Thai tourism plans comeback after unrest

BANGKOK, May 26, 2010 (AFP) - The Thai capital has been mostly scrubbed clean, but it will be some time before images of two months of deadly anti-government street protests fade from the minds of potential visitors.

Thailand's lucrative tourism industry has been gutted by last week's scenes, televised worldwide, of Bangkok reduced to a battle zone in an army crackdown on a "Red Shirt" encampment in the city's ritzy commercial district.

Thailand's National Economic and Social Development board said Monday the Bangkok violence had turned away millions of potential tourists, cutting revenues by 113 billion baht (3.47 billion dollars).

"There will only be about 13 million tourist arrivals this year, a three million drop from our original target of 16 million," the think-tank said in a statement, noting tourist arrivals from within Asia had particularly declined.

Thai Prime Minister Abhisit Vejjajiva (R) sits next to Finance Minister Korn Chatikavanij (L) during a discussion on the country's 2011 Budget at Parliament in Bangkok on May 26, 2010. AFP photo

Many fear that Thailand's image as the "Land of Smiles" has been shattered by the violence that left 88 dead and 1,900 injured since April 10 and saw 36 major buildings torched last week.

"There's no question that there has been a serious effect on tourism," said Bill Heinecke, chief executive of the Minor Group, which owns hotels, resorts and fast food franchises, including a Four Seasons hotel in the protest zone.

He said the industry had been badly dented by media coverage of the unrest as well as travel warnings issued by 47 countries during the protests, some of which advised against visits to all of Thailand, not just Bangkok.

"Directly we've seen room cancellations of 100 million baht (3.07 million dollars)," Heinecke added.

It is the latest episode in several years of political turmoil that has divided the kingdom and at times rocked the tourism industry, which accounts for six percent of gross domestic product.

In late 2008 hordes of frustrated travellers were stranded by a nine-day blockade of Bangkok's two airports by pro-establishment "Yellow Shirts" -- rivals to the Reds.

The latest unrest has not been confined to Bangkok: four provincial halls were set ablaze in Thailand's rural and impoverished northeast, where the Red Shirt have their bedrock support, on the day of last week's crackdown.

Violence also broke out in the northern city of Chiang Mai, another base for the anti-government movement, where people tried to burn buildings and throw home-made bombs after the Bangkok protests ended.

Peter Intrayota, vice-president of the Thai Hotels Association's northern branch, told AFP that hotel occupancy in Chiang Mai -- a popular tourist city -- was down to ten percent as many believed "the troubles are not over."

"Our hotels and streets are empty. Tourists are just cancelling their bookings," Intrayota said. "Ninety-five percent of Chiang Mai residents are Red Shirt supporters. The political situation remains unstable."

This week officials from the tourism industry, including hotel associations and airlines, met to devise a marketing plan to help revive the industry, said Prakit Piriyakiet, spokesman for the Tourism Authority of Thailand.

Meanwhile, Prakit said Thailand's annual tourism forum had been postponed from June until September and the government could subsidise advertising in an attempt to win back travellers from Japan and China, which has cancelled charter flights.

"We will focus on the short-haul market -- the quick win market -- Southeast Asian and Asian countries," Prakit said.

Many tourism officials said they thought it would take about six months for the industry to recover as long as there was not more unrest. However the Minor Group's Heinecke said travellers looking for steep discounts would be disappointed.

"For sure there will be deals around but if you think we're going to slash the rates of our hotels, I don't think that's going to occur," he said. "We learned long ago that if you take rates down, they're going to take a long time to go up."

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