Thailand relies on the tourism sector, especially international tourism -- the industry is one of top three revenue generating for the country.
Given the pandemic restrictions which have been imposed since 2020, international tourism has been frozen for more than two years, which has a devastating impact on tourism destinations, businesses and other related sectors.
The effects were far and wide. Swathes of tour operators and hotels were forced to permanently close their doors.
Countless firms within the tourism sector have experienced substantial cash flow problems. It goes without saying that tourism businesses, such as tour operators, hotels and airlines, have suffered from this "zero tourism" situation.
This pandemic hits not only on tourism businesses, but also other related sectors. For instance, when tour operators received no tourist group, bus and boat drivers had no job while restaurants and eateries also welcomed less customers.
The negative effect is not only felt by restaurant owners, but employees and street food vendors are also affected. Once, the consumption demand has been reduced, food producers inevitably feel the indirect impact of the travel suspension.
These are just a few examples of the pandemic's impact on the tourism sector and Thailand's economy.
Rebuilding tourism is a priority
To survive the pandemic, focus has been shifted to the domestic market to attract local tourists. What we have witnessed is that in latter part of 2020, the government gradually lifted travel bans and encouraged travel among domestic tourists by providing various incentives linked to a variety of tourism businesses, such as tour operators, hotels, airlines and restaurants.
The strategy of encouraging domestic tourism has been employed by many countries to revive tourism activities within their borders and mitigate the impact of the pandemic on jobs and businesses. Even though this may not generate a significant economic impact, compared to the international tourism, this stimulus is vital because a country should not remain in the "zero tourism" situation any longer.
Real economic recovery will only be possible when international tourism returns to the pre-Covid scale. We are, currently, attempting to bring back international tourists. This month, more tourists started to return. The Chinese outbound market used to be a crucial market source for Thailand due to the high number of tourist arrivals and expenditures. However, this might be an important opportunity to seek new and diverse markets since it is difficult to predict when the Chinese government will fully open China's border.
That said, government support is essential in helping the tourism ecosystem and local economy survive the pandemic amid the tourism sector's recovery process. The Organization for Economic Co-operation and Development suggests key policies to build this recovery, such as restoring traveller confidence, promoting domestic tourism, supporting the safe return of international tourism, strengthening cooperation within and between countries and building a more resilient and sustainable tourism industry.
Marketing and communication strategies are vital. The Tourism Authority of Thailand has been actively working to promote tourism, both domestically and internationally. Destinations and businesses also need to rethink product and service design and marketing communication to properly attract target segments. There are many travel trends that tourism businesses should consider to better prepare and adjust for the resurgence of tourism.
We are still living in an unpredictable era that demands high levels of contingency planning and comprehensive travel insurance. Fully refundable and free date changes bookings are favourable. The short-distance travel market performs better than the long-haul one as flying across the world in a plane is more expensive.
Self-driven tourism has also become more popular during the pandemic as it provides more flexibility, mobility and privacy. Last but not least, quieter destinations are preferred destinations since people try to avoid going to crowded places.
Tourism recovery plan
According to the World Bank's latest report, economic activity is expected to return to pre-pandemic levels by end of this year, with continued progress on vaccinations and the resumption of tourist arrivals supporting the recovery.
The number of international tourists is projected to rise to almost 7 million this year, with a sharp increase in the second half of the year, before increasing further to about 20 million arrivals next year -- still just half the 2019 level.
However, we can see a positive signal from this forecast. In the past couple of years, people all over the world have increasingly used digital technology.
A study from World Bank suggests that the adoption of digital technologies has the potential to support Thailand's post-pandemic recovery while enhancing its competitiveness over the longer term.
E-commerce is an especially important outlet for small and medium enterprises in Thailand, as it reduces transaction costs and allows entrepreneurs to reach new markets.
Various technology-related skills, such as information management, user experience design, integrated systems technology, cloud computing and the Internet of Things, are in high demand, but supply is inadequate.
Knowledge on digital technology and the enhancement of skills are crucial in increasing Thailand's tourism competitiveness. Collaboration between education and tourism businesses to design curriculum and help align training with the industry demand can also create a positive impact.
It is important to identify the new and emerging digital skills needed to cater to workforce supply and demand. The education sector is essential to the future supply of skills for the tourism sector as well as the contribution of skills that support digitisation transformations in Thailand's tourism industry.
Laddawan Jianvittayakit is Program Director at Tourism and Hospitality Management, Mahidol University International College.
