Thailand suffered a rare combined drop in tourist arrivals and spending in March, signalling a rocky first quarter for the sluggish economy.
The number of visitors fell 0.7% from a year ago to 3.5 million, official figures out Friday and data compiled by Bloomberg show. Foreign tourism receipts slid 1.3% to 184.5 billion baht.
Visitors from China, Thailand's biggest source of tourists, dropped 1.87% in March from a year earlier after slumping 12.29% in February.
Tourism is critical for the economy and on some measures accounts for a fifth of the economy, prompting the government to take steps such as waiving visa fees to woo travellers. The downbeat report follows data earlier this week showing a worse-than-expected tumble in exports, another economic engine.
"If the tourism arrivals and receipts continue to slide, it could be an added risk to the economy because the sector is one of the main drivers," said Duangrat Prajaksilpthai, an economist at TMB Bank. "The numbers usually fluctuate and could bounce back so we have to wait and see.'
Political gridlock following a messy general election in March, the first since a coup in 2014, is also weighing on sentiment.
Last week, Finance Minister Apisak Tantivorawong said economic growth may slow to the low 3% range in the first and second quarters, and that officials are mulling steps to inject 20 billion baht of stimulus.
Chinese holidaymakers have driven a years-long boom but arrival numbers have declined for two straight months. The figures also showed a substantial 35% jump in visitors from India.
At the turn of the year, Thailand expected to hit a record for tourist arrivals this year of about 40 million.