Thailand is set for travel growth in 2023

Known as the ‘Land of Smiles’, Thailand has long been a popular destination for many travellers. Before the COVID-19 pandemic, Thailand received 38.2 million travellers in 2018 and almost 40 million in 2019, making it the second most popular APAC destination visited by international travellers. After the first quarter of 2020, Thailand, like many other countries, had to shut its doors to tourists due to the pandemic, which severely impacted its tourism economy.

Made up of 77 provinces, Thailand offers tourists a little bit of everything—the hustle and bustle of the metropolitan city of Bangkok, the idyllic sandy beaches of Koh Samui and Pattaya, historical sites and monuments in many cities, and a whole lot of culture, tradition and authentic Thai experiences. In 2019, the travel and tourism industry contributed 21.9% to the country's GDP. However, according to data from the United Nations, it was estimated that Thailand, one of the countries most economically affected by the pandemic, would suffer about US$ 47 billion in revenue losses.

With the lifting of travel restrictions in Thailand in the second half of 2022, the country has started again seeing a steady flow of tourists. The government has estimated that it will be able to net approximately US$ 11 billion in the last two quarters of 2022, drawing in about 7.5 million tourists during this period. Optimistic about the 2023 travel and tourism outlook, the Thai Government has projected the industry's revenue to be approximately US$ 64.5 billion, taking it to about 80% of its pre-pandemic levels.

In a recent travel survey conducted by GMO Research of 3,328 respondents across multiple countries in the APAC region, 32.9% of those polled indicated that they would like to visit Thailand, making it amongst the top five countries to visit for leisure. These figures are highly encouraging for the Thailand travel industry, as the Southeast Asian country outranked popular leisure destinations such as New Zealand, Australia, the United States and Switzerland, amongst others.

Of those polled, 42.6% had indicated that they are ready to spend more than their pre-pandemic budgets, benefitting the travel economies of their destination countries (Chart 1). Thailand anticipates a 30% increase in average spending per trip for 2023 based on the 17% surge in tourist spending it has seen in the second quarter of 2022.

It was also reported in the survey that 46.3% of those who would like to visit Thailand aim to do so in 2023, as confidence in travelling continues to improve; 14.6% indicated that they would wait it out for another year before visiting Thailand, while 7.5% aim to travel before the end of 2022 (Chart 2). It is also worth noting that many travellers are also relying on first-hand information, such as web searches (57.6%), travel blogs (41.4%) and word of mouth from family and friends (40%) as their main sources of information before visiting an international destination.

Thailand will also be expecting a change in its tourist composition, especially with the main bulk of its pre-pandemic visitors, Chinese travellers, still under China's zero-COVID policy. In 2019, Chinese tourists made up 27.6% of Thailand's international visitors. However, between January to August of this year, Chinese tourists made up only 2.6% of Thailand's international visitors, with the bulk originating from other ASEAN countries.

With Thailand poised to see a steady influx of travellers, especially in the coming year, it is strengthening its travel and tourism infrastructure, deploying more personnel to handle the arrival surges. With Thailand's food and drinks being a pull factor for travellers, the F&B industry is also arming itself with awards and accolades, such as boosting the number of restaurants with prestigious Michelin star ratings. It will not be surprising if Thailand achieves its aims for the travel and tourism industry earlier than anticipated as the world continues to accept COVID-19 as endemic to populations.

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