In recent days, the National Economic and Social Development Council (NESDC) has revised its projection for foreign tourists this year from 5 million to 5.5 million visitors and suggests that the country can use the renewed impetus from the sector to drive GDP growth for 2022 of up to 5%.

The Thai government is planning to scrap all entry restrictions on foreign travellers sometime this year when it declares the virus as an endemic disease according to the Ministry of Tourism and Sports Phiphat Ratchakitprakarn. On Wednesday, the kingdom did away with the requirement for a second test on arrival on the 5th day for incoming tourists following calls by business leaders to allow the industry to revert to normal. This is happening at the same time as economic data suggests strongly that foreign tourism income has a far higher impact on the country’s economy than originally thought due to its impact on confidence and the level of indirect economic activity generated.

Minister of Tourism and Sports, Phiphat Ratchakitprakarn, has said that Thailand will scrap all restrictions on inbound tourists once the COVID-19 virus has been declared endemic, something that is expected this year. It comes as the kingdom’s economic performance begins to improve since the reopening of its borders under the ‘Test and Go’ regime from November 1st last which has seen growth for 2021 revised to 1.6% and a projected growth rate for 2022 now forecast at up to 5%.

Thailand, on Wednesday, gave the green light to the suspension of the mandatory 2nd COVID-19 test for visitors from March 1st next. The move will see the scrapping of any need for a hotel reservation on the 5th day after arrival. For now, the requirement will be for a self-test to be undertaken by the visitor using an antigen test kit.

The announcement comes amid a surge in Omicron virus infections across the kingdom with 23,557 cases confirmed on Thursday. At the same time, there is growing confidence within the government and the Ministry of Public Health that this pandemic crisis is winding down.

Growing calls from the tourism sector for all controls to be lifted and a return to normalcy that existed up to April 2020 being heard with election looming

Indeed, there are growing calls from the travel and foreign tourism industry in the kingdom to scrap all requirements on entry including the need to undergo any subsequent COVID-19 test and a streamlining of the process to allow the country to begin recovering its foreign tourism market which has been dormant since 2020.

There are already signs that the reopening of the kingdom to foreign tourism late last year has brought with it the sort of economic momentum that the government, with the looming and growing possibility of an election on the horizon, is determined to foster.

Uptick in economic data from 2021 attributed to the Test and Go entry regime launched in November 2021 

In recent weeks, the confirmed growth rate for the Thai economy in 2021 has been upgraded to 1.6% following a disastrous 6.1% contraction in 2020. It is one of the slowest in Southeast Asia. At the same time, for the region’s second-largest economy, the updated figure is far ahead of expectations with all indicators towards the end of 2021 showing Thailand in very real danger of experiencing a second year of contraction or at best, negligible growth.

Shaky economic recovery as planners target only a 1% gain in 2021 with rising headwinds in Quarter 4
Thailand pushes ahead with foreign tourism drive, may defer switch to antigen testing over Omicron

The situation appears to have been turned around with a 21.3% rise in exports in the last quarter of 2021 and the arrival of approximately 340,000 foreign tourists in the same period, driven by the ‘Test and Go’ entry regime which offered far less restricted access to the kingdom from November 1st 2021.

Tourism provinces at the heart of the Thai economy and GDP rebound, accounting for 70% of annual GDP

The improvement in the economic performance may be linked to a trend seen in economic data recorded in May last year which showed that 15 key provinces across the country accounted for 70% of its GDP including many of the main foreign tourism centres.

These are Bangkok and its five hinterland provinces which are Nakhon Pathom, Nonthaburi, Pathum Thani, Samut Prakan and Samut Sakhon. In addition to these come Chachoengsao, Chiang Mai, Chonburi (including Pattaya), Khon Kaen, Nakhon Ratchasima, Phuket, Rayong, Songkhla and Surat Thani (Ko Samui).

Figures from Phuket Sandbox show a high level of indirect economic activity which suggests that foreign tourism drives up to 26% of the kingdom’s GDP

On Wednesday, figures released concerning the Phuket Sandbox scheme which embattled Prime Minister Prayut Chan ocha claims as a signal victory for his government and a turning point in the country’s economic fortunes last year showed that 333,784 foreign tourists had generated direct revenue of ฿18 billion or ฿59,927 per head.

However, the government, this week, claimed a further ฿25 billion had been generated in the knock-on activity from the reopening or the equivalent of ฿74,898 per incoming tourist.

In 2019, Thailand’s GDP was $544.3 billion of which $62.29 billion was direct expenditure by 39.8 million foreign tourists that equated to ฿1.93 trillion. This represented 11.45% of the country’s GDP.

Based on the figures for Phuket however, since July 1st, it could well suggest that the foreign tourism industry in Thailand drives up to 26% of the country’s overall economy including indirect activity.

