The rising emergency and disruption to prospects for tourism come amid plummeting consumer and business confidence as the overall Thai economy has been hit with a record high consumer price index for February and faltering business activity.

Thailand’s tourism promotion agency will be attending a fair in Moscow over the coming days to drum up more tourism activity between the kingdom and Russia. Officials from the tourism promotion agency’s Moscow office will be attending the Moscow International Travel & Tourism Exhibition from March 15th to 17th even as stranded tourists in places like Phuket and Ko Samui have experienced difficulty in paying their bills. The ongoing war in Ukraine has led many senior figures within the foreign tourism sector across the country to emphasise that the kingdom remains a neutral party to the conflict with calls for Thailand to explore its payments infrastructure which has been found to be at the mercy of western sanctions.

Russian tourists holidaying in Phuket last week as Tourism Authority of Thailand Governor Yuthasak Supasorn (right) tells tourism sector operators that everything must be done for stranded Russian tourists and that more are on the way. At the same time, Mr Yuthasak dismissed fears over an American advisory to its nationals not to travel to Thailand. Due to sanctions following the Russian invasion of Ukraine, both Visa and MasterCard have suspended operations in the country leading industry bosses in Thailand to call for greater access to non-western networks including the Chinese Union Pay service headquartered in Shanghai.

Thailand’s tourism supremo and Tourism Authority of Thailand boss, Governor Yuthasak Supasorn, has cautioned that foreign tourism numbers may be off by 30% in the first quarter of 2022 due to rising inflation and global insecurity caused by the war in Ukraine.

It comes as there is an emergency within the kingdom with nearly seven thousand stranded Russian tourists who are facing extreme difficulty in making payments due to swingeing trade sanctions imposed by western countries on the Russian economy including its transport and financial sector since the war was declared on February 24th last.

Many Russians staying long-term in Thailand as the Tourism ministry scrambles to assist cut off tourists

Figures just released by Thai authorities show that there are, in fact, upwards of twenty thousand Russian nationals in Thailand but, according to the Ministry of Tourism and Sports, only 6,577 are tourists.

Officials are currently coordinating a response to the emergency which is centred on Phuket, Krabi, Pattaya and Ko Samui which is home to the majority of foreign tourists from the Russian Federation whose armed forces are currently bogged down in its invasion of Ukraine.

Some Ukrainian tourists and visitors also require assistance from authorities in Thailand as normal travel and commercial facilities have been disrupted with both countries suffering from the fallout of this war.

Visa and Mastercard have suspended operations in Russia while flights were grounded last week

Officials with the Tourism Authority of Thailand and the Tourism Ministry are dealing with key problems which have arisen namely people who have found that they cannot access flights to return home either to Russia or Ukraine as well as tourists and visitors who have found it impossible to make payments or access basic financial facilities.

Russia’s financial system, as well as its international flight network, was very much dependent on international systems.

This has meant that the precipitous action by credit card firms such as Visa and Mastercard to suspend operations in the country and the severance of Russian banks from the international financial systems controlled by the West has very painfully impacted the Russian economy and most acutely its nationals holidaying or living in Thailand.

US advises Americans not to travel to Thailand

The challenge for Thailand’s tourism promotion agencies and planners appeared to become even more testing this week when the US Centers for Disease Control and Prevention issued an advisory urging Americans to avoid travel to Thailand.

The top medical authority raised the country to Level 4 or Very High-Risk status concerning the disease.

Thailand plans to end the COVID-19 emergency in the kingdom by July 1st by declaring the disease endemic. 

Thailand moving to scrap all tourist restrictions this year once the Covid virus is declared endemic

This move should, according to Minister of Tourism and Sports, Phiphat Ratchakitprakarn, be followed by the scrapping of all restrictions and conditions for entering the country by tourists.

Tourism chief Yuthasak not worried about new warning to potential US tourists based on experience

Nevertheless, the rates of infection for the virus have remained persistently high, a situation also seen in some other countries in the region such as Hong Kong where authorities in the now Chinese controlled city have been faced with thousands of deaths in recent weeks.

The American advisory pulled no punches: ‘If you must travel to Thailand, make sure you are vaccinated and up to date with your Covid-19 vaccines before travel. Even if you are up to date with your Covid-19 vaccines, you may still be at risk for getting and spreading Covid-19.’

