A massive earthquake that has struck off the northeast of Japan, triggering a tsunami and nuclear meltdown, is the worst natural disaster to hit Japan in recent times.It has been preliminarily estimated that the devastation could cost at least USD100 billion in economic losses to Japan. The official number of dead and missing victims due to the earthquake and tsunami in Japan, as of March 18, grew to 16,600, while hundreds of thousands of people remain homeless, and many said to be living in shelters, while at least 800,000 homes are without electricity amid freezing temperatures.
KResearch sees the impact of the latest disaster on Thai tourism in two scenarios (as compared to our pre-disaster projection that about 1.2 million Japanese tourists would visit Thailand this year, earning us about THB38 billion in tourism income), as follows.
Base scenario: If rehabilitation and reconstruction programs in the aftermath of the disaster are quickly completed, resulting in a rebound in the number of Japanese tourists to Thailand in 4Q11, KResearch expects that about 850,000 Japanese tourists may visit Thailand in 2011, down 12 percent from last year. That figure would translate into tourism revenues of about THB23 billion, down 23 percent from last year. If that figure is compared with our earlier projection, it is expected that Thailand would see a shortfall of some THB15 billion in tourism revenues.
Second scenario: If the rehabilitation and reconstruction programs are delayed, resulting in fewer Japanese tourists visiting Thailand through to the end of 2011, KResearch expects that only about 700,000 Japanese tourists may visit Thailand this year, down 28 percent from last year. That figure would translate into tourism revenue of some THB18 billion, down 40 percent from last year. If that figure is compared with our earlier estimate, Thailand would then lose as much as THB20 billion in tourism income.
Nevertheless, KResearch is of the view that our international tourist market overall in 2011 will continue to be supported by improvements in arrivals from China, South Korea, India, Scandinavia and Russia. As a result, the number of international arrivals may increase over our projection to 17-17.15 million tourists, helping to generate at least THB15-20 billion in tourism income.
Meanwhile, in an attempt to diversify foreseeable risks stemming from the recent disasters in Japan, it is expected that Japan will want to expand long-term accommodation for their elderly population into other nations that offer safe and economical stays. As a result, Thailand should stand to benefit from this trend, given our sufficient tourism resources, and a cost of living that is less expensive than many neighboring countries. Such expanded long-stay tourism into Thailand would not only help to solve an oversupply problem in our hotel and property markets, but also help bolster income and expand related travel business within the country.