TOURISM

More challenges lie ahead

Despite various efforts to upgrade the industry and attract more visitors, local businesses remain hard pressed, mostly by external factors

By NONDHANADA INTARAKOMALYASUT

Campaigns have been launched to counter setbacks in recent years.

Thailand's tourism industry has undergone major structural and strategic changes since the Thaksin administration took office, all of which are aimed at boosting tourist arrivals. But the old debate over quantity at the expense of quality persists.

Identified as the key sector leading the economic recovery, the industry was given a higher profile with the establishment of Tourism and Sports Ministry as part of the bureaucratic reforms enacted in October 2002. Up until then, the industry had been supervised by the Tourism Authority of Thailand (TAT) whose main tasks involved marketing and promotion. Several innovative schemes, including an initiative to develop new market segments, have since been launched to attract more quality tourists.

But it has been an uphill task. The government has had to deal with a slew of challenges both at home and abroad. Among them are terrorist threats, wars, Sars and bird flu outbreaks and, most recently, unrest in the South.

With the presence of the new ministry, the industry was expected to gain more from the ministry's increased regulatory authority and flexibility to co-ordinate more effectively with other state and private agencies.

The ministry has four key offices: the Office of the Minister, Office of the Permanent Secretary, Office of Tourism Development and Office of Sports and Recreation. The TAT has become a state enterprise under the ministry and acts exclusively as a marketing arm for the industry.

As the sole regulatory body, the ministry has asked provincial governors to participate more in promoting tourism destinations while local communities were encouraged to develop products to sell to tourists. The government also has allocated funds for local projects with potential.

The Office of Tourism Development was tasked with conserving existing tourist destinations and developing new attractions. However, it has yet to play those roles actively, as the Constitution gives local communities and their administrations the mandate to oversee their own tourist products and services.

The office also oversees related activities, such as attracting foreign film producers to generate more income and promote the country worldwide.

Under the office, a body was set up to provide one-stop services to facilitate international film production in Thailand such as granting licences by co-ordinating with other local agencies which were scattered among five different ministries in the past.

However, industry observers expressed concerns about the red tape typical of a government agency and whether its officials had a deep understanding about tourism since most of the staff had sports backgrounds.

In addition to the significant change in the organisation, the Tourism Council of Thailand, a key body formed by the private sector, was also established to support tourism-related operators and communicate with the public sector. The council not only acts as the representative of the private operators but also supports related businesses by setting the 'Tourism Clinic' to provide the industry with advice, assistance and support.

The clinic acts as a centre for human resources, advisory services, training and technical support, said Vichit Na Ranong, the council chairman.

Besides the structural change in the industry, the government has launched several strategic plans to boost the country's tourism by using proactive marketing tactics.

Unlike in the past when tourism concentrated around Bangkok, the government has tried to set a trend by developing new attractions such as Koh Chang and promoting established destinations in the provinces like Chiang Mai and Phuket.

As well, the government is now trying to develop Chiang Mai and Phuket as world-class destinations for Mice (meetings, incentives, conventions, exhibitions) visitors. Since this group of visitors generally spends about three times more than regular tourists, it has high potential to become a lucrative niche of the local tourism industry.

Through the TAT, international convention and exhibition halls will be built in the two provinces as part of the government's policy to draw more quality tourists from mice, spa, golf, eco-tourism and honeymooners.

Marine tourism was also targeted as another niche segment to lure premium tourists. Tax rates have been revised and some government regulations relaxed such as the one limiting the length of stay of visiting yachts.

With the government's support, the value of marine tourism in Thailand could jump annually from the current level of 1.1 billion baht per year to 11 billion baht within 10 years.

At the same time, the government is strengthening ties and co-operation in terms of marketing, transport and investment with neighbouring countries in order to develop Thailand as the main gateway for tourism in the region. Another significant milestone of the government's policy on tourism was the emergence of low-cost airlines.

The initiative aimed to boost domestic tourism since their low fares make air travel more affordable for the people.

Other schemes to encourage Thais to travel within the country includes state funding for free holiday for students and local administrative agencies, as well as cut-throat prices of tour packages for local tourists during the Sars crisis.

On the international front, several initiatives have been launched such as the Be My Guest campaign, a series of advertisements through international media in which Mr Thaksin was the presenter himself to invite foreign tourists to the country.

The government also offered a 10-million-baht Sars insurance policy to foreign tourists as part of a programme to reassure travellers that the country was free from the deadly virus during the second quarter of 2003.

But the most-criticised scheme was the one-million-baht Elite Card membership, the brainchild of the premier to attract big spenders to the country. The lifetime membership entitles holders to a variety of benefits, including visa privileges, fast-track immigration, free services in selected golf courses, spas and hospitals. However, the campaign has yet to meet its goal of attracting one million members within five years. So far, only 400 members have signed up.

To protect tourists from fraud, an insurance fund is likely to be introduced in Thailand to compensate visitors who have been cheated by tour operators. The plan was the first for the country's tourism industry which will compensate those who can prove that they paid for services that were substandard or non-existent.

Another important change in the tourism industry is the implementation of a national hotel star rating system which will be completed in 2004. The official hotel standard is expected to increase confidence and credibility among tourists, which will eventually benefit the industry overall.

However, the industry is facing growing obstacles in the future from external factors such as terrorism, high oil prices, higher interest rates, as well as local problems like the violence in the South. Such factors are expected to have strong impacts and make 2004 another challenging year for the local tourism industry.