| Thailand Tourism
Still Favorable
 Investors and international hotel operators remain positive about the long-term prospects for the Thai tourism market, despite weaker performance with only an 2.3% increase in total tourist arrivals in the first eight months of 2007, according to CB Richard Ellis Thailand. The number of tourist arrivals increased to 9.59 million in the first eight months, from 9.37 million during the same period in 2006. For the first half of 2007, Middle East arrivals rose by 20%, Europeans 14.3%, South Asians 10.5% while East Asians declined by 3.9%. Thailand has been successful in attracting visitors from several newer markets, including 139,000 Russians with a 51% increase year-on-year and 265,000 Indians, or a rise of 14% year-on-year. There were weaknesses in other markets with a 12% drop in visitors from Malaysia, a 7% decline from Japan, and an 18% fall from China. China is one of Asia’s fastest growing markets with 37 million Chinese expected to travel overseas this year but Thailand attracted only about 2% of them in the first half of 2007. Hotels Update Bangkok expects that overall occupancy rates for its four and five star hotels will only be 70% in 2007 compared to 75% in 2006. The reasons for lower occupancy rates are political uncertainty and security concerns arising from a weak economy. The average room rate is likely to reach US$170 per night at the end of 2007, compared to $158 last year. Some hotel operators plan to change contract rates from dollars into baht because of the currency’s weakness. Room rates have increased about 2% in baht terms but more than 10% in dollar terms. A typical hotel in the luxury (five to six star) category would have an average daily room rate (ADR) of at least 5,500 baht a night, while ADRs of first-class (four-star) hotels range from 4,500 to 5,500 baht. Experts have projected that more than 2,000 new four- and five-star hotel rooms would be completed in Bangkok in 2008, raising the supply by 24% from 2007. The number of hotels is expected to increase throughout 2008 as more serviced apartment operators also will be looking to attract daily guests. International hotel operators want to establish their brands in Thailand not only in Bangkok but also in resort locations such as Phuket, Krabi, Phangnga and Samui. Starwood has announced that it will operate a St Regis hotel in Bangkok and W hotels in both the capital and resort destination of Koh Samui. Two Popular Destinations In the South - Phuket Phuket’s tourism industry continues to grow from strength to strength. The Phuket International Airport’s first-quarter arrivals in 2007 were 10% higher than in 2006, and by May the number had reached 2.5 million with more than 25 international airlines offering direct flights on both a chartered and scheduled basis. Arrivals are expected to hit 4.7 million visitors by 2007’s end, matching the record set in 2004, which was hailed as the island’s ‘‘Golden Year’’, prior to the tsunami. In the North - Chiang Mai In 2006, five million people visited Chiang Mai, generating 46 billion baht of revenue. The visitors included two million foreign visitors and three million Thais. The Chiang Mai Tourism Business Association expects two million foreign visitors this year but 10-15% fewer Thai visitors. The association projects 5-10% growth in visitors in 2008, and 3 billion baht more in revenue, from 46 billion in 2007. Hospitality industry still growing strong Thailand’s hospitality sector was attracting a variety of investors. The Bangkok Post newspaper reported Thailand’s hospitality industry drew about 15 billion baht of new investment through 2007. Institutional investors are focused on the hotel and leisure industry and the commercial sector or corporate investors like the residential segment. Deals can be as 100%-owned firms, joint ventures or acquisitions of listed companies. Most foreign investors are from the Middle East, Europe, China, Hong Kong, Malaysia, Singapore and Australia. Thailand sets its sights on becoming the medical hub of Asia The Thailand Board of Investment reported:
The concept of health tourism is new, but with skyrocketing healthcare costs in many countries and overworked medical infrastructures, the market certainly is ripe for high quality lower cost treatment. And, as health care facilities in Thailand expand and with current infrastructure investments to maintain international standards and cutting edge treatments, the medical device sector and pharmaceutical sector are experiencing a similar increased demand. The Thai government has formally approved a strategic plan to develop Thailand as a “Center of Excellent Health of Asia”, focusing on medical services, healthcare services, and Thai herbal products. Excellent Investment Environment Thailand offers the perfect climate for investment in healthcare, medical devices and pharmacy. With GDP rising at an average of 5 percent per year since 2001, Thailand’s status as a destination for medical “outsourcing” is being driven by the quality, cost, and care offered, as increasing costs and decreasing coverage of foreign health care systems provide added impetus for growth. In 2006 the value of the OECD nations’ health care sector was estimated at US$ 3 trillion and the American sector at US$ 2 trillion, with up to 40 million Americans uninsured. Increasingly, even insured Americans are being given the option of having medical surgeries performed overseas and keeping part of the savings for themselves. The average foreign patient in Thailand spends about US$ 358 (13,600 baht) per day, or about three times the average of a leisure tourist. Thai health care and wellness providers also have a huge opportunity to grow the industry at home, while providing savings and service to foreign customers. Thailand’s healthcare industry was an early adopter of ISO 9000 certification to signal to patients that hospitals were focused on quality of care. In the mid-1990s, Thailand became the first country in Southeast Asia to have its own hospital accreditation system. More recently hospitals in Thailand have opted to also apply for Joint Commission International (JCI) accreditation which is the international accreditation arm of the U.S. Joint Commission on Accreditation of Healthcare Organizations (JCAHO). Bumrungrad International was the first Thai hospital to receive JCI accreditation and the first in Asia. More of our useful articles: |
