Quake shakes tourist estimates

BANGKOK, 19 May 2014: Kasikorn Research Centre says the earthquake that struck Chiang Rai and North Thailand, 5 May, caused trip cancellations by both Thai and international tourists.
The centre estimated that domestic and international tourists visiting Chiang Mai in 2014 will reach 8.1 million, up 6.6% year-on-year to generate Bt68 billion in revenue, up 7.9% year-on-year, to travel-related businesses in the province.
However, revenue would be lower than the Bt71.5 billion projected before the earthquake, meaning that Chiang Mai may lose about Bt3.5 billion in tourism income, or about 4.9% of its total 2014 tourism income estimated before the earthquake. Of that total, 26% or around Bt900 million would have gone to local hotel and resort businesses.
The earthquake’s epicentre was located just 27 km southwest of Chiang Rai town and the province’s iconic Wat Rong Khun (White Temple sustained an estimated Bt150 million in damage.
Tourist targets suggest the province should attract 3.15 million visits (domestic and international) representing a 3.3% year-on-year increase. Revenue should reach Bt22 billion, up 4.8% year-on-year in tourism revenue to the province.
But post-earthquake reality suggests travel-related businesses will suffer a shortfall of about Bt1.1 billion in revenue, or about 4.8% of the expected total tourism income for 2014 (pre-earthquake assessment). Of that total, 24% or about Bt260 million, would have gone to local hotel and resort businesses.
Both Chiang Rai and Chiang Mai are expected to fully recover by October.
The bank suggested that Chiang Mai and Chiang Rai during the low season (May to September) would lose Bt4.6 billion, or about 4.9% of their total tourism revenue projected before the earthquake at around Bt94.6 billion.
It is expected that hotels and resorts in Chiang Mai and Chiang Rai will lose Bt1.16 billion in revenues. However, the loss could be lower than estimate if relevant agencies accelerate plans to restore tourism and tourist confidence before the upcoming high season that starts in October.
Cheap air fares, additional flights and Chiang Rai’s position as a gateway to both Myanmar and Laos should help to minimise losses.
However, there are also concerns that a crackdown on visa-runs that made Chiang Rai popular due to its close proximity to the Myanmar border at Mae Sai and the Lao border at Chiang Khong might reduce the tourist head count and reduce revenue earned by local companies offering visa-run services.
Kasikorn Research Centre is a subsidiary company of Kasikorn Bank, which conducts tourism and business research mainly on Thailand’s economy including tourism with reliable recommendations and indicators on business prospects.

Sourced: ttrweekly