The extremely high Thai Baht -which is hovering around THB30.5 to one US dollar is causing concerns to the tourism industry. It seems that even TAT Governor Yuthasak Suphasorn feels concerned about the potential negative impact of the strong currency.
TAT (Tourism Authority of Thailand) chief Yuthasak Suphasorn is blaming the high value of the Thai baht for the worse than expected tourist figures. He admits that European visitors are being more careful over their money and that Thai tourism tzars will now have to look to places like India to sustain growth.
The Governor of the Tourism Authority of Thailand, Yuthasak Supasorn, recently talked to Thailand based ‘Daily News’ about a slowing down in growth rates of tourist arrivals to the Kingdom. Many factors could currently contribute to the less favourable performance. There is still a lingering effect of the Phuket boat accident-which occured a year ago- on China tourist arrivals, a rise in air fares due to the rise of kerosene but also the very strong Baht. The latter is causing real concern to TAT and this is one of the first time that the tourism marketing agency blames the currency on the country’s tourism mediocre performance.
Between January and May of 2019, total arrivals grew by only 1.9 percent reaching 11.15 million tourist arrivals. Chinese figures were down by 4.3%, an acceleration of the slump as numbers were only down by 1.7% at the end of the first quarter. Europe is down by 2.1% with a worrying negative trend in traditional countries such as Germany (-4.3%), Sweden (-10.7%) and Russia (-2.8%). Tourism from the Middle East collapsed with a decrease of 10.3% while the Americas progressed moderately by 1.15%. However, tourist arrivals from ASEAN remained strong with a plus of 6.4% thanks to double-digit growth from the Philippines, Indonesia and Malaysia. India is also performing extremely well, up by 23.4% during the first five months of the year. Spending from tourists grew moderately at 1.8%, tourists trying to save money due the strong Baht.
Talking to the publication, TAT governor indicated that a negative impact has been the rise in packages from overseas tour companies to follow the rise of the Thai Baht. The currency has been going from strength to strength for now seven months. On July 1, 2018, the US dollar was equivalent to THB 33.16. Yesterday, it was quoted at THB30.67. Same story for the Euro which has seen its value in Thai baht dropping from THB38.60 to THB34.62 yesterday. This represents a de facto decline in value of 8.1% for the US dollar in a year and of 11.5% for the Euro.
They have been concerned express from industry circles in recent days and it might be possible that the value of the Thai Baht decreases in some ways to be back to a more sustainable level as exports are also suffering.
Despite the current issues, Yuthasak Suphasorn remains positive about Thailand tourism outlook. The Kingdom still expects to pass for the first time the 40-million international arrivals’ mark while predicting that the tourism and travel industry would generate THB 3,400 billion.