thailand will soon hold talks with the Hotel Association of Thailand about the dual pricing plan, according to Traisuree.

While the Southeast Asian country has scrapped all Covid-related travel restrictions, the tourism sector is still reeling from heavy losses accumulated during the pandemic. Thailand expects 9.3 million foreign arrivals this year, a fraction of the 40 million tourists it received in 2019.

Arrivals are expected to reach 24 million, or around 60% of pre-pandemic levels, by 2024, the World Bank said in a report last week.

Despite removing the last of its pandemic-related travel restrictions, the nation’s once-vibrant tourism industry still faces plenty of challenges on its long road to recovery, not least the continued absence of big-spending Chinese visitors.

“Chinese tourists are a key factor to the recovery,” said Suksit Suvunditkul, president of Thai Hotels Association’s southern chapter.

Phuket is particularly popular with Chinese visitors, he said. “They used to fill every hotel, everywhere, whether seaside or downtown, all year round.”

Anyone can now travel to the Southeast Asian country without having to register for a so-called Thailand Pass before arriving, the last entry requirement after Thailand had ditched all other Covid entry rules.

But while the earlier dismantling of other, more onerous rules such as quarantine has helped lure some visitors back to the country, Thai businesses still desperately need a bigger influx of customers after Covid torched international travel and left tourist hotspots deserted.

“Tourists will return, but our survival will be challenging,” Tourism Council of Thailand President Chamnan Srisawat said. “Less than half of tourism businesses have resumed, and those that are open again don’t have enough customers to operate profitably.”

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