Martial law hurts tourist arrivals

Bangkok's bustling night life and James Bond Island near Phuket, shunned by tourists amid political turmoil, must brace for empty cash registers as the imposition of martial law in Thailand deters holidaymakers.

Soldiers keep watch from a military vehicle while stationed outside the Royal Thai Police headquarters as traffic drives past in central Bangkok on Tuesday. (Bloomberg photo)

Visitors to the country may fall 5% this year, the biggest drop since 2009, as the United States and Hong Kong governments tell their people to be cautious while travelling to the nation. Foreigners arriving in Thailand already dropped 4.9% in the first four months of 2014 from a year earlier to 8.62 million, according to the Department of Tourism.

With tourism accounting for as much as 10%t of gross domestic product, keeping hotels and shopping malls open and busy is key for Southeast Asia's second-largest economy, famous for its ancient Buddhist temples and pristine beaches. Over the last decade, Thailand's travel industry had been bruised as a siege of the Suvarnabhumi airport by protesters and political violence in capital Bangkok prompted airlines to stop services.

''It's not good for Bangkok and not good for tourism in Thailand,'' said Mario Hardy, chief operations officer at the Pacific Asia Travel Association in Bangkok, which made the visitor forecast. ''Tourism is a huge income for the country, so this is not helping.''

The army imposed martial law nationwide after months of political turmoil that brought down the government and tipped the economy into a contraction. ''The move is not a coup and people should not be concerned,'' army chief Gen Prayuth Chan-Ocha said.

Singapore Airlines is closely monitoring the situation in Thailand and hasn't cut any flights so far, the carrier said in an e-mailed statement. The airline had scrapped 43 flights to Bangkok between Jan 14 and Feb 27. Thai Airways International and Cathay Pacific Airways also said their flights haven't been affected on Day 1 under martial law.

''Things were starting to get better, but unfortunately this announcement is going to put the situation back to where it was a few months ago,'' Mr Hardy said. ''Hotels are now worried that travel advisories will impact their business again.''

While political unrest has slowed demand for travel to Thailand, it has yet to cause any cancellations in bookings, according to Chan Brothers, a Singapore travel agent.

Three-month advance bookings for hotels in Thailand was 26% in March, compared with 32% a year ago, according to the Bank of Thailand. The rooms were 58% occupied that month, compared with 72% a year earlier.

Bangkok, which hosts more than half of the foreigners coming into the country, posted a 14% decline in visitors in the first four months of this year. Tourism has been hit adversely by the political stalemate, DBS Group Holdings's research arm said in a May 16 report.

The hotel occupancy rate has now fallen by about 13 percentage points compared with the third quarter of last year, while the monthly number of tourists is down by about 450,000, DBS said.

These numbers are pretty much equivalent to those seen during the deadly clashes in March-May 2010, it said.

News coming out of Bangkok is making travellers like Rachel Tan and Maria Joseph Khoo in Singapore think twice about visiting Thailand.

Ms Tan is reconsidering a trip to Bangkok with her boyfriend and her mother this Sunday, while Ms Khoo is looking for an alternative destination after her parents objected to her plan to visit the country in June.

''I would love to go ahead with the trip,'' said Ms Tan, an events producer at Marina Bay Sands in Singapore. ''But, it would depend on how the government advisory changes.''

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