Thailand Showing Strong Signs of Travel Recovery


Despite the devastating floods of June, Thailand is showing strong signs of travel recovery. Domestic seat capacity has reached 89% of its pre-pandemic levels, compared with 59% for international flights. The Russian invasion of Ukraine has exacerbated the travel restrictions even further.

Booster Shot project

Thailand’s policy response to the COVID-19 pandemic has aimed to boost economic activity and support the livelihoods of the poorest members of society. The strategy revolves around a 1.5 trillion baht off-budget fiscal package, which represents 9% of the country’s GDP. This amount will go toward large-scale cash transfer programs to help vulnerable groups who are not covered by existing social assistance programs.

Domestic seat capacity reaches 89% of pre-pandemic levels

Despite the recent increase in airline seat capacity, the lack of flights to Thailand remains one of the biggest barriers to tourism recovery. Most European flag carriers have not yet resumed services to Thailand. Last week, the Tourism Authority of Thailand met with the Civil Aviation Authority of Thailand to discuss the situation. The authorities told them that the country is likely to secure thirty-nine percent of pre-pandemic international seat capacity by the upcoming high season. However, these seats will be largely from long-haul destinations, so there is limited choice of direct flights.

The government is pursuing measures to increase flight capacity and reduce flight cancellations. This could include enacting new laws and introducing incentives to airlines to increase their services to Thailand.

International capacity is just 59%

The International Monetary Fund (IMF) is assessing the country’s economic reform agenda. Thailand has not met its quota for the past five years. However, the country is making strides to improve its capacity. The IMF Capacity Development Office in Thailand is holding its sixth advisory committee meeting. Members of the committee include representatives of Cambodia, Myanmar, Vietnam, and Lao P.D.R. The meeting was held via videoconference with representatives of the countries.

Virus travel restrictions exacerbated by Russian invasion of Ukraine

Russia’s invasion of Ukraine has severely affected tourism in Thailand. As a result, thousands of Russians have been trapped in the country, unable to pay their bills or return home. The situation has also severely hurt the economy, which relies heavily on Russian visitors. According to the National Economic and Social Development Council, tourism in Thailand contributed 11% of its GDP last year. Approximately 20% of Thais are employed in the tourism industry. Although the number of visitors from Russia has declined, tourism in Thailand has rebounded in the fourth quarter of 2021, as a result of the increased number of tourists.

The travel bans are part of a downward spiral in Russia’s relations with the West. After the Russian invasion of Ukraine on February 24, the United States and other Western nations imposed sanctions on Moscow. In response, the Ukrainian government increased its arms supplies to Russia. President Biden, however, has pledged to help Ukraine in the refugee crisis.

Booster Shot project aims to welcome Chinese tourists

Thailand has rolled out its second booster shot project in cooperation with Pfizer and AstraZeneca. The aim is to welcome more Chinese tourists to the country. The project has already helped Chinese tourists get cheaper flights to Thailand, and the government hopes to increase the number of tourists to 10 million by 2022.

Operating environment remains turbulent

The operating environment in Thailand remains tumultuous despite a stable government and stable economy. The government is steadfast in its commitment to fundamental policy principles, including friendly relations with all neighbors, a free-market economy, and openness to foreign investors and tourists. It has implemented sound macroeconomic policies, enhanced infrastructure, and introduced reforms to enhance the country’s competitiveness. Its policies have been supported by a vibrant private sector and a strong civil service that oversees the implementation of laws and regulations.

Political groups are treated inconsistently in Thailand. If they are considered a threat to the government, they are often suppressed. During the period 2014-2019, the junta imposed the Emergency Decree and Martial Law Act, both of which muzzled political activity. Despite these measures, the country’s political space has widened a little following the 2019 elections. Nonetheless, the government still denies the right to association for individuals convicted of crimes such as lese-majeste.