News for the Hospitality Executive
|By Nondhanada Intarakomalyasut, Bangkok Post, Thailand
Knight Ridder/Tribune Business News
Jan. 7, 2004 - The Tourism Authority of Thailand (TAT) has become more progressive, even outrageous, these days in setting growth targets for the country's tourism industry, projecting a whopping threefold jump in arrivals over the next seven years to 30 million in 2010.
TAT governor Juthamas Siriwan released the new target this week. But industry leaders shook their heads in disagreement as they suggested the country should opt for quality rather than quantity.
There are also questions emerging as to how the country's tourism infrastructure could be developed to cope with the massive rise in tourist flows.
Vichit Na Ranong, chairman of the Tourism Council of Thailand, expressed concern that such dramatic growth might damage the tourism sector, as it would likely to draw mass-market tourists with low spending to the country.
At the same time, he raised the question on the readiness of facilities to support the significant growth, particularly flight availability and hotel rooms.
But more importantly, even if the country could build facilities such as new hotels, the drastic change could hurt the overall economy from the oversupply of services.
"Look at the Philippines when it aggressively built many hotels during the World Bank meeting and when the event was over, the hotel industry was left in a bad shape for almost ten years," said Mr Vichit.
He suggested that the government focus on increasing average spending per tourist instead of concentrating on the number of arrivals.
"At the end of the day, we need the money, not the number of tourists, and imagine if Thailand drew many more mass-market visitors -- the facilities would be run down and the whole image of the country's tourism would change," said Mr Vichit.
With a large number of visitors, the industry could be dominated by one particular market like China, he said.
As well, to handle 30 million tourists, the country has to properly distribute visitors to different parts of the country to create a balance in the industry which means more areas need to be promoted.
Prakit Chinamornpong, secretary-general of the Thai Hotels Association (THA), said it was quite impossible to have 30 million tourists within the next seven years.
"With such a target, it means we have to grow by about 20 percent every year," said Mr Prakit.
Past growth records in the last two decades showed that Thailand had rarely achieved over 20 percent annual growth, except 1987 and 1988 when tourist arrivals were only about 3-4 million.
Over the past 10 years, the growth rate was between 1 percent and 12 percent while the latest figures showed the number of tourists dropped from 10.8 million in 2002 to 9.8 million in 2003, mainly because of the Sars outbreak and the war in Iraq.
Mr Prakit also said the government's bid to add 300,000 new hotel rooms over the next three years to support the national tourism growth plan was ambitious but it had to provide extensive incentives to attract investors.
He said the industry had to be careful before investing in new hotels as it could create an oversupply if the goal was not achievable.
On the 10-billion-baht low-interest fund to support hotel operators in their bid to renovate their properties or invest in new projects, Mr Prakit said he was concerned about the procedures for obtaining loans.
"In the past, when the government wanted to lend a helping hand by granting low-interest loans for hotels, the process was so complex that only few hotels could apply for loans," he said.
However, Mrs Juthamas said the government had set a high target to encourage both the public and private sectors to try harder. After all, she said, tourism was one of the country's highest foreign revenue earners.
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(c) 2004, Bangkok Post, Thailand. Distributed by Knight Ridder/Tribune Business News.