30 Jun, 2014

Thai private sector’s wish-list of tourism recovery strategies and actions

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Hua Hin — Senior executives of the Tourism Authority of Thailand from head office and worldwide are to start their 2014-15 marketing planning meetings here today with a clear focus on campaigns to recover from the 8-month political unrest. The recovery campaign is likely to draw upon the recommendations of the Tourism Council of Thailand, the umbrella grouping of the country’s private sector travel groupings, which in early June crafted a long wish-list of items it would like to see the military regime implement in order to take advantage of the restored stability.

There is a sense of urgency. It’s been a bad start to 2014, with January-May arrivals of 10.35 million, down 5.9% over 11 million in the same period of 2013. However, there are silver linings. The short-haul Asian markets which were worst hit are expected to be fairly easy to bring back with price-driven tactical campaigns. Many of the European countries as well as others such as Australia and South Africa actually reported growth all through this period. Low-cost airlines are proving their mettle by ferrying passengers directly to secondary destinations such as Krabi and Phuket.

The following unofficial translation of the TCT’s wish-list also provides a readymade crisis recovery roadmap for other countries facing similar challenges, or likely to face them in future.

Proposed guidelines for reviving tourism — by the Tourism Council of Thailand.

Introduction

1. The Thai tourism industry has experienced growth for more than 54 years and is now one of the highest economic income earners, accounting for 10% of Gross Domestic Product, creating direct and indirect jobs for more than 8 million people and contributing to the distribution of income nationwide. Visitor arrivals in the past 10 years have enjoyed an average annual growth rate of 12.79% with 2013 recording 26.55 million arrivals, generating 1,171 billion baht in revenue. But looking at the big picture, the tourism industry can generate 1,800 billion baht.

2. The public and private agencies that supervise tourism directly include the Ministry of Tourism and Sports (which includes the TAT), the Thailand Convention & Exhibition Bureau (TCEB), the Designated Area for Sustainable Tourism Administration (DASTA) and the Thailand Tourism Council.

3. The Thailand Tourism Council was established under the Tourism Council Act 2001 to represent the private sector in co-operation with the government and recommend policies that benefit the development and promotion of Thailand’s tourism industry.

4. However, it is regrettable that for 10 years, the growth of the tourism industry has been impacted by economic crises, natural disasters and internal conflict, as well as various structural issues that have built up over time. These include:

4.1 Problems with the management of various tourism related organizations which are scattered, lacking in integration and direction, causing disconnection.

4.2 Problems of insecurity of lives and property while travelling in the country and problems of tourist scams and exploitation.

4.3 Problems related to congestion and deterioration of tourist sites and lack of development of new sites with future potential.

4.4 Inability to generate higher value added for tourism goods and services, leading to increased expenses and affecting visitor impressions.

Proposals to rehabilitate Thai tourism

Urgent measures (two-month period)

1. Let the head of NCPO (the National Council for Peace and Order, the name under which the military government is presently running Thailand) Chair a National Tourism Policy Committee (NTPC), under the National Tourism Policy Act 2008 as the mechanism to define policy and manage tourism in a cohesive manner at the national, regional and local levels so that tourism management is independent and appropriate. According to the Act, 14 governmental agencies are involved. The most important issues that the NTPC should tackle is the integration of all tourism related work in order to generate maximum benefit, enhance communication and create understanding, thereby boosting visitor confidence, solving the problem of influential figures, etc. To ensure effectiveness, the NTPC should be upgraded to an office similar to the Board of Investment to prevent duplication and increase cohesion.

2. Suppress local influential figures in tourist locations that affect the safety of tourists, such as in Suvarnabhumi airport, in front of the Grand Palace as well as in various parts of Phuket, Chiang Mai and Samui.

3. Do urgent positive PR for the world to understand the present situation and ensure that news from both the public and private sector is consistent. Other than that, rely on direct communication by tourists who come to Thailand and target high potential markets which can recover quickly such as the Asian countries which now accounts for 65% of the total. Involve the private sector in defining target markets and participating in all promotional and marketing activities.