Explains the long term economic damage inflicted on the country’s GDP caused by its closure to foreign tourism in April 2020 and continued restrictions

This would help to explain the dramatic and apparently, long term damage to the kingdom’s economy since 2020 as the country has yet to experience the sort of economic rebound we have seen in western economies.

It would certainly explain the government’s determination now to bring foreign tourism back to life even amid the Omicron virus storm which appears to be resulting in lower hospitalisation rates with less severe illness and deaths running at 0.2%.

The kingdom is currently experiencing deaths in the order of 30 per day compared to 300 last year at the height of the pandemic driven by the Delta variant.

CCSA eased restrictions including a lowering of the insurance requirement as Minister explains that incoming travellers are less likely to be infected

This scenario was emphasised ahead of this Wednesday’s meeting of the Centre for Covid-19 Situation Administration (CCSA) where the decision was made to ease the burden on incoming travellers. This was supported by the Minister of Public Health Anutin Charnvirakul and the powerful Department of Disease Control within his ministry.

The easing of entry conditions announced by the CCSA, chaired by Prime Minister Prayut Chan ocha, came after public health officials endorsed the move which also included a reduction in the insurance cover required for inbound travellers from $50,000 to $20,000. Last year, at the outset of the Phuket Sandbox reopening, in July, the requirement stood at $100,000.

Speaking before the meeting, Minister Anutin highlighted the low level of infections being detected among incoming travellers to Thailand which, he said, was running at less than one in one thousand and confirmed that the current surge in the kingdom is being driven by local sources and clusters.

Minister confident the current virus surge will ease as ‘Test and Go’ entry scheme continues its success

He was confident, however, that this surge would plateau and begin to decline in due course which would be a critical moment in the country’s fight against the disease.

The Test and Go entry regime for foreign tourists appears to have continued its success since it was restarted on February 1st after a pause from late December last year due to fears of the arrival of the Omicron virus strain in Thailand.

On Wednesday, Dr Taweesilp Visanuyothin, the spokesman for the Centre for Covid-19 Situation Administration (CCSA), confirmed that since the start of the month, 302,000 visitors had been approved under the scheme which is currently being driven by western tourism into Thailand.

The top destinations are Bangkok and Chonburi which is home to Pattaya, the tourist resort which just six months ago was reduced to a ghost town.

Wednesday’s move also comes in the face of recent calls from the Pheu Thai Party to strengthen the Covid 19 testing regime in the face of rising levels of infection.

Business leaders urge the government to seize this moment to drive foreign tourism momentum and boost it for the rest of the year by opening up further

Nevertheless, the foreign tourism industry leadership in Thailand and wider business lobbies have begun urging the government to do more to bolster the sector’s prospects, particularly after April when foreign tourism normally has its off-season until October.

Mr Sanan Angubolkul, the Chairman of the Thai Chamber of Commerce and Board of Trade has emphasised that the revival of the industry was necessary to also boost domestic tourism and overall commercial confidence in the kingdom.

Before Wednesday’s news from the government, he made the point that travellers are also tested before embarkation for Thailand and have to be fully vaccinated before they are allowed to travel here.

‘Many countries focus only on full-dose vaccination and RT-PCR test results 72 hours before entering the country, such as Greece, UAE, France, Germany, Austria or even the United States. The Thai Chamber of Commerce, therefore, considers that if the RT-PCR examination can be cancelled on the 5th day, it will encourage more international travel. Although the current epidemic of omicron in the country is likely to increase.’

Minister of Tourism and Sports Mr Phiphat says that all restrictions will go once the virus is declared an endemic disease, likely to happen this year

It also appears that business leaders may be pushing an open door as recently, Minister of Tourism and Sports, Phiphat Ratchakitprakarn has indicated that all testing for the virus and other restrictions may be scrapped at the point where the virus is declared an endemic disease in the country.

This is likely to happen this year, according to officials at the Department of Disease Control at the Ministry of Public Health and would come as a timely boost for this year’s High Season which begins again on October 1st next.

Thai economic forecasters are already increasing projected figures for foreign tourists in 2022.

Top economic body forecasts strong GDP growth on more foreign tourist arrivals as it raises projections

In recent days, the top official at the National Economic and Social Development Council (NESDC), the government’s top economic body, Danucha Pichayanan, has raised that body’s estimates for foreign tourists this year from 5 million to 5.5 million.

The NESDC is also projecting a higher GDP growth rate in Thailand for 2022 of up to 5% which is ahead of recent projections.

This outlook makes it easier to understand why the government is determined to prime the foreign tourism economic engine to take the economy forward this year.

