Island tourism slumps

15 Sep 2014  2037 | World Travel News

PHUKET A mid-year slump in arrivals to Phuket and Samui islands has jolted hotel confidence, according to a half year report released, today, by leading hospitality consulting firm C9 Hotelworks.
The respected market research states that in the aftermath of Thailand’s political crisis, which saw martial law and a nationwide curfew imposed in May, Phuket experienced a sharp drop in visitor arrivals.
The worst was in June when combined international and domestic passenger arrivals dopped 14% year-on-year.

Bill Barnett
C9 Hotelworks managing director, Bill Barnett, said there had been a gradual easing of the negative trend in July and August, though compared to the same period in 2013 the market has continued to experience contraction.
Chinese and Russian travellers remained key sources of business in the first half of 2104, accounting for 41% of international arrivals, rising 6% and 14% year-on-year, respectively.
During the first half year, room night demand retracted to 72% and room rates decelerated, levelling off at USD159 compared to the same period in 2013.
Passenger arrivals at Phuket International Airport in the first half of 2014 maintained a positive 10-year CAGR growth of 13% between 2004 to 2014 and five-year growth of 8%.
“Phuket is expected to benefit however from an extensive government-led ocean front clean-up of illegal structures and an anti-corruption campaign which has resulted in a remarkable clearing of the island’s beaches,” Mr Barnett observed.
However there are mounting concerns about over-leveraging of emerging mass tourism segments with potential risk from the Ukraine political crisis and rise of global oil prices which will impact price-sensitive tour business.”
On Samui Island, market-wide hotel occupancy for January through June achieved 70% with an average rate of USD162. One decided change for Samui has been the growing influence of the Russian market,which now tops the international arrivals list with a share12.3% of visitors.
On the infrastructure front, after the opening of the Central Festival retail complex, a new 4,000 square meter community mall developed by the Platinum Group is scheduled to open in December. Direct foreign investment in the island’s hospitality sector is moving forward, highlighted by Malaysia’s YTL conglomerate.
C9′s forecast for both markets based on feedback from hoteliers suggests static growth for the full year as demand is expected to return H2, while in 2015 they are looking at budgeting similar figures which they had previously anticipated when preparing growth-oriented 2014 budgets.
That said, Bill Barnett was quick to say “there continues to be a clear and present danger about an over-reliance in Thailand’s resort markets of mono segmentation; playing to a one-trick pony is never a sustainable long term strategy.”

sourced:ttrweekly.com 

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