Use the tourism fund ethically

Thailand is no stranger to superlatives. Some of them do not engender pride, such as being among the top three nations with the highest number of coups; but a few others, such as having the most visited capital city in the world, make everyone beam with pride. Yet the resumption of international tourism, which is kicking into higher gear with the reopening of China’s borders last week, is threatening to add a new label to Thailand’s list of distinctions — the biggest loser.

About a week before Beijing moved to scrap its Covid quarantine requirements for international in- and outbound travellers, the Tourism Authority of Thailand (TAT) revised its tourism estimates for this year.

It is now expecting around five million travellers from China to arrive until the end of the year, just 5% of whom (or around 300,000) will arrive in the first quarter of the year.

The figure isn’t as high as many people had expected, but it is nonetheless unsurprising because ticket prices remain prohibitive — only around 72,000 seats are available this month between Chinese and Thai cities.

What’s surprising is the figure which followed its revised arrivals estimation. Although it is now expecting five million additional tourists to visit by the end of the year, TAT did not revise its tourism revenue forecast for this year of 250 billion baht.

Odd, considering Chinese tourists are among the biggest spenders in the world, spending US$250 billion (8.2 trillion baht) in 2019 on travel alone and 531 billion baht from more than 10 million Chinese visitors in 2019.

There are many factors that could explain the decision to keep it unchanged, despite the fact they expect over 100% more visitors than the previous year. Among them could be rising fuel, global economic recession and labour costs.

However, the not so-ambitious revenue target also shows the government might not be able to meet its goal of attracting, in the words of Deputy Prime Minister Supattanapong Punmeechaow, “quality” tourists — in other words, tourists who spend more during their stay in the country.

A big part of the issue here is the persistence of “zero-dollar tourism”, cheap tour packages in which tourists are basically taken on shopping trips to buy commercially-produced goods, interspersed with the occasional stop at attractions — the proceeds from which do not reach the communities which bear the brunt of the impact of mass tourism.

Zero-dollar tourism has been estimated to cost the government around US$2 billion each year. So stamping out the practice has been made a priority by various governments, with no satisfactory outcome.

But the Prayut Chan-o-cha administration is faced with a unique mix of conditions such as higher ticket prices deterring high-spending independent tourists from visiting, and flourishing networks of Chinese investors (with Thai partnerships) that open hotels, entertainment, and restaurants to cater visitors from the mainland.

Thai inbound tourism has relied on tour companies in the zero-dollar tourism business to shoulder the cost of higher ticket prices and hotels as they can sell packaged tours to thousands of tourists.

The problem will continue to haunt the tourism industry as long as the country’s tourism infrastructure isn’t upgraded to encourage independent travel. Without tourist-friendly transport, honest and transparent tourism operators as well as reliable and affordable guides, zero-dollar tourism will never go away.

This time around, the government’s solution to fund the shortfall is by imposing a 300-baht fee on foreign visitors, which will go towards a fund that will be used to cover foreign travellers’ emergencies during their stay and develop tourist destinations.

While the fund’s goals deserve praise, the sheer potential size of the fund raises concern about possible abuses down the line, especially given the government’s track record in handling large endowments.

To ensure the fund isn’t abused or misused, the government needs to come up with a guideline which outlines what it can and can’t do with the fund.

It needs to be formulated through an inclusive process, which considers the perspective of all stakeholders, not just businesses represented by the Chambers of Commerce.

Considering how important tourism is to Thailand’s economy, it is imperative the tourism fund is transparently managed and periodically appraised. While the numbers are undoubtedly important, it is even more important that the fund is put into productive use. Instead of treating it as a rainy-day fund for tourism developments and emergencies only, the government must ensure the fund truly benefits the tourism sector.