In response to the move, Mr Yuthasak of TAT indicated that, from previous experience, he thought US holiday makers visiting Thailand, particularly those who are vaccinated, would not be deterred.

Survey shows hotels, on average, up to the Ukraine War on February 24th had only 30% occupancy

The latest crisis for the industry, indeed Thailand’s economy and the wider world, comes as the Thai Hotels Association released a survey of its members carried out just up to the day before the invasion of Ukraine on February 24th last.

It showed that hotels in Thailand had only seen a rise in occupancy to 30% since the country’s wider reopening to foreign tourism on November 1st last. 

There were more positive signs in January when that figure rose to 34%.

The President of the body, Marisa Sukosol Nunbhakdi, explained that only 20% of hotels in Thailand specially cater to foreign tourists who accounted for more than 50% of their guests.

Throughout the pandemic crisis, however, since 2019, we have seen that Thailand’s domestic tourism market appears to follow trends linked with its international market.

Thailand’s consumer confidence falls in 2022 with a historically high consumer price index in February

The domestic tourism market has also been impacted by rising inflation since January with figures just released showing consumer confidence in Thailand at a 5 month low due to rising oil prices which rocketed after the invasion of Ukraine.

The index fell to 43.3 in February from January when it stood at 44.8. It fell also in January from December’s figure of 46.2.

The index signifies severely weakened purchasing power by Thai consumers. 

Thailand’s consumer price index for February 2022 reached a historic high for the country at 104.1 although it fell during the COVID-19 crisis before the country’s economic recovery began late last year.

The Thai Hotels Association survey shows that 82% of hotels are still far behind their financial performance in 2019 with 51% experiencing a tightening of financial liquidity after January this year. 

Tourism industry emphasises that it is neutral in the war between Russia and Ukraine despite UN vote

The interruption to Thailand’s tourism economy by the war in Ukraine is not being taken lying down by Thai officials who have been quick to emphasise that Thailand is neutral in the conflict.

It has been pointed out that despite the Kingdom’s surprise vote to censure the Russian Federation for its invasion of Ukraine at the emergency UN General Assembly meeting in New York on March 2nd, Thailand has not participated in imposing sanctions on a country it enjoys friendly relations with.

Thailand votes on the right side of history in UN deploring Russian military action in Ukraine

Reacting to the crisis unfolding, this week, for Thailand’s Russian visitors, Mr Yuthasak, the TAT boss, told tourism operators that everything must be done to accommodate the kingdom’s visitors from Russia because there are more coming.

‘We have to be good hosts and take care of everybody,’ he declared. ‘There are still Russian tourists on their way here.’

Frantic efforts to assist Russian tourists with the ruble losing 70% of its value since the invasion began

This comes despite the suspension of international flights by Aeroflot and other carriers which flew into Thailand up to last weekend and the Russian currency, the ruble, losing up to 70% of its value since February 24th last.

Frantic efforts are believed to be underway to link the ruble and Russia’s banking network to Chinese financial systems as well as efforts to use cryptocurrencies as a medium.

Tourists from Russia were the largest contingent of foreign tourists entering Thailand in January 2022 with 23,760 arriving here compared, for instance, to 9,712 from the United Kingdom and 7,315 from the United States.

The numbers from Russia increased dramatically from November.

For last year, Germany accounted for the highest number of visitors to Thailand at 45,874 visitors followed, in order, by the United Kingdom and the United States. Russia, however, sent 30,759 foreign tourists last year, accounting for 7.2% of the market.

Russia sends more foreign tourists to Phuket than any other country says Phuket Tourist Association

The importance of Russian visitors is particularly acute in Phuket where the country is the resort’s largest market, according to Bhummikitti Ruktaengam, the President of the Phuket Tourist Association.

Mr Bhummikitti led last year’s campaign to reopen Phuket early to foreign tourism in a programme that became known as the Phuket Sandbox.

‘Russia has contributed the most tourists to Phuket of any country since last October. Losing this market will have an inevitable impact on the industry,’ he warned this week.

It comes as Thailand’s tourist promotion bodies have launched a concerted campaign not only to find payment arrangements for stranded Russian tourists here through Chinese gateways such as Union Card and provide cheaper temporary accommodation for those in need while organising flights back to Moscow.

