SEA Economy Case Study – Class B
Group Members:
Domenic Kortmann, Jenny Hert, Mariella Azizian, Nils Knickenberg, Gloria Neuwinger
Topic: Tourism Industry in Thailand
Introduction
Thailand is a wondrous kingdom, featuring Buddhist temples, exotic wildlife, and spectacular islands. Along with a fascinating history and a unique culture that includes delectable Thai food and massage, Thailand features a modern capital city, and friendly people who optimize Thailand’s “land of smiles” reputation. Thailand has rich sources for travelling and therefore deeply attracts people from all over the world. Each year, around 11 million visitors go there. Actually, tourism in Thailand plays an important role in the Thai economic structure and even in the whole Thai society, and it has a profound effect on Thai economy. This study concerns the background information of tourism in Thailand and will analysis certain problems that come along with it.
Tourism is becoming the pillar industry in Thailand. In the last 20 years, tourism in Thailand developed rapidly. According to a survey done by ESCAP,” domestic tourism was able to contribute 29695 million baht to GDP, which was 3.7 per cent of total GDP (Gross Domestic Product) in 1983.” According to another statistic, in 2009, tourism was contributing 14.7 % to Thai GDP. According to the government’s data, in 2010, Thailand attracted 15.8 million tourists, and it generated about 19 billion dollars of revenue. Sisdivachr Chevaratanaporn, the president of the Association of Thai Travel Agents, states:” The industry generates hundreds of billion baht in revenue”. Obviously, tourism is becoming a leading industry of Thai economy. The trend of this industry in Thailand is bright. The government and people both have an optimistic outlook on Thai tourism. In 2010, based on the statistic that 15.8 million visitors came to Thailand, Abhisit Vejjajiva, the former Prime Minister, makes a forecast:” The target of 19 million tourist arrivals this year will be hard to meet, though we should attract more than 18 million.” People in Thailand are strongly confident about this industry.
According to the research done by ESCAP, in 1985, the total demand for output induced gross foreign exchange from exports of 239.8 billion baht. The total net foreign exchange earnings ratio was 0.814. Also, the overall ratio for net foreign exchange earnings by the tourism sector was 0.8795, which is higher than any of the four industries or the total net foreign exchange earnings ratio. This date was from 1985, today, the ratio is even higher. As we know, industrial development need a lot of money as investment, this amount money lays a solid foundation for industrial development in Thailand.
In addition, tourism solves a lot of social problems in Thailand, and a stable social order is good for economic development. First of all, tourism promotes development of related industries. Tourism is not just people come to Thailand going sightseeing to those historical places and natural landscape; people need restaurants to eat, hotels to live in, vehicles to take, stores to shop. For example, hotels, according to Thai Hotels Association (THA), in 2011, the average hotel occupancy rate was at 59.21 per cent. And there are over 4,000 hotels in Thailand. These hotels bring great benefits to Thai economy.
Second, tourism offers a lot of jobs to people. According to the study from ESCAP, in 1985, tourism and it relative industry offered 14.6 million jobs in Thailand, which was 55 per cent of total jobs of 26.6 million.(ESCAP, 34) According to another study from the World Tourism Council, in 2009, tourism offered more than 4 million jobs, which was 11.1 per cent of total jobs. Unemployment is becoming one of the most serious issues of society, but when we looked at the WORLD FACTBOOK from CIA, in 2010, the unemployment rate of Thailand is 0.5 per cent; in 2011, it was 0.7 per cent. Compare to the United States (2010, 9.6% and 2011, 9.1%) and China (2010, 6.1% and 2011, 6.5%) tourism in Thailand does have positive effects of the society.
Everything in the world has its own two sides, and tourism in Thailand will be no exception. Besides those positive affects, tourism also has negatives in Thai society, such as education. Tourism workers don’t need a lot of knowledge, and most tourism workers are doing physical labor, for example, washing dishes in restaurants, cleaning the floor of hotels, selling goods to consumers. People can do those works even they don’t know how to read and write. Each year, even though about 700,000 graduate from Thai school, and only 70% go on further studies, the number is decreasing now. But the quality of education in Thailand is poor.
Tourism also leads to sexual negatives on society, such as prostitution and other kinds of sex industry. For example, AIDS is becoming one of the most serious issues in Thailand. In the end of 2009, there are 530,000 people who are living with HIV, and in 2009, 28,000 people died from AIDS. As we know, AIDS can be transmitted sexually. Controlling sex industry will be another mission for Thailand’s government.

Literature Review
The theories
Asian tourists primarily visit Thailand for Bangkok and the historical, natural, and cultural sights in its vicinity. Western tourists not only visit Bangkok and surroundings, but in addition many travel to the southern beaches and islands. The north is the chief destination for trekking and adventure travel with its diverse ethnic minority groups and forested mountains. The region hosting the fewest tourists is Isan in the northeast.
(Sex tourism also contributes to arrival numbers. Although officially illegal, prostitution in Thailand is monitored and regulated by the government to stem the spread of STDs and to prevent excesses. Prostitution catering to foreigners is believed to be around 20% of the total prostitution scene in Thailand, and is concentrated in a few major red-light districts such as Pattaya, Patpong, and Patong Beach)

Expert opinions
John Stapleton (Australian author: Thailand: Deadly Destination):

• Police corruption, violence and crime are all blighting a country once commonly referred to as the ‘Land of Smiles’.
• He also says that the death rate among tourists, which he claims often goes unrecorded, is ‘the worst scandal in the annals of modern tourism’
• Life in Thailand is cheap. And the deaths of foreigners often go unlamented; even unrecorded. Tourists are still given few warnings of the reality of the situation they are entering

Ministry of Foreign Affair: (Auswärtiges Amt )
• After the military coup in May´14 the secutiry is stabilized again
• Terrorism activities are available in tourism places
• Freedom of assembly and press freedom are restricted
• They advise to avoid the crowds and demonstrations
• The tourism suffers amongst the political unrest

Empirical studies

Some fact
Thailand has been receiving increased competition ever since Laos, Cambodia, and Vietnam opened up to international tourism in the 1980s and 1990s. Destinations like Angkor Wat, Luang Prabang, and Halong Bay now contest Thailand's former monopoly in the Indochina region. To counter this, Thailand is targeting niche markets such as golf holidays, or holidays combined with medical treatment (Medical tourism is a large and growing sector within Thailand's extensive tourism and healthcare industries. The country is extremely attractive to potential medical tourists and international patients for a number of important reasons: Thailand was the first Asian country to achieve Joint Commission International (JCI) accreditation in 2002. As of April 2014, 35 hospitals were JCI-accredited.; experienced, often Western-trained, medical professionals; the latest medical technology; and significantly lower costs of treatment when compared to corresponding procedures in the West. Taken together, all these factors—plus the country’s reputation as a popular tourist destination—have made Thailand one of the world's most popular medical tourism destinations.
Some of the primary destinations for medical tourism in Thailand are Bangkok, Chiang Mai, Hua Hin, Ko Samui, Pattaya/Chonburi, and Phuket.
(Foreigners seeking treatment for everything from open-heart surgery to gender reassignment have made Thailand the world's number one destination for medical tourism, luring as many as 1.8 million overseas visitors in 2013. That makes Thailand the go-to destination for international patients. In 2013, medical tourists pumped as much as US$4.7 billion into the Thai economy, according to government statistics. ) zu viel ?
-Thailand has also plans on becoming the hub for Buddhist tourism in the region.
-The Travel and Tourism Competitiveness Report 2015 published by the World Economic Forum ranked Thailand 35 of 141 nations. Among the metrics used to arrive at the rankings, Thailand scored high on "Natural Resources" (16 of 141 nations) and "Tourist Service Infrastructure" (21 of 141), but low on "Environmental Sustainability" (116 of 141) and "Safety and Security" (132 of 141).

History
Overview
Among the