Former tourism minister urges debt relief for struggling operators
published : 28 Aug 2020 at 04:44
newspaper section: Business
writer: Dusida Worrachaddejchai
Financial institutions should help the beleaguered tourism industry by alleviating operators' debt service burden for three years and encouraging businesses to maximise capability for a future revival, says a former tourism and sports minister.
"If we believe Thai tourism still has a future, such a policy is essential," said senator Weerasak Kowsurat. "We hope that once the crisis subsides, we will have a firm industry awaiting a new wave of arrivals."
He said a problem occurs when banks have to implement strict financial discipline and avoid non-performing loans to preserve liquidity, while the vast majority of tourism operators lack reliable credit or assets as collateral.
To offer this type of loan, banks don't have to reduce interest rates, he said. Instead they can provide a debt holiday -- delaying both principal and interest repayment -- for three years, which is the amount of time the global economy is likely to take to recover from the coronavirus pandemic.
After receiving soft loans, borrowers must commit to certain conditions that lead to individual business restructuring and whole industry development, such as avoiding lay-offs.
"With sufficient cash and less debt burden, operators can focus on adjusting business strategies aligned with global trends," Mr Weerasak said.
He said those with assets, such as hotels, must submit a development plan to raise venture capital. They can add more value to the property to cater to potential markets, such as health and wellness components and universal design.
Those without assets must reskill and upskill staff via language and digital classes, or come up with proposals for new tourism routes or community tourism.
Speaking at a seminar on "New Normal Tourism: Opportunities and Challenges" hosted by the Senate Standing Committee on Tourism, Mr Weerasak said Thailand pre-pandemic was focused on second-tier provinces, but now the government should make a U-turn to support major destinations because they rely on tourism revenue more than other destinations do.
The government can allocate budget for meetings and incentives in both major provinces and second-tier destinations, he said.
Songtam Suksawang, a forestry technical officer at the National Park, Wildlife and Plant Conservation Department, said national parks must emphasise health by limiting carrying capacity. This would mean tourists preregistering for trips to national parks on the QueQ app.
But there remains a problem with no-show tourists, so the department will introduce a new tourism app that features a payment method, he said.