3.1 Promote mega events such as international sporting events or concerts that create a good image for Thailand.

3.2 Arrange Mega Famtrip focussed specially on the off season period;

3.3 Organise roadshows in markets that can bounce back quickly, such as China, Japan, Korea, Russia.

3.4 Create incentives for airlines to bring back visitors.

3.5 Create guarantees for the safety of tourists. Compensation may be offered for accidents within the country, as travel advisories are impeding the tourists’ ability to get travel insurance.

4 Implement measures to stimulate domestic tourism to promote economic recovery and create reconciliation, such as:

4.1 Let government and state enterprises arrange seminars and field trips to upcountry destinations.

4.2 Consider allowing civil servants, state employees and private sector employees to adjust various public holidays alongside weekends (Sat-Sun) to have more long weekends as a means of stimulating domestic tourism.

4.3 Offer tourism prizes to civil servants, soldiers, police and top students all over Thailand within a 10,000 baht limit.

4.4 Allow up to 20,000 baht in personal income tax deductions for domestic tourism expenses including accommodation and legally registered tourism companies

4.5 Allow tax-deductions for private company seminar and incentives expenses.

5. Measures to mitigate the impact for tour operators

5.1 Have state owned banks give low interest loans to tour operators to improve and upgrade their services as well as to improve cash flow by allocating a separate budget for tourism because approvals require different criteria from other industries.

5.2 Grant an extension in tax deadlines between 2014-2015 such as property tax and local maintenance tax by collecting 50% up front and the remainder within the next 2 years.

6. Introduce measures to support and encourage tourism, such as:

6.1 Lower the cost of entry to various sales promotion events in Thailand and abroad organised by the TAT and TCEB to encourage operators to participate.

6.2 Give free entry to tourist attractions nationwide for a short period.

6.3 Waive Chinese visa fees for 6 months as well as increase the processing speed and convenience of Visa on Arrival.

6.4 Let Thai Airways pioneer a “Big Promotion” of attractively priced fares in cooperation with the private sector.

6.5 Reduce Airport Tax by 50%.

Measures in the medium term (one year).

1. Accelerate expansion of international and regional airports which are gateways to Thailand and important links with neighbouring countries, Suvarnabhumi must get priority, especially the issue of construction of a third runway.

2. Accelerate construction of the extension to Phuket airport as well as upgrade U-Tapao (naval base airfield, south of Pattaya) to a full commercial airport to help alleviate the capacity of Suvarnabhumi, the main gateway airport in Bangkok.

3. Halve the various aviation-related charges especially those levied by the civil service and state enterprises such as Aerothai, Department of Civil Aviation, and Airports of Thailand for a minimum of two years.

4. Curb erosion in the Gulf of Thailand especially around Cha-am and Hua Hin as well as encroachment of local communities which have constructed roads into the sand for convenience in fishing causing the water to change directions as well as building piers for fishing vessels which is a hindrance to travel.

5. Reduce the TOU electrical rate for large hotels in the same way as small hotels which at present is 5%. The rate should be in the same range as industrial factories.

6. Reform tourism-related laws to better reflect the present situation and bring them under the supervision of one organisation.

7. Improve the procedure for registration of a travel company in order to increase the quality and standards of operators.

8. Encourage investment in tourism businesses

8.1 Support the establishment of new attractions.

8.2 Encourage the renovation of hotels and theme parks to create quality tourism and encourage the maintenance or upgrading of standards for visitors, reduce energy consumption and environmental pollution in order to maintain a positive image of Thai tourism.

9. Update the fee structure of national parks to take into account the participation of tour operators and the community as well as upgrade park facilities to meet international standards.

10. Improve IT systems and install Free High Speed Internet at tourist attractions to facilitate tourists and allow them to help promote tourist sites.

11. Implement a main tourism campaign such as Visit Thailand Year to be conducted and coordinated by both the public and private sectors.

12. Organise safe and convenient public transport in tourist cities.

13. Create a standards system for tourism goods and services to increase quality and competitiveness via an agreement between Ministry of Industry, the Ministry of Tourism and Sports, and the Thai Tourism Council. The law governing the various organisations has given them charge of standards, therefore objectives should be separated clearly so that the Ministry of Industry coordinates and establishes the big picture, the Ministry of Tourism and Sports defines standards for various activities and the Tourism Council creates the accreditation system for tour operators.

Dated: June 5, 2014.