Thailand throws US$718m into domestic tourism push

Grand Palace Bangkok, Thailand

The Thai government has approved a 22.4 billion baht (US$718 million) domestic tourism stimulus, as part of efforts to soften the impact of the pandemic and speed up recovery in the travel and tourism sector.

The stimulus package was proposed by the Ministry of Tourism and Sports and the Ministry of Finance (MOF), and comprises three packages geared toward frontline personnel, hotel stayers and those using domestic transportation to travel.

Thailand’s government turns to domestic tourism to make up for the losses in international tourism receipts

To date, no concrete plans have been drawn up as to when international tourists will be allowed back into Thailand – a situation that has frustrated local DMC chiefs. With hints that travel bubbles may not be implemented by July, it appears the Thai government has put foreign arrivals on the backburner, instead turning its focus on reviving domestic tourism with three incentive packages running from July through October of this year.

The Moral Support package worth 2.4 billion baht will fund the holiday travels of 1.2 million frontline medical personnel, public health volunteers and officials of sub-district hospitals. The subsidy is capped at 2,000 baht per tourist for a minimum 2 days and 1 night of travel booked through participating agents.

All other Thai nationals aged 20 and above will be eligible for the 18 billion baht Travelling Together package, where the government will fund 40 per cent of overnight stay rates at participating hotels, capped at 3,000 baht per night for no more than five nights. The subsidy will apply for the first five million eligible nights of stays booked outside travellers’ home provinces. The package also includes subsidies, capped at 600 baht per room, per night for other services, including related F&B businesses.

Another two billion baht has been allocated for the third package, Happiness-sharing Trips, to subsidise domestic flight fares, inter-provincial bus fares and car rental fees for two million individuals. The subsidy will cover 40 per cent of expenses, but is capped at 1,000 baht per tourist.

The package is expected to stimulate 100 million domestic trips and benefit 36,755 F&B operations and 24,700 participating accommodations in the hospitality industry.

With this scheme, the government hopes to incentivise Thais who would otherwise have travelled abroad to opt for local adventures instead, and that domestic receipts could make up for losses in inbound tourism.

An MOF source told the Bangkok Post that Thais spent 400 billion baht travelling abroad in 2019 – and the government hopes to capture 75 per cent of that sum in domestic receipts this year.

In 2019, Thailand got 18 per cent of its GDP from tourism, and domestic travel spend made up about six per cent of that total, approximately one trillion (out of three trillion) baht of tourism income.

The government hopes to earn at least 900 billion baht from domestic travel this year, which would nearly rival 2019’s tourism revenue of 1.28 trillion baht generated by Thailand’s primary cities.

Hotels wanting to join the programme can register with state-owned Krung Thai Bank, while eligible travellers can sign up via the Krungthai Bank (KTB) app to obtain the e-vouchers. Last year, the Thai government also issued a domestic tourism subsidy via the KTB’s app, which proved so popular that the app crashed within hours of its debut.

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