Thailand’s Inbound Tourism Situation in 2002
In 2002, apart from the unstable global situation that affected tourism in
many aspects including the economy, world oil prices, and terrorism in various
destinations, etc., Thailand’s inbound tourism grew reversely. The number of
foreign tourists visited Thailand expanded towards a good direction, exceeding
the expected rate as we received a total number of 10.79 million tourists, which
is a growth rate of 7% from the previous year (the expected number was10.50
million tourists, an expansion rate of 4%). The mentioned growth rate is almost
the same with the expansion rate of 7.9% of the Asian Pacific tourism. However,
it is higher compared to world tourism, whose growth rate was estimated by the
World Tourism Organization (WTO) to be 3%. It can be said that this year,
Thailand succeeded its tourism promotion.
There was a good expansion rate in almost every region except Oceania
and South Africa. Australia, the major market in Oceania, was affected by its
aviation problem as Qantas and British Airways have changed the transit stop
from Thailand to Singapore plus the terrorism in Bali in October; therefore,
a direct impact occurred to Australian tourists and their confidence in the
security system in attractions in Asia was also reduced. As for South Africa, the
tourism trend within the market has changed. Nevertheless, the tourism still
expanded in other markets. This is a result of the continuous sales promotion
and marketing, which supported Thailand’s tourism in a prospective direction.
Furthermore, when we look at each market, we can see tourists from
major markets, which the Tourism Authority of Thailand (TAT) set as high
potential markets and applied aggressive marketing strategies, received a larger
number of tourists than expected. These markets include Malaysia, Korea, China,
Russia, East Europe, the United Kingdom, Scandinavia, India, New Zealand,
and the United Arab Emirates. Likewise, Thailand was successful in capturing
more tourists from the high expenditure market segment of the top–end and
middle markets, family, and seniors. This reflected that Thailand’s policy to
attract the top–end market was very successful.
The tourism situation in 2003 is expected to continually grow despite the
fact that it is likely that war will happen between the US and Iraq. This is
because the war might not affect tourism in East Asia, Thailand’s main market.
Moreover, medium and long-haul markets like Oceania, the Middle East, and
some countries in Europe would prefer traveling to Asia, which is further away
from the war scene. These markets will grow at a moderate level. Thailand has a
policy to stay neutral and welcome tourists of all nationalities plus its value for money while the rest of the world is at a halt; these factors will benefit Thailand in maintaining its position of an interesting destination. However, the growth in the number of tourists might not be that high because of the unstable situation of the war and the world’s economy to follow.
The East Asian market had a growth rate of 7.71%, totaling 6,531,546 tourists. Markets that contained good expansion rates were Malaysia, China, Korea, and Japan. China, in particular, grew satisfactorily. Major supportive factors include tourism promotional atmosphere within China and Korea together with Thailand’s tourism promotion all year round. Moreover, the Chinese market also gained an advantage from an increasing of flights at the end of the year. The increased flights covered 3 flights/week for Bangkok– Xia Men
and Bangkok – Beijing by Thai Airways International Public Company Limited
and 2 flights/week for Beijing – Phuket by Air China. As for Malaysia, there
was a reduction in international arrivals to international airports excluding Bangkok International Airport. However, considering the tourism trend via the southern border, it was found that the growth rate was still satisfactory resulting in a good expansion rate of this market. Meanwhile, some markets retained their growth rate; for example, Singapore and Hong Kong. Some markets such as Taiwan faced a reduction in its growth rate. The reduction was caused by the inactive economic situation which resulted in careful expenditure of people, especially for tourism. However, the overall tourism situation of this region was not effected. The incident in Bali and the Philippines did not have an impact on these markets. In contrast, these created positive factors to Thailand’s coastal destinations as they are competitors of Bali.
The tourism situation of this region is expected to continually grow although it is foretold that the war between the U.S. and Iraq might occur. In case war breaks out, tourists from this region are likely to prefer traveling within the region to crossing regions. Therefore, it is predicted that the war would have a low impact on tourists from the region.
Thailand received a total number of 2,450,878 tourists from Europe with a growth rate of 6.35%. Generally, the number of tourists from this region consistently grew all year. Important markets with good expansion include the United Kingdom, France, Italy, Switzerland, Russia, Denmark, Finland, and East Europe. Some large markets like Germany and Sweden faced a dramatic slow down since the beginning of the year and had a growth rate of 1.31% and 0.97%, respectively. Main factors to this halt are a decreasing of flights from Frankfurt – Bangkok by Qantas and British Airways as well as a halt of the
economy in both countries plus the current news on insecurity in these countries as a result of the incident in Bali. The mentioned factors caused a dramatic slow down in 2002 to Germany and Sweden, which are large markets with a good rate of expansion.
