Thailand losing tourism, investment dollars amid political turmoil
- POSTED: 17 Jan 2014 00:46
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The economic cost of the ongoing political deadlock in Bangkok remains hard to quantify. But what is clear is that Thailand is fast losing tourist dollars, and that the prolonged political turmoil is having a far reaching impact on the wider region.
MALAYSIA: The economic cost of the ongoing political deadlock in Bangkok remains hard to quantify.
But what is clear is that Thailand is fast losing tourist dollars, and that the prolonged political turmoil is having a far reaching impact on the wider region.
January is traditionally a peak season for tourists in Malaysia and it usually stretches on to the Lunar New Year period.
But the ongoing protests and uncertainty in Bangkok have affected tourist arrivals.
Group tour packages from major markets like the US, Europe and Asia and Pacific usually include Thailand, Malaysia and Singapore.
Many programme itineraries cannot be changed without incurring costs - and as a result some travel agencies are experiencing last-minute cancellations.
While Visit Malaysia Year 2014 may be off to a slow start, the tourism board is unfazed by the fallout from Thailand's political turmoil, which has apparently dampened Thais' mood for travel.
It is stepping up promotional campaigns with attractive offers, including free upgrades in a bid to curb the decreasing number of Thai visitors.
Nazri Aziz, Malaysia’s tourism minister, said: "Thais are not touring. Because if they come, they come from Bangkok. When they come from Bangkok, they come by land. They go to southern Thailand. Southern Thailand is in turmoil and now the situation is worse with Bangkok now in turmoil. So, the number (of tourist arrivals) from Thailand has gone down."
Tourism is not the only sector Thailand needs to worry about, Bangkok also risks losing out on foreign direct investment if the deadlock continues.
Known as Detroit of the East, Thailand is the seventh largest car manufacturer in the world, churning out almost 2.5 million units a year.
But it is losing speed, with its ASEAN neighbours revving up competition.
Like Indonesia, Malaysia too is actively wooing foreign car manufacturers to shift their production there.
The government is unveiling a national automotive policy on Monday, finally opening up its long-protected auto industry by rolling out attractive tax incentives, including offering soft loans to foreign carmakers.
Madani Sahari, CEO of Malaysia Automotive Institute, said: "This is all about business, spreading the business risks, not to put all the eggs in one basket. Some are deciding even going into other ASEAN countries, some into Malaysia. We have enough platform now to receive whoever who wants to divest into Malaysia."
Already, Honda and Mazda have set up facilities in Malaysia, and other car companies may be following suit, further compounding the risk Thailand will continue to lose out further to its ASEAN neighbours.