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18 Feb 2015

Tourism

Chinese New Year: Bolstering Chinese Tourist Arrivals to Grow 30.2% in 1Q15 (Current Issue No. 2593 Full Ed.)

The Chinese New Year, which falls on February 19 this year, is one of the most important festivals in China. The Chinese government has declared a 7-day public holiday for the Chinese New Year (Spring Festival) during February 18-24, 2015. Most Chinese are returning to their domiciles to celebrate with their families or travel elsewhere at home or abroad. It is also a ‘Golden Week' for travel-related businesses in China and other countries when they accelerate marketing promotions vying for Chinese tourists – especially those travelling with their families, friends or companies – to celebrate the festival, including in Thailand, being one of the top holiday destinations among the Chinese.
Thailand's Chinese tourist market began to recover with double-digit growth in arrivals during the final two months of 2014. That positive sign has continued into the Chinese New Year here, where the tourism climate is now more favorable than last year amid domestic political strife.
The outlook for China's outbound tourism seems bright during the Chinese New Year because more Chinese are planning to spend holidays abroad. Their preferred destinations are largely within Asia, including Thailand. Many will likely visit Bangkok, Chiang Mai, Phuket and Krabi – that tend to attract a lot of Chinese all year round – plus other attractions in the eastern region, where attractive promotions are being offered to gain more Chinese travelers as businesses are hoping to cushion a sharp fall in Russian arrivals. Many tour operators now offer travel packages combining easily-linked venues, e.g., Bangkok-Pattaya-Samet packages.
Given those factors, KResearch believes that the return of Chinese travelers to Thailand during the Chinese New Year is a positive sign towards tourism business here; therefore, we expect that their arrivals will reach perhaps 1.35 million during 1Q15, rising 30.2 percent YoY, compared to a low 1Q14 base when they contracted 11.9 percent. They should generate perhaps THB54 billion in revenues for travel-related businesses, up 32.4 percent YoY.
During 2015, we expect that about 5.25 million Chinese tourists will visit Thailand, increasing 13.5 percent over the contraction of 0.3 percent during 2014, helping add around THB218.6 billion to various tourist destinations, which would thus be a 15.2 percent increase YoY, versus meager growth of 1.0 percent in 2014.
However, Thai travel-related businesses may face certain challenges ahead towards marketing campaigns to attract more Chinese, largely due to steepening competition elsewhere to gain a share of outbound Chinese tourist arrivals.
Those challenges, along with higher costs incurred from efforts to tap into new tourist markets within China, have forced Thai travel-related businesses to refocus on repeat Chinese arrivals, particularly those having high purchasing power, e.g., health/cosmetic surgery tourists and high-end travelers.

Meanwhile, a negative reputation of some Chinese tourists in the eyes of Thai people and our reputation as being infamous for tourist scams as perceived by Chinese tourists are issues that need to be addressed quickly by relevant agencies, especially given the steady increase in Chinese travelers foreseen ahead. Ways to rectify these perceptions may include introducing tourist advice manuals along with enforcement of related laws, plus campaigns to encourage Thais towards being good hosts to international tourists, e.g., helping to ensure their personal safety and the security of their belongings.

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