End of emergency brings hope

Economy March 19, 2014 00:00

By Business Reporters
The Nation

3,133 Viewed

Tourism businesses and foreign investors have welcomed the government's decision to lift the state of emergency in Bangkok, expecting the move to facilitate the recovery of the tourist trade within one or two months.

However, if the political dispute that triggered the emergency decree in the first place is not resolved soon, they believe the overall economy will need more time to recover.
Yutthachai Soonthronrat-tanavate, president of the Association of Domestic Travel, said there was no doubt that lifting the decree would be a boon to inbound tourism. It will help restore foreigners’ confidence in travel to Thailand, especially among Japanese and Chinese. Also, it should ease the problem of travel-insurance firms refusing to cover damages due to political causes. 
However, some markets, especially Hong Kong and Taiwan, will remain cautious after the Internal Security Act replaces the emergency decree to handle the protesters in Bangkok. The Hong Kong government says it will have to evaluate the situation for at least 10 days before making any changes to its travel warnings. 
Yutthachai said there remained a risk that red-shirt pro-government protesters would cause problems for the industry as well. If their demonstrations get more aggressive, he is worried that this would be another blow to the country’s tourism image. 
“However, if nothing serious happens, I think lifting the decree will help boost tourism sentiment, with an inflow of foreign tourists during the Songkran Festival,” he said.
Supawan Tanomkieatipume, chairwoman of marketing at the Thai Hotels Association, said removing the decree would be good for the tourism industry in Bangkok, but only “marginally” because of the timing of the move. Thailand is moving into a low-season period, and that means the number of foreign tourists will remain low.
One more important point is that no government agency has come out to deliver a clear message of how the Thai tourism scene will change after the decree is lifted. This means a cloud is still hanging over the industry.
“My colleagues in the industry in Bangkok have been hurt by the prolonged political situation. Advance bookings for the Songkran Festival have not been good to date,” she said.
However, she believes Songkran will be as dynamic and colourful as usual this year, even as Singapore has announced a competing Water Festival event next month. The Land of Smiles can keep its charm with big spaces and various kinds of activities during the period, luring a big number of foreign tourists.
Yutthachai shrugged off the Singapore announcement, saying Songkran in Thailand was still big with more than 100 locations across the nation joining in the celebration. In fact, Songkran is celebrated not only in Thailand, but also in Laos and Myanmar. 
It is also not new in Singapore – the Thai community there has been organising celebrations for a decade. 
Isara Vongkusolkit, chairman of the Board of Trade of Thailand and the Thai Chamber of Commerce, said private enterprises were taking a positive view after the caretaker Cabinet decided to withdraw the emergency decree, believing economic growth should recover within a couple of months.
Restoring confidence 
Kalin Sarasin, secretary-general of the Board of Trade, said investor confidence would be restored. He pointed out that since the decree was announced, many foreign companies had postponed their plans to travel or do business in the Kingdom and many insurance companies refused to give them travel coverage.
He said more business should be done in the Kingdom now, which should help promote stronger economic growth this year. 
Stanley Kang, chairman of the Joint Foreign Chambers of Commerce in Thailand, also welcomed the lifting of the state of emergency. He said it was a positive sign that would give foreign businesspeople and tourists more confidence to come to the Kingdom.
Suvabha Charoenying, managing director of Thanachart Securities, said the tourism sector would be among the first beneficiaries, and she hoped the overall situation would become better. 
She said the Stock Exchange of Thailand might soon see the restoration of some initial public offerings plans that were earlier put off because of the political situation.
Patchara Samalapa, executive vice president of Kasikornbank, said the image of Thailand in terms of the tourism sector would resume and inbound tourists, especially from Europe, would return. 
Adisorn Sermchaiwong, senior executive vice president of CIMB Thai, said cancellation of the decree would also help restore the incomes of employees in hotels in Bangkok as tourists started flowing back into the capital. When retail consumers are more confident in the political situation, the sentiment for spending and demands for loan will gradually recover, he added.