The tourism promotion body TAT is also redoubling efforts to expand its foreign tourism trade with Russia at a time when the country is being shunned by the western world and corporations.

Top Thai tourism agency confirms that the country will be participating in Moscow trade fair this week

On Monday, Chattan Kunjara Na Ayudhya, the Tourism Authority of Thailand (TAT) deputy governor for Europe and the Middle East, gave a presentation to the Phuket Tourist Association highlighting efforts in Russia. The webinar was titled: ‘The Landscape of Tourism: Russia Case Study’.

In it, he warned that bookings have declined from Europe because of the war and that cancellations had also been seen particularly from Eastern Europe.

He confirmed that the Tourism Authority of Thailand would be participating in the Moscow International Travel & Tourism Exhibition from March 15th to 17th through its Moscow office.

The Director of the Tourism Authority of Thailand (TAT)’s Moscow office, Khanittha Phanworawat, along with Thailand’s ambassador to Moscow, Sasiwat Wongsinsawat, also appeared to be working positively towards the goal of attracting more Russian tourists to Thailand.

5.5 million affluent Russians targeted by Thailand

Ambassador Sasiwat highlighted that there are 5.5 million Russians who earn more than 100,00 rubles a month and these were the target of the kingdom’s efforts.

He also noted that last year, 6,500 Russians had applied for long term visas to stay in Thailand.

Highlighting Thailand’s neutrality in the conflict, the Tourism Authority of Thailand (TAT) boss in Moscow, Ms Khanittha, drew attention to a recent advisory from the Federal Agency for Tourism in Moscow which advised Russian nationals to holiday abroad in a country that had not sanctioned Russia and named NATO member Turkey, the United Arab Emirates, Egypt and India as examples.

Phuket tourism boss wants to see cryptocurrency options for tourists and links to Russia’s Mir system

In Phuket, the Phuket Tourist Association boss Mr Bhummikitti, meanwhile, called on authorities in Thailand to look into the possibility of using cryptocurrencies to facilitate payments by foreign tourists to the kingdom.

At the beginning of 2022, the Bank of Thailand suggested that, in principle, it stood opposed to allowing the use of cryptocurrencies for payments of goods and services in Thailand and in mid-December 2021 promised a policy and framework to ensure this while further regulating the growing Fintech industry.

Officials are concerned that a rising crypto-asset trend poses a real threat to Thailand’s financial stability

The central bank warned widespread use of cryptocurrency for payment purposes risked destabilising the Thai economy.

Tourism chief has long promoted cryptocurrency projects to prime and extend the country’s earnings

The Governor of the Tourism Authority of Thailand (TAT), Mr Yuthasak, has long promoted the use of cryptocurrencies by foreign tourists to Thailand as a way forward for the kingdom and last year, outlined plans for an ambitious online platform to do so.

Tourism Authority of Thailand (TAT) in pursuit of an online metaverse and cryptocurrency strategy very much divorced from the existing industry
Tourism chief again plans to open up Thailand’s rock bottom tourism industry to cryptocurrencies

Amid the confusion in Phuket as Russian tourists struggle to make payments, tourism chief Mr Bhummikitti called for Thailand’s financial system to do more to assist Russian holidaymakers whose credit cards had failed because of western sanctions.

Concern that international payment systems for tourists in Thailand are too western-centric at this time following Russian chaos on the beaches

He suggested that Thai financial authorities find a way to access the Russian MIR system, a financial network established in 2017 by the Central Bank of Russia and operated by the Russian National Card payment system.

Such a move would require Thailand to look at its financial payment systems which are still dominated by western networks despite the presence in the kingdom of Chinese payment gateways and facilities which have suddenly found themselves in great demand in Phuket, Pattaya and Ko Samui, in recent days, as Russian tourists try to settle their bills while cash-starved Thai hoteliers and tourism concerns attempt to improve their liquidity.

In the meantime, the war and bloodshed continues in Ukraine with many analysts now suggesting a protracted struggle that could last up to three years as the small nation and its populace fight an all-out war for the country’s right to exist.

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Further reading:

Thailand moving to scrap all tourist restrictions this year once the Covid virus is declared endemic

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