Bank of Thailand issues sombre warning - ongoing ban on returning foreign tourists to have even worse impact next year

7 Jul 2022

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The Bank of Thailand has issued a sombre warning that the ongoing ban on returning foreign tourists may have an even worse impact next year. Don Nakornthab, from the economic and political department of the BOT, says that if international tourists are not allowed back to the country soon, next year the tourism industry in Thailand will face even greater threats. 

A report in the Bangkok Post says that both the Ministry of Tourism and Sports and the National Council for Economic and Social Development have already reduced their forecasts of foreign tourists this year to 6.7 million (the vast majority of that number arriving in Q1 2020) and 12 million by 2021. To put that in context, Thailand welcomed nearly 40 million international tourists in 2019, with the resulting revenue representing nearly 20 per cent of the Thai GDP as a whole. 

The month of July was the fourth consecutive month Thailand did not receive foreign tourists. The frontiers remain largely sealed, while discussions continue on how to safely open. The government, having successfully suppressed Covid-19, appears very cautious about opening up too quickly, potentially inviting the virus to resurge. A number of 'plans' and 'models' have been announced but no confirmation has been given that any of these are definitely being implemented. 

But Don says it's imperative officials are now taking steps to resurrect international tourism and start repairing the devastated economy. 

"If foreign travellers are still unable to visit the country, next year this will have a more severe impact on Thailand's economic growth. The government should strike a balance between measures for tourism and containment of the outbreak.' 

The BOT concedes that, as shown by places like Hong Kong and Singapore, the possibility of a second wave can not be ruled out. Don maintains, however, that a rate of 20 to 30 new cases a day is likely to be manageable. 

Meanwhile, due to increased public spending, a further relaxation of the Covid-19 restrictions during the month of July has caused a slight improvement in the economy. Compared to the same time last year, exports shrank by nearly 12 per cent, but this was less than almost 25 per cent contraction seen in June. But, while employment figures have improved slightly, the overall picture remains bleak due to a decrease in the number of employees affected by the temporary closure of their place of work.

Source Thaiger