In 2003, the tourism situation of Europe might not largely expand. It will probably retain the same or experience a little lower growth rate compared to 2002. This is because Europe is still concerned about the global situation together with terrorism, which targets various countries in Europe, and the war between the U.S. and Iraq is trying to involve Europe into the controversy. The world oil prices fluctuate depending on the disagreement between the U.S. and Iraq. The unstable world oil prices have a direct impact on the tourism capital of European tourists in traveling a far distance. The stronger value of the Euro currency will affect the export of this region. This will further affect the economy of Germany, Sweden, France, and Italy. In conclusion, in 2003, major European markets that Thailand should be concerned about are Germany, Italy, Sweden, France, the Netherlands, and Norway while the United Kingdom, Russia, Switzerland, and East Europe will still expand.
The overall situation of the Americas grew moderately with an expansion rate of 5.98%, an equivalent of 640,143 tourists. This expansion rate is consistent with that of the major market of the U.S., whose growth rate is 5.06%, totaling 485,276 tourists. There is still an impact of terrorism in the U.S. that resulted in a reduction of tourism growth in this region, especially from the U.S. in the first half of the year. Later, the market recovered gradually especially in the beginning. In the third quarter, the market began to experience a dramatic increase in the growth rate replacing the reduction of the same period of the previous year. This is a result of the U.S. economy that gradually improved assuring the American people to spend more. The panic of terrorism reduced its psychological effect of American tourist behaviour. We can see that although
the U.S. regularly announced a warning for Americans all over the world to be more careful about terrorist attacks and to avoid traveling to risky areas of South Asia, the Middle East, Africa, and Southeast Asia including Thailand, the announcement did not affect international arrivals of Americans. This is partly because Thailand still maintains its neutral image as a peaceful destination with value of money. These are like magnets that attract more tourists from this region to choose Thailand as a destination.
The economic recovery of the U.S. also has a positive impact towards other markets within the region, especially Canada and Latin America that have economic relations with the U.S. Clear evidence can be observed in Brazil and Canada, who came back on track with a strong positive movement and a continuous satisfactory improvement all year. Canada gained an additional supportive factor by joint Toronto – Bangkok flights of Air Canada and Thai
Airways International Public Company Limited.
It is predicted that this market will moderately grow or achieve a rather low growth rate in 2003. An outside factor that might affect the market is the risk of terrorist attacks and the concern about the war between the U.S. and Iraq.
There was a rather high expansion rate of 17.25% in the overall
international arrivals from the region. In other words, Thailand received 309,745 tourists within South Asia. We received an increasing number of visitors from almost every market within the region except Pakistan that faced a dramatic slow down. Apart from the impact of the U.S. attack in Afghanistan, which resulted in an unstable political situation all over the region and an uncertain internal social status caused by groups of people in various countries, the crisis affected the market only for a short period of time. This is because South Asian people are familiar with the unstable situations within their own countries; therefore, the panic or psychological effect on the people was not tense. The market started to recover rapidly since the second quarter of 2002.
India, the major market that TAT applied an aggressive marketing
strategy with, experienced an increasing growth rate of 22.79% totaling 253,110 tourists especially an outstanding expansion of group tours and visitors for medical check – ups and treatments as well as visitors on business trips, which is
very popular in the market. As the U.S. and the U.K. as well as other destinations in the Middle East, Africa, and some countries in Southeast Asia, is at risk for security issues, Thailand became a destination with high advantages.
It is expected that the market will continue to grow strongly until the beginning of 2003. However, tourism promotion among markets in Southeast Asia must be processed with care, as there has been a group of people imitating documents for entrance to the kingdom. These groups have been proven to be Indian, Pakistani, Sri Lanka, and Nepalese nationals.
International arrivals of tourists from this region totaled 423,501, which is a decrease of 0.98% from the previous year. The reduction occurred continually since the second quarter as a result of the changing of the transit destination from Thailand to Singapore of the Australia–Europe route by Qantas and British
Airways. This created an obstacle in traveling from Australia to Thailand. At the end of last year, Thailand also received an impact from the rumor about terrorism in various attractions of Thailand; for example, Phuket and Pattaya as a result of the incident in Bali plus the Australian economy was giving a sign of entering a halt during the second half of 2002. The mentioned factors resulted in a reduction of the growth rate in Oceania. Although the minor market like New Zealand still continued to expand from last year, it cannot accelerate the overall expansion of this region as New Zealand is a small market.
It is predicted that in 2003, the unstable global situation will still have a psychological effect on tourist behaviour. Tourists are concerned about being a target of a terrorist attack, as the region expressed its stand point of being an ally to the U.S. in the war against Iraq. The positive factor for the region in 2003 is that Thai Airways International Public Company Limited is planning to increase the number of flights from Australia–Thailand. This is expected to help alleviate
the decreasing of flights last year. In conclusion, it is hoped that the tourism situation of Oceania will still be retained, and if the global situation is not worse, only a small number of tourists from Oceania is likely to increase.
