Dollars, not euros for travel packages
Greek crisis imperils European currency
Small and medium-sized tour operators are being urged to sell their packages in US dollars instead of euros, as the European currency is expected to fall further amid the Greek loan default.
Mingkwan Metmowlee, president of the Association of Thai Tourism Marketing (ATTM), said the switch to dollars would lower these companies’ currency exchange risks.
Big tour operators have already prepared themselves to deal with the Greek crisis, but many smaller operators have yet to do so, she said.
After Greece defaulted on its loan payment to the International Monetary Fund, the likelihood of the country pulling out of the euro zone is high. There are fears that other nations in the bloc could follow suit.
Yesterday, the baht was 37.50 to the euro but only 33.81 to the dollar. Ms Mingkwan said European clients and friends had told her they were prepared for the continuing fall of the euro.
“Many people expect the euro will slide further to nearly 33 or even 34 baht, not far from the US dollar-baht exchange, this year or early next,” she said.
On Monday, the euro had weakened to 37.60 baht, a 16.4% decline from January 2014, when it stood at 45 baht.
If the currency continues to fall and its exchange rate does match the dollar’s, that would mean the cost of travelling to Thailand for European tourists would increase by more than 24% from January 2014, the ATTM said.
The Tourism Authority of Thailand (TAT) is also concerned about Greece’s economic woes and predicts Thai tourism will take a hit if the euro ends up weakening more than 20% against the baht.
The TAT will try to mitigate a fall in European tourist numbers by relaunching its old “Value for Money” campaign, said Tanes Petsuwan, executive director for Europe, Africa and the Middle East.
That campaign was aimed at changing the image of Thailand from a cheap destination to a value-for-money country.
Mr Tanes said the TAT must work closely with travel agents so that Asian tourists could help to compensate for the loss of the European market.
The ATTM agrees with the TAT, projecting high-end European tourists will still prefer the Caribbean, Mexico and South Africa, while the middle class will select Asian countries.
Ms Mingkwan said as the centre of Asean, Thailand still had the potential to welcome European tourists but with the average length of stay shortened to 10-15 days from 14-21 days.