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5 Jul 2021

Econ Digest

Plan to reopen the country to international tourists: hopes and challenges that determine the fate of Thai tourism


        The publicity of the regulation on “Thailand’s Tourism Reopening Scheme”, which comes into effect on July 1, 2021, on the Ratchakitcha website (Government Gazette), is the move that allow the second phase of the reopening plan to move forward according to plan. Phuket will open to international tourists from July 1, 2021, and Surat Thani in the areas of Koh Samui, Koh Tao and Koh Phangan from July 15, 2021. With this clear reopening plan, the tourism sector – particularly hotels and accommodations that have been prepared and awarded the Safety and Health Administration Plus (SHA+) certificate – has begun to boost its marketing campaigns. Likewise, international airlines also reestablished direct flights to Phuket starting July 1, 2021. Meanwhile, travel demand from foreign visitors coming to Thailand is gradually rising.

        However, the plan to reopen the country to international tourists will serve as an important test for Thailand. If Phuket and Surat Thani can control their own outbreaks, the provinces will likely see growth of tourist arrivals in the forthcoming period, especially during the high season for foreign visitors in the fourth quarter of 2021, as several European airlines have plans to begin flights to Phuket. At the moment, these developments hinge on the cooperation of all parties concerned in monitoring and maintaining the standards of COVID-19 prevention measures stringently.

        KResearch views the Thai government's 120-day target of reopening the country to international tourists to be a feasible approach that will help to revive business activity in the tourism sector. Nevertheless, the success of this initiative rests on the conditions established by nationwide vaccination efforts and containment of COVID-19 outbreaks, both domestic and overseas, which are key conditions that affect the market direction of foreign tourists visiting Thailand in the second half of the year. KResearch has thus revised downward the upper end of its projection on the number of tourist arrivals in 2021 to 650,000, as influenced by the COVID-19 situation, while maintaining the lower end of our projection at 250,000 tourists. The ongoing outbreak and progress on vaccinations remain the most important factors to the success of Thailand's tourism reopening scheme over the remainder of 2021 and beyond.

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Econ Digest