After the death of 47 Chinese holidaymakers in a boating accident in July 2018, Chinese tourists visiting Thailand have declined by approximately 20% and Phuket, where the accident took place, is feeling this decline as Chinese tourism numbers dwindle and the destination is left with empty hotel rooms, bars, restaurants and clubs.
Phuket, along with Pattaya and Chang Mai are considered Thailand’s top-tier tourism destinations and are important pillars of the Thai economy, generating thousands of jobs and millions of dollar in tourism revenue.
But Phuket hotels are now facing a grim reality, that the Chinese aren’t visiting, and with an estimated 3,000 additional hotel rooms coming into the market, hoteliers are dropping their rates by 50% as they struggle to put bodies in their beds.
Chinese have not abandoned Thailand altogether. Figures from the Tourism Authority of Thailand (TAT) show that 2.2 million Chinese tourists visited Thailand in 2018, but figures for the January to September period of this year show a 20% decline in the Chinese visitor count.
Of course its not just Phuket that has seen a decline in its Chinese visitors, Pattaya and Koh Samui have also seen dramatic decreases in the number of Chinese visiting, and like their counterparts in Phuket, hoteliers are struggling to fill their rooms.
Phuket is one of the most scenic destinations in the world
According to Chinese tourism experts, Chinese visitors are skipping Thailand because of the extremely negative publicity following the deaths of Chinese tourists last year, coupled with the US-China trade war and the strong Thai Bhat, which has risen 10% this year against the Chinese Yuan and made travel to Thailand more expensive.
Instead of Thailand, Chinese tourists are looking for cheaper destinations to travel to and are visiting Cambodia, Laos, the Philippines and Vietnam. These four destinations are considered to be similar to Thailand, with three of them offering beach resorts and all offering tropical Southeast Asian experiences.
It’s also interesting to note that the composition of travelers is changing. Thailand is seen by many Chinese as a “wild” destination where tourists can engage in sex, drugs and rock and roll and it attracts younger, single Chinese and young couples. However, Chinese visiting Cambodia, Laos, the Philippines and Vietnam are seen as “less wild” and are therefore attractive to families and older travelers.
Tourism accounts for 18% of Thailand’s gross domestic product and Chinese tourists have been the largest segment of visitors to the country and Phuket has been considered the most visited and valuable destination in the country.
So as the Chinese market moves onto other destinations, who is going to visit Phuket and Thailand’s other top destinations? According to the TAT, the market that they intend to shift their focus to will be India. The TAT is now working with their advertising and marketing agencies to develop a brand statement that they think will be attractive in the India market and hoteliers and tour package operators are targeting Indian media offering familiarization / public relations tours to Thailand.