This approach was summed up by Mr Supant Mongkolsuthree the Chairman of the Federation of Thai Industries (FTI) this week when he called on the government to cancel all COVID-19 restrictions in the kingdom to allow the private sector to get fully back to work.

He also called for the complete abolition of all entry restrictions for foreign tourists including the Test and Go entry regime and the Thailand Pass system. He wanted to see the situation revert to the status quo that existed before April 2020.

Join the Thai News forum, follow Thai Examiner on Facebook here
Receive all our stories as they come out on Telegram here
Follow Thai Examiner here

Further reading:

Opposition targets Test and Go for spreading the virus as government insists on endemic status

Test and Go ready for take off again but this time with added baggage including a second PCR test

PM orders a re-evaluation of the balance between public health and economy as Omicron fears ease

Pandemic drawing to a close, senior public health official says growing Omicron strain is harmless

Top official describes the popular ‘Test and Go’ entry as a loophole exposing Thailand to Omicron

Tourism business owners think the unthinkable, the Omicron storm may bring with it good news

Minister suggests that ‘Test and Go’ now paused entry regime may be restarted in the New Year

Omicron nightmare for already troubled tourism sector: plan to suspend ‘Test and Go’ entry route

Omicron has arrived in Thailand but top officials believe they can manage an escalating situation

Thailand pushes ahead with foreign tourism drive, may defer switch to antigen testing over Omicron

Health officials asks for a review of the list of 63 countries allowed to enter without quarantine

Nightlife to reopen on a certified basis as officials try to balance public health and the economy

Thailand Pass is being upgraded but passenger stress stories continue with cancellation threats

Tourism reopening may lose momentum as government pivots back to public health priorities

Incoming passengers vent frustration at problems and bugs with the Thailand Pass system this week

Kingdom may see up to 1 million tourists this year but it will be an uphill battle to get back to 2019

Vaccinated tourists from 63 countries can leave SHA plus hotels after 1st night says top official in Phuket

Fears for travellers trying to access Thailand in the interim period as Thailand Pass launch nears GO

Russian and Indian travellers unhappy at entry rules for November 1st, call for simpler plans

Most tourists will be able to travel freely in Thailand once they pass their first test on arrival here

46 countries green-lighted as Thailand’s tourism business is set to take off from November 1st

Bright lights may be turned on again for foreign tourism as hated Certificate of Entry is to be axed

TAT boss: quarantine remains for 1 day to test all visitors, no going back to old tourism pub scenes

PM’s reopening order-only the beginning of the end of this cataclysmic crisis for Thai tourism

High-quality tourism dream may be making the COVID-19 crisis for the industry even worse than it should be

Tourism chief again plans to open up Thailand’s rock bottom tourism industry to cryptocurrencies

Dysfunction hits reopening of Thailand to tourism as Health Minister dismisses October 1st date

Bangkok reopening delayed as figures for fully vaccinated must nearly double by October 15th to go ahead

New normal tourism may see foreign and local tourists segregated at Pattaya tourist attractions

Only 13% will visit Thailand under the kingdom’s demanding entry process with 2021 economic growth at stake

October reopening of foreign tourism to Thailand could be another false dawn with cumbersome entry regime

Richest man in Thailand says COVID-19 is like a World War, the kingdom could end up a big loser in the end

Foreigners in Thailand have nearly ฿600 billion in the bank as inequality and poverty rise alarmingly

Rising prospect of GDP contraction for 2021 may see government breach the legal public debt limit

A dead mother beside her children and a taxi driver who slept, show us a nation riven by an extended crisis

Economic fears rising as Thailand faces a bigger crisis than 1997 with rising job losses and debt

Baht falling with confidence in Thailand waning as foreign tourism closure and virus drive funds out

Central bank to lower GDP growth forecast as its attention turns to private sector debt management

Thailand to reopen to ‘big fish’ tourists as a cryptocurrency friendly haven says promotion agency boss

Failure to pass the ฿500 billion borrowing decree could lead to the dissolution of parliament

Baht to strengthen later in the year even after July as foreign tourists will return says top bank economist

Industry leaders and central bank all warn that foreign tourism must return to avoid a collapse

Refloat of foreign tourism in the 2nd half of 2021 with vaccines pushed by minister and industry for the sector

Fact – only 6,556 visitors arrived in Thailand last month compared to 3.95 million in December 2019

Desperate foreign tourism business concerns are clinging to straws as they try to survive the crisis

Strict entry criteria to remain as officials await clarity on the medical status of vaccinated people

Challenge of the virus and closure to tourism leads to major long term changes in the Thai economy

Finance Minister says economy must pivot away from tourism with a switch to S-Curve industries

Steady as she goes economy driven by exports and public investment with a 3.3% growth rate forecast for 2021

Thailand’s tourism boss targets thousands instead of millions as public health is prioritised above all