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China Drives Tourism Across the Region

Dec 5, 2017 | Emerging Trends Advisors, Thailand

It perhaps comes as little surprise but the Asia Pacific region has the fastest growth rate in terms of tourist visitor arrivals in the world.

In a recent study conducted by Mastercard, it was revealed that the most popular destinations for an international overnight stay in the Asia Pacific region were Bangkok, Tokyo and Singapore.

In keeping with that trend, we have seen here in Thailand that the vast majority of the tourists come from mainland China and indeed Chinese nationals make just over 62 million outbound trips per year. These figures were compiled by the China National Tourism Administration rather than any outside party but it still confirms what most knew, China is the largest feeder market, not just within the region but the rest of the world.

The ever-growing Chinese tourist market is proving huge business for many countries. In Thailand, tourism currently makes up around 20% of the country’s GDP and this is expected to grow by a further 10% in 2017. In terms of the tourist arrivals from China, they currently make up 28% of the total visitor numbers, compared to 22% and 15% in Japan and Singapore respectively. It certainly appears that these Chinese guests are drawn towards Thailand and this trend is only expected to increase.

With the these predicted increases and the potential massive influx from India, a country that has a great deal of potential when it comes being a feeder market in terms of tourism, the tourist and hotel industries will be rubbing their hands. There is little surprise therefore that Thailand is seeing an increase in the number of hotels that are being constructed. This not only applies to Bangkok but also tourist hotspots such as Pattaya and Phuket.

When referring back to the information relating to Indian visitors, in 2016 Thailand welcomed 1.2 million Indian visitors compared to the 8.7 million coming from China. However, by Q2 in 2017, the number of Indian tourists had increased by 15% compared to the same period the previous year.

Of course, when you a receiving guests from different countries the hotels must conduct something of a balancing act. Keen to welcome everybody, it is important that hotels don’t become overly focused or overly dependent on one particular nationality. This is obviously because if a nation’s tourist start seeing Thailand as being less attractive, their potential client base could be irretrievably damaged.

An area that Thailand has been keen to concentrate on for a number of years is not only increasing the tourist numbers but also increasing the quality. This can prove challenging but if successful will be immensely beneficial.

In recent years we have seen tourist number increase from almost all regions of the world. Whilst on the face of it, this appears to be excellent news, it is important that the quality of the tourist is not compromised something which could negatively impact on future visitors.

Thailand and in particular cities such have Pattaya, have made great inroads into improving their reputation. It is therefore essential that an increase in tourist numbers doesn’t threaten the area’s infrastructure or cause excessive pollution.

Of course, in order to achieve this Thailand and indeed others in the region will focus on increasing spend per head. This is what will reap the greatest benefits in the long term and result in greater expenditure on infrastructure to ensure that future growth is sustainable.

The conclusion of all this, and something that many of the major hotel chains and developers have recognised is the need to ensure that they don’t “put all their eggs in one basket”. Whilst the Chinese market is rapidly expanding, it is important to diversify risk between different nationalities.

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