Thai tourism should see a big recovery next year as airline capacity increases, while hotel operators are urging the government to bridge the income gap between large and small hotels, according to a forum held on Wednesday.
Speaking at the Bangkok Post Year-End Forum entitled "Thailand Insights 2023: Unlocking the Future", Thanet Phetsuwan, deputy governor of marketing for Asia and the South Pacific at the Tourism Authority of Thailand, said the country reopening without quarantine was the right decision as it helped pave the way for 10 million visitors this year.
Arrivals average 60,000 per day, mostly from short-haul markets such as Malaysia, which already hit 1.6 million visitors, as well as India, Laos, Cambodia and Singapore.
These markets will continue to be the main focus next year as the number of seats on Asia-Pacific routes has bounced back to 80% of pre-pandemic capacity and should return to nearly 100% next year, he said.
Seat capacity on long-haul routes is only at 30% of pre-pandemic levels in 2022.
However, the local tourism industry next year will be challenged by competition with global destinations as most big players have fully reopened, particularly Japan, which has attracted a lot of tourists including Thais this year, said Mr Thanet.
The key for boosting tourism is visa-free entry, as the most-visited destinations for Thai travellers are those that require no visa applications, he said, such as Japan, South Korea and Taiwan.
Meanwhile, the opening of new destinations like Saudi Arabia, which has an aggressive tourism plan, will be monitored next year as the country aims to lure more guests from Southeast Asia, said Mr Thanet.
Tourists from the Middle East may take more intra-regional trips, similar to the boom throughout Europe that happened during the pandemic, he said.
Mr Thanet said Thailand is projected to welcome 18 million foreign tourists next year.
However, he said the number could grow to 25 million if there are favourable factors, particularly the return of the Chinese market.
"We will use a mixed-market strategy next year," said Mr Thanet.
"It's time to restructure our tourism, not depending too much on a single market as in the past."
Speaking at the same event, Marisa Sukosol Nunbhakdi, president of the Thai Hotels Association, said the market next year would continue to grow after gaining momentum from Russian and East Asian tourists, who helped fill up rooms last month.
However, the industry still has to be cautious about potential headwinds and several challenges, especially manpower shortages and insufficient skilled labour, said Mrs Marisa.
In terms of demand, the market could be slower when the "revenge tourism" trend dies down next year, she said.
Five-star hotels are still outperforming those in the lower segments in terms of gross operation profits.
The performance of some luxury branded hotels has already exceeded pre-pandemic levels this year, said Mrs Marisa.
The situation is different for the mid-market to lower segments as they have struggled to increase room rates because of market constraints, she said.
These hotels' performance still lags their outcome in 2019, said Mrs Marisa.
She said competition in this segment is critical as they compete with unregulated rental homes via online platforms, while their main target market, the Chinese, are yet to return.
The government should work to coordinate with the private sector to remove obstacles, such as by amending the law to allow unregistered hotels to be eligible for registration, which could help to create fair competition, said Mrs Marisa.