Thailand Tourism Faces Global Challenges: Revenue Goals Threatened
The Thai tourism industry is bracing for a turbulent 2025, grappling with numerous challenges. These range from fluctuating oil prices and global economic anxieties to the unpredictable Chinese tourism market. These concerns are dominating discussions among airlines and hoteliers as they analyze post-peak-season trends, as reported by Narumon Kasemsuk in the February 20th Business section.
A key concern is the potential impact of former U. S. President Donald Trump’s trade policies on global oil prices. Fuel costs, a significant component of travel expenses, are under intense scrutiny. Tassapon Bijleveld, Executive Chairman of Asia Aviation (the majority shareholder of Thai AirAsia), highlighted the critical nature of fuel price volatility, especially given renewed trade tensions. Ironically, currently low fuel prices—driven by an expected oversupply attributed to Trump’s pro-fossil-fuel energy policies—are benefiting airlines. Bijleveld speculated that a resolution to the Russia-Ukraine conflict, as promised by the Russian president, could further increase global energy supply, benefiting not only the aviation sector but also other fossil-fuel-dependent industries.
While the International Air Transport Association reported robust 10.4% global air traffic growth in 2024, exceeding capacity growth, the domestic Thai market faces headwinds. Bijleveld expressed concern about the dampening effect of economic uncertainty and rising tariffs on consumer confidence and domestic purchasing power. He painted a somber picture of the overall economic landscape, citing the Thai stock market’s struggle to attract foreign investment due to low profitability and governance issues in some listed companies.
Further complicating matters is the unpredictable Chinese tourism market, crucial to Thailand’s tourism revenue. Thienprasit Chaiyapatranun, President of the Thai Hotels Association, highlighted how internet bookings and visa-free programs, particularly for Chinese tourists, have made forecasting increasingly difficult. Shortened booking lead times, a consequence of visa-free travel, force hotel operators to monitor the market weekly, rather than monthly. While the high season appears promising, the low season—absent festivals like Chinese New Year—will reveal underlying market trends. Chaiyapatranun emphasized the Chinese market’s pivotal role in achieving Thailand’s ambitious tourism revenue targets of 3 to 3.5 trillion baht. The sheer volume of Chinese tourism amplifies its impact, dwarfing potential gains from smaller, albeit growing, markets.
The performance of the Chinese market during April’s Songkran holiday is expected to provide clearer insights into the year’s trajectory, particularly after a lukewarm January. This follows a dent in tourism confidence caused by an incident involving a Chinese actor entangled in a scam network in Thailand. Chaiyapatranun noted that, despite initial concerns about the impact of the Chinese economy and Trump’s policies on Chinese outbound travel, the robust growth of Chinese tourism to Japan demonstrates continued spending power—a shift in destination preference rather than a decline in travel. Indeed, Japan experienced a remarkable surge in Chinese visitors in 2024, exceeding Thailand’s numbers. With attractions like World Expo 2025 in Osaka, and a weak yen bolstering its appeal, Japan is expected to continue attracting Chinese tourists.
The evolving landscape of Chinese tourism preferences, with travelers exploring new destinations in Southeast Asia and Japan, poses a significant challenge for Thailand. Data from Chinese travel agency Tongcheng Travel reveals a surge in outbound travel during the Chinese New Year, with Japan, Malaysia, Singapore, South Korea, and Thailand among the popular destinations. The rising popularity of emerging destinations underscores the need for Thailand to proactively adapt and innovate to recapture a larger share of this crucial market. The competition is fierce, and Thailand’s tourism industry faces a crucial moment, demanding strategic planning and adaptation to navigate these complex global currents.