The Middle East enjoyed a satisfactory movement with an increasing expansion rate of 14.98% or 272,805 tourists. Every market within this region contained a positive direction of growth regardless of the unsatisfactory condition at the end of 2001, as a result of the terrorism attack in the U.S. and the U.S. attack in Afghanistan, which caused an effect only for a short period. The tourism trend of visitors in this market returned to normal at the beginning of 2002, especially Israel and the minor markets of the United Arab Emirates and Kuwait. These countries adapted quickly and resumed an outstanding expansion. Part of the indirect factor to this is that various countries in Europe
and the Americas as well as some Asian countries increased strict measures on visa approval specifically for people of Arab nationality causing inconvenience in tourism for visitors from this market. Meanwhile, Thailand still maintained its image of a neutral destination, welcomed tourist of all nationalities, and offered fair tourism prices, the Arabs were, therefore, interested in the country. Since the second quarter, Arab tourists changed their plan to travel more to Asia, especially Thailand rather than Europe and America. Thailand’s sales promotion in the markets of the Middle East in May, which presented new tourism products such as health, spa, and medical treatments, responded greatly to the demand of the market and is a popular new tendency.
Since the third quarter of 2002, the market was affected by the incident of the U.S. weapons inspection in Iraq and preparation to attack the country. This has caused panic to the people of the Middle East for fear of a second Gulf War that is expected to be more violent than the first one. The tourism of this market is not much affected by this factor, as we can see that Thailand still continuously received an increasing number of tourists from this region. Connecting flights from major cities in the region including Abu Dhabi, Bahrain, and Dubai, to Bangkok were increased in the winter flight schedule of 2002/3 in order to respond to the expanding demand of visitors from this market.
In 2003, it is predicted that the market will still retain its positive movement although it will not achieve a very high growth rate as a result of the U.S. military operation in Iraq as well as the violent solution for Israel and Palestine in settling their disagreement, which began to have more influence on the reduction of the market expansion.
The overall growth rate of this market reduced 1.66%, a total of 89,449
tourists. South Africa, the major market, experienced a slow down with a growth rate of 10.24% or 37,721 tourists. The African market did not receive much impact from the incident in the U.S., as we can see from the consistent increasing number of tourists from South Africa to Thailand until the end of last year. However, as we entered 2002, the tourism trend of tourists from this market continually decreased although a positive factor was the sales promotion of South African Airlines; passengers who purchased 2 business class air tickets for the route Bangkok–Johannesburg received another ticket for free. The
promotion was aimed to attract businesspeople and the top–end market.
Unfortunately, it did not receive the expected response. The inconsistency of rapid change is a characteristic of this market; therefore, it is hard to predict whether or not tourists from this market will continue to increase. As Thailand is a far destination, it is impossible to avoid dramatic changes of the situation. In conclusion, it is expected that Africa will retain its negative movement in 2003.
Thailand’s Outbound Tourism Situation
In 2002, the number of Thailand’s outbound tourists totaled 2,249,639,
which was an increase of 11.89%. This is considered a rather high expansion compared to the growth rate of the previous year, which equaled 5.33%. This is a result of the improved economy of Thailand, which caused a psychological effect to Thai tourists. They were encouraged to spend more money on overseas trips. Regional trips to Malaysia, Singapore, and China, respectively, were the most popular among the Thai tourists. Various countries in East Asia adopted a tourism promotional policy for the economic improvement in each country; therefore, there was huge marketing and public relations in Thailand especially by our neighbouring countries such as Malaysia and Singapore. China is a very attractive destination for the world’s tourists, as it is a new opening country that is abundant with things to be discovered and is also Asia’s giant economic country. These factors encouraged more Thai tourists to travel to the mentioned destinations.
Details on Tourists
Despite the unstable situation of the global tourism industry, the year 2002 continued to experience an expansion in the number of international arrivals to the country at a rate of 7.33 percent, attracting 10.8 million visitors. Almost all markets enjoyed certain rates of growth except for Oceania and Africa. East Asia still maintained the largest market share with 6.53 million tourists. The average length of stay was 7.98 days, a slight increase from the previous year which was at 7.93 days. The length of stay was mostly due to the expansion of stay by tourists from the Americas, Oceania and the Middle East, resulting in a total stay of 86.14 million tourist nights, an increase of 7.95 percent.
More than half of the international tourist arrivals to Thailand in 2002 were first-time visitors, which was the group that experienced quite a rapid expansion in almost every market except for Africa, whereas the growth rate was not as high for the Revisits although there was still uninterrupted traffic by this group.
Package tour travelling with a travel agency experienced a high expansion rate in almost all regions except for Africa. As a consequence, the market share increased slightly from 42.14 percent in 2001 to 45.66 percent in 2002. This was consistent with the tourist behaviour that was mostly first-time visitors.
The expansion rates of male and female tourist arrivals to Thailand were slightly different. Male tourists still had a higher market share than females, at a proportion of 60:40 percent or 6. 43:4.37 million.
There was also a slight difference of the two highest market shares of Tourist Arrivals by Age, which belonged to the 25-34-year-old group and the 35-44-year-old one, resulting in an average age of 39.61 years. The main Purpose of Visit was still for holiday with a proportion of 89.26 percent or an increase of 8.59 percent. Most of the international tourist arrivals to the country as classified by occupation were commercial personnel and labourers. Tourists arrivals to Thailand in 2002 mostly stayed in hotel accommodation.