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12 Oct 2007

Tourism

Uprising in Myanmar: A Blow to Thai-Burmese Tourism Normally Worth Over THB2 Billion (Business Brief No.2051)

The anti-government demonstrations against increased fuel prices have led to bloodshed due to the Myanmar military regime's brutal crackdowns on civilians and monks as well as severe restrictions on external communications. A ban on outbound tour activities and stringent controls on movements along the Thai-Burmese border have adversely affected Burmese tourism – a major income earner that helps sustain their country's economy under sanctions imposed by the US and Europe because of the precarious human rights situation there. Up until recently, the tourism sector generated more than THB6 billion in revenue to Myanmar each year.
Tourism between Thailand and Myanmar that was expected to generate some THB2.3 billion in 2007 is poised to fall over the remainder of this year due to the Burmese uprising. Thailand ranks first as a tourism market in Myanmar. KASIKORN RESEARCH CENTER (KResearch) forecasts that the number of Thai tourists making trips to Myanmar may rise by 30 percent to 35,000, generating around THB850 million in revenue to Myanmar, up 21 percent, year-on-year (excluding a large number of foreign tourists traveling to Myanmar via Thailand).
At the same time, Myanmar is one of the key tourism markets in ASEAN for Thailand. KASIKORN RESEARCH CENTER (KResearch) expects that Burmese tourist arrivals in 2007 may advance by 16 percent to some 78,000 (excluding day tourists visiting Thailand through the border checkpoints and illegal Burmese laborers). Thailand is therefore likely to gain some THB1.450 billion in tourism revenue this year, up 60 percent over last year.
The unrest in Myanmar is set to undermine Thai tourists' confidence toward personal security there over the remainder of this year. Meanwhile, that situation will also prevent Burmese travelers from visiting Thailand because of the military government's ban on outbound tour arrangements. KResearch therefore forecasts that tourism between Thailand and Myanmar will bear the brunt of this violence, cutting traveling between the two countries by more than 60 percent during the final quarter of this year. This is likely to cost the tourism sectors of both countries some THB480 million in lost revenue. We thus predict that tourism-related income between the two countries will total THB1.82 billion, down from the earlier projection of some THB2.3 billion.
Violence in Myanmar is also tending to affect the country's overall tourism, meaning that in the last quarter of the year – which is the tourism high season for visitors from Europe, as they will be uncertain about safety in traveling to Myanmar, and a substantial number of foreign tourists oppose the violence toward the general populace and monks that has resulted in foreign tourists in Myanmar gradually departing the country. At present, there are only a few foreign visitors there. Most of them are businesspersons who have a trade or investment necessity for being in Myanmar. Foreign tourists who plan to visit Myanmar at the end of this year have shifted their travel plans to other countries in Indochina instead, e.g., Laos, Cambodia, Vietnam and Thailand. Therefore, it is projected that for the entirety of 2007, there will be 600,000 foreign tourists traveling to Myanmar, falling 20 percent from the previous forecast of 750,000. This will affect Myanmar's income from tourism to fall around USD40 million to only USD160 million, differing from the prior forecast of USD200 million.

However, concerned agencies in Thailand – both public and private – should turn the crisis in Myanmar to an opportunity for Thailand to expand our foreign tourist market during the upcoming high season. Marketing strategies should be applied to attract foreign tourists to switch their travel plans to Thailand. The problem of insufficient accommodation in key tourism cities should be solved by dispersing tourists to other smaller tourism venues that can support a large number of tourists in the upcoming high season.

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