On boosting the tourism sector through the development of the luxury marketWhat are the main strategies for growth in the luxury tourism segment?
PRUET: If you look at the total market size, Thailand recorded an increase in tourism arrivals of over 6% between 2016 and 2017, reaching around 33-34m visitors. Internationally, however, the top markets in terms of spending are in the Middle East and East Asia; led by visitors from Saudi Arabia, UAE, ASEAN and China.
Government strategies in 2018 will continue to work to position Thailand as a preferred destination for the affluent market in East Asia and ASEAN. The 2018 tourism action plan is designed to maintain a strong flow of visitors to a high-quality environment. Many businesses are starting to see the result of the government’s market restructuring efforts, leading to a peak in higher income and first-time visitors.
While other regional neighbours have competitive tourism markets, they do not have as many outdoor adventure opportunities. Thailand’s tourism products remain popular all over the world, and will continue to offer enticing activities and attractions. In order to develop this further, we have to work together to upgrade our products and services to differentiate us from other neighbouring luxury markets. This should position Thailand as a true luxury destination by shifting from mass to niche markets.
How can the country attract more foreign direct investment and local investment to enhance Thailand as a prime destination?
PRUET: Under its tourism programme the country has been strategising ways to attract a larger amount of affluent tourists. There are plenty of opportunities in Thailand, but soft infrastructure has compromised growth. While business conditions in Western tourism sectors are based on a free market, the market in Thailand is still shaped by the local mindset, which dictates that tourism activity belongs to local rather than foreign companies.
Additionally, the service sector would benefit from faster decision-making on policies and greater partnership from the government. For Thailand’s tourism sector to compete with the rest of the world, public-private partnerships are key. Over the years we have seen that tourism sectors in other countries benefit from improved investment programmes, but Thailand has yet to receive similar governmental support. Hopefully, our country will come to understand that allowing foreign entities to enter the services sector will not diminish the local market.
Thailand is still a controlled market, and this needs to change or we will lose to neighbouring markets that have better coordinated their investment bodies, tourism authorities, and foreign and local private businesses. For example, Singapore observed that increasing the amount of leisure tourism would result in higher numbers in the luxury segment, so the country changed its legislations to allow different kind of entertainment centres such as the Marina Bay Sands.
What aspects of hard infrastructure in traditional tourism should be improved to attract a greater share of the luxury market?
PRUET: Thailand is only starting to understand that nature tourism offerings are not enough to compete with our neighbours. We also need to promote more of our man-made heritage, in order to be able to compete with the Great Wall of China and the temples of Vietnam. Thailand has a lot of potential in this area, but many of our historical sites are not as famous as they could be because there are currently no organisations promoting them.
On the connectivity side of infrastructure, mobility is low and many tourists do not feel comfortable driving around the country. Traffic signs, for example, do not display foreign languages as they do in Malaysia or Vietnam. It will be difficult to move forward if we ignore international standards in our development programmes. Again, the mindset and regulatory systems in Thailand have impeded the tourism sector’s ability to grow. If Thailand waits too long to improve its infrastructure we will lose our budding affluent market to places like the Maldives or Bali, where facilities and accessibility are better aligned with international norms.
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