THAILAND: Crackdown On Forced Shopping Tours, Chinese Tourists Opt For Cambodia And Vietnam

With Thailand’s recent crackdown on so-called zero-dollar tours—tour packages priced below cost that often target Chinese travelers and recoup losses from forced shopping and dining—it appears as if neighboring Southeast Asian countries are taking off in its place.

Thailand, previously the number one destination for zero-dollar tours outside China, seems to have succeeded in limiting the notorious tours domestically, but Chinese travelers’ high demand for cheap tours has simply shifted supply elsewhere.

Despite a turbulent year with its recent tourism crackdown and the general unease among tour operators surrounding the Thai king’s passing, Thailand and Japan topped China’s leading online travel marketplace Ctrip’s list of top destinations for the Chinese New Year Golden Week early next year.

If Ctrip’s predictions hold true remains to be seen, but it’s safe to say that reduced visa fees for Chinese tourists—an initiative which started this month—is boosting the attractiveness of tourism in Thailand among Chinese holidaymakers.

For Thailand’s neighbors, the vacuum left by the zero-dollar crackdown provided plenty of opportunities to tap the suddenly untapped demand for cheap overseas travel. As a result, demand for trips to surrounding countries with less regulated tourism industries has picked up, with multiple new air connections between China and Thailand’s neighbors introduced in the last few months.

However, for Thai authorities, there were many reasons to put curbs on Chinese zero-dollar tours. The Thai government has estimated that it lost approximately 70 billion baht (US$2 billion) in tax revenue annually due to the tax-avoiding nature of zero-dollar tours, with profits funneled directly back to China.

Another major concern has been the overcrowding of Thailand’s tourism infrastructure and the fear that budget travelers cannibalize on more profitable market segments.

While not the most profitable market segment, Chinese zero-dollar tourists could still prove a welcome injection of tourism revenues for Thailand’s neighbors. Vietnam, the closest competitor in mainland Southeast Asia, received 7.9 million tourists in 2015—not even a third of Thailand’s 29.9 million arrivals.

In Chinese tourist arrivals, it lags even further behind despite many shared features, such as being a budget-friendly destination that offers many similar geographic traits. Chinese tourists may be beginning to notice, with Vietnam reporting 47.5 percent growth of Chinese arrivals in the first half of 2016.

While foreign tour guides, a feature associated with zero-dollar tours, are officially outlawed in Vietnam, there have been many reported instances of Chinese tour guides operating in the country. Even without zero-dollar tours, the cheaper Vietnam proves a valid competitor for budget-conscious Chinese travelers who would have otherwise gone on zero-dollar tours in Thailand.

Cambodia, another competitor in the market for price-conscious Chinese travelers, is also seeing a growing number of Chinese arrivals and direct flight connections with China. Hun Sen, the Cambodian prime minister, recently announced that he wants to more than double the number of Chinese tourists visiting Cambodia every year—from 800,000 in 2015 to 2 million in 2020.

While demand is picking up in China, Sen himself admitted that Cambodia lacks the number of Mandarin-speaking tour guides required to satisfy demand—presenting an ideal opportunity for Chinese zero-dollar tour operators to capitalize on the opportunity.

For countries with underutilized tourism resources, zero-dollar tours may not seem as off-putting as they are to market leaders like Thailand. While it might be tough to tap into much of the revenue from shopping and tour services provided to tourists on zero-dollar tours, airfare, and to some extent, accommodation strengthen overall tourism revenues.

Both Cambodia’s flag carrier, Cambodia Angkor Air, and several Vietnamese airlines, including its flag carrier, have increased their capacity between China and their respective home countries.

Other countries in Southeast Asia are also gearing up for attracting a larger share of the travel-hungry and rising Chinese middle class. After the rapprochement between China and the Philippines after the election of president Duterte, the Philippines is now considering the introduction of a visa-free policy for Chinese travelers.

Malaysia, meanwhile, has also been picking up steam with Chinese budget travelers to the extent that they have had an effect on Chinese tourism in Singapore, with an increasing number of Chinese visitors to Singapore arriving in tour buses by road from Malaysia and spending significantly less than other Chinese tourists in the city-state.

For China’s rising middle class, budget travel in nearby countries is an attractive and increasingly frictionless affair, with improving visa policies and a growing number of direct flights. While Thailand may be less appealing to the thriftiest travelers than before, neighboring countries are eager to pick up where Thailand left off.


Tourism Observer
www.tourismobserver.com

THAILAND: Aggressive Behavior Tarnishes Phuket Tourism

There have been a number of incidents in recent times that will negatively impact how safe visitors feel here; namely the latest tourist bashing by bouncers in Patong and the riot at Thalang Police Station.

Though controversial, the riot should not really have much impact on tourism as it was far from the main tourist areas and was easily avoidable by those who needed to pass through the area at the time.

However, incidents involving nightclub bouncers in tourist areas are a different story, and could have negative repercussions, especially in Patong, where such force and aggression happens in plain view, for all tourists to see.

Bouncers and security guards are supposed to be making guests feel safe. Those who do not follow the club’s rules should first be warned of their behaviour and if they continue to act inappropriately, should then be evicted, but in a tactful manner.

This appears to be where the problem arises. Unfortunately, in some bouncers’ eyes, using relentless force and aggression is seen as appropriate and tactful.

What these bouncers, along with club owners, management and especially the Patong Entertainment Association should realise is that bouncers are also responsible for upholding the image of the club.

As “keepers of the peace” they should be patient and tactful and not hired simply because they look bad or are able to intimidate.

In the UK it is only possible to hire bouncers who have proper training and skills. In fact, they must hold a valid license from the Security Industry Authority, have valid references and no criminal history.

In Thailand, the criteria for hiring bouncers is apparently much less stringent; unlike in the UK, a police background check is not required and it is simply down to the business operator to conduct their own checks.

Whether this is actually done is anyone’s guess. However, having seen the footage of the latest attack, and considering previous similar incidents in Patong, one has to seriously wonder.

Perhaps it’s too far of a cry to expect Thailand to change its laws and requirements for screening bouncers any time soon, but one thing has become clear at this point: Patong’s entertainment venues – and all businesses for that matter – need to carefully consider who they allow to represent their image to the world.