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Travel industry wary as Thai army declares martial law

May 21, 2014 Destination Thailand, Headline News No Comments Email Email

egtmedia59Thailand’s army has taken a step that many observers had predicted – it has declared martial law.

The army, which acted yesterday after six months of violent unrest and anti-government demonstrations, made clear that its move was “to keep law and order” and insisted it was not a military coup. An army spokesman said that the imposition of martial law would have no impact on Thailand’s caretaker government, which remains in office. The military move ends the stalemate which prevailed after the country’s caretaker prime minister refused to depart earlier this week.

Tourists in Bangkok and elsewhere in the country are unlikely to be affected by martial law, at least in the short term.  All seems peaceful so far, with Thai residents taking selfies with soldiers and going about their daily lives without problem.

Tourism leaders can be expected to quietly welcome anything that restores stability to the country and stops the waves of street protests in Bangkok. All will depend on what happens in coming weeks.

The airline industry, in particular, will be hoping for a period of calm. Last Saturday, The Economist carried a little good news about the Thai situation, in the following passage: Night Owl - Article Banner

Despite the gloom, part of the market still looks promising. Two of the carriers expected to take off this year, NokScoot and AirAsiaX, both joint ventures based in Thailand, will be offering medium- to long-haul flights (ie, lasting more than four hours). Although the short-haul market is saturated, this business still has plenty of room to grow.” 

Anything that might affect the market will concern the airlines.

As it is, Thai Airways International suffered losses in the first quarter of this year and expects to be in the red possibly for the next four months, the Bangkok Post reported. The net loss in the January-March period was put at THB 2.6 billion (AUD 86.3 million). It was a reversal of fortune from the same period last year when the airline made a THB 8.29 billion (AUD 272.1 million) profit. But the airline still suffered losses of about THB 13 billion (AUD 431.4 million) last year.

News of the army move came just after the Tourism Authority of Thailand (TAT) prepared to launch a range of tactical campaigns and special tourism activities for the Europe and Middle East markets “to retain tourists’ confidence and ensure the growth of the country’s tourism industry, as part of the plans to combat recent challenges and setbacks”, as TAT put it.

TAT Governor Thawatchai Arunyik said the overall European market was holding up this year in the face of “several volatile factors including the ongoing domestic political situation”. The Middle East market, in contrast, had stagnated.

According to statistics from Thailand’s Ministry of Tourism and Sports, the number of visitors from Europe to Thailand in the four months from January to April 2014 grew by 7.63% to reach 2.7 million. During the same period, Russia contributed the highest number, totalling 823,233 visitors (12.32% increase), followed by Britain at 341,448 travellers (5.75% growth).

Earlier this month, a court ordered Prime Minister Yingluck Shinawatra and several cabinet ministers to step down.

While the military move had been predicted as an option, it came as a surprise when announced on the military’s television channel.

The Guardian noted yesterday that Thailand’s army has staged 11 successful coups since the end of absolute monarchy in 1932. Yesterday’s sudden announcement isn’t one of them, officers insisted yesterday.

Protests have pitted largely rural supporters of populist former Prime Minister Thaksin Shinawatra and his sister Yingluck against Thailand’s traditional elites. Thaksin opponents want the Thaksin dynasty barred from power, for corruption. They fear that if elections go ahead otherwise, the Thaksin clique, with popular rural support, will win.

Three people were killed in a grenade and gunfire assault on anti-government demonstrators in Bangkok last Wednesday. Sporadic violence and outbursts of protest have had a dampening effect on tourism and hotel occupancies in Thailand, one of the world’s top tourist destinations.

Overall, Thailand’s economy shrank more than expected in the first quarter of this year, prompting fears of recession.

Meanwhile, about 250 hotel investors, owners, developers and master planners from 26 countries are meeting at the Dusit Thani Hotel in Bangkok at the moment for the Thailand Hotel Investment Conference. The conference began on Monday and wraps up today. Current events should give delegates plenty to talk about.

Written by : Peter Needham

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