Not since the 1991 Gulf War has the regional travel & tourism industry experienced such a dramatic boom-to-bust scenario.

Total arrivals to Thailand in 1997-2002

The first six months of 2003 will go down in history as the period when the twin crises of SARS and the Iraq war struck simultaneously, keeping millions of travellers at home and leaving the industry stunned and shaken.
Now, with Asia-Pacific destinations all scrambling to recover their respective industries and bring back visitors, Thai tourism is facing huge competition to ensure that it retains market share and retains its appeal as a quality, fresh and value-for-money destination.

The crises had a severe impact on Thailand. Arrivals declined significantly, especially in March (-12%) and in April (-40%).
Visitor arrivals at Bangkok International Airport during January-May 2003 saw a total decline of 18.17% to 2,612,134. Arrivals from the Middle East showed the biggest decline of 33.51% to 50,062, while visitors from Europe showed the lowest decline of 9.30% to 786,229.

Arrivals from East Asian source markets, like China, Taiwan and Singapore, were severely affected. Although arrivals from South Asia fell by 11.32%, visitors from Bangladesh showed a surprisingly high growth of 42.86% to 16,860 during the same period.

Thai outbound travel to Asian countries also fell, affecting the yields of airlines operating to Thailand and the profitability of the overall route. The normal school holiday period of April-May proved to be very bad for Thai outbound travel agents. There was some corresponding growth in domestic travel but not enough to compensate for the overall fall in foreign visitors.

The sharp declines have led the Tourism Authority of Thailand (TAT) to lower its 2003 visitor arrival forecasts to 9.31 million, or 13.7% less than in 2002. Attempts are being made to compensate by shoring up domestic tourism to generate 65 million trips, or a growth of 5.64% over 2002.

In an effort to bring back as much business as possible, as soon as possible, TAT has mounted recovery campaigns. The Thai government has approved funding of 500 million baht for short and medium-term campaigns to be launched in different markets.

The campaigns are designed to stimulate a desire to travel as well as convert that desire into choosing Thailand as the destination. (More details are in the section on TAT).

The crises have thrust the entire industry into an entirely new paradigm, emphasising the need for strong crisis management plans, rapid response mechanisms and effective cooperation and collaboration between the public and private sectors.
All through the crises, there were close consultations between TAT, the Association of Thai Travel Agents (ATTA), the Thai Hotels Association (THA) and other industry associations, Thai Airways International, plus the various privately-owned airlines.

A case in point was the response of the Thai government in offering US$100,000 to any tourists who could prove that they were infected with SARS while in Thailand. This unique scheme was not matched by any other destination in the region.
Small and Medium-sized Enterprises (SMEs), the worst affected industry segment, were given special low interest loans via the SME Development Bank of Thailand and the Industrial Finance Corporation of Thailand (IFCT).

As it became apparent that a potentially global crisis required global responses, Thailand hosted a number of high-level, multilateral meetings, at which the crises were analysed and addressed from several different perspectives.

Heads of state of the Association of Southeast Asian Nations met in Bangkok on 29 April 2003 for an emergency summit on SARS, playing a major role in facilitating the quick decisions that were necessary to curb the spread of the disease.
The Asian Cooperation Dialogue convened a Tourism Business Forum in Phuket between 24-25 May 2003. Business executives and government officials from 12 Asian countries attended the forum and called on governments to be cautious when issuing travel advisories to prevent misconceptions regarding contagious diseases and terrorist threats.

The 22nd Tourism Working Group (TWG) of the Asia Pacific Economic Co-operation (APEC) met on 10-11 June in Pattaya, after their meeting was postponed in April due to the SARS outbreak.

TWG agreed to undertake a research and analysis project on how governments and tourism operators can best manage risk and respond to such crises as the Bali terrorist bombing and SARS. The study is to be completed by the end of September 2003.

APEC Health Ministers held their first-ever meeting in Bangkok on 28 June 2003 and highlighted the importance of developing future defences against economically damaging, cross-border epidemics.

The Ministers issued the “APEC Health Ministers’ Statement” and the set of “Guiding Principles for Health Screening and Management for International Travellers”, both of which have been posted on the APEC Secretariat’s website: www.apecsec.org.sg.

The Bangkok-based travel industry organisation, the Pacific Asia Travel Association (PATA), also launched Operation Phoenix, a multicountry programme designed to restore public confidence in travelling and going ahead with previously postponed leisure or business trips.

Overall, there was acute realisation across the board that the twin crises of conflict and disease invariably make travel and tourism their first victims.

While countries can respond individually to protect their local industries and international market share, they also have to work together to address the underlying issues.

Thailand clearly addressed all these issues to the best possible extent. Now, the industry is waiting to see if the efforts will reap the required results.

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