Thailand’s Chinese tourism arrivals have taken a hit in the wake of the Phoenix boat accident in July, which left 47 Chinese tourists dead. Still, it appears that the drop was not as severe as some expected. Estimates for the drop in potential lost revenue for the rest of the year are around $1 billion. The total drop in arrivals is estimated to be as high as 670,000. According to statistics from the Thai Ministry of Tourism and Sports, Chinese tourist arrivals to Thailand did fall in July, but overall spending was up.
The overall drop in Chinese arrivals is likely higher than recent figures imply given that Thailand has been enjoying double digit Chinese arrival growth this year
Chinese arrivals to Thailand were down by 0.87 percent in July compared to July last year, falling to a total of 929.771. At face value, this isn’t an enormous drop. However, given that Chinese tourists spent on average 51,800 baht (around $1,580 at the current exchange rate) per trip for the first seven months of 2017, the .87 percent drop in July, representing a decline of 8,132 tourists, could represent around $12,848,560 in lost tourist revenue. Of course, it’s impossible to know how much the tourists that canceled their plans to travel to Thailand would have spent, and they could very well have been lower-than-average spenders.
However, when considering that May and June saw growth in arrivals of 18.12 percent and 14.05 percent respectively, the effective drop in Chinese arrivals to Thailand may be much higher than the 0.87 percent drop in July implies.
There were some calls to eliminate visa fees for Chinese tourists to help lessen the blow of lost tourists revenue following the accident. However, Thai officials have stated that they will not be pursuing any visa-free reductions or eliminations to attract more Chinese tourists.
Despite the 0.87 percent drop in Chinese arrivals, Chinese tourist spending rose by 4.47 percent in July
The good news is that overall Chinese tourism revenue was actually up substantially. Chinese tourists spent around 51.38 billion baht (approximately $1.56 billion) in July, up 4.47 percent from July 2017’s 49.18 billion baht ($1.50 billion) in Chinese tourist spending. Of course, this figure could have been much higher given how rapid Chinese tourism growth to Thailand was in May and June.
Regardless, the drop in Chinese tourism to Thailand was a lot more subdued than the initial wave of tour and hotel booking cancellations implied. Thai tourism officials credit the relatively small decline in arrivals to “winning back” some Chinese tourists after making commitments to improve safety standards and enforcement. If the trend holds in August and beyond remains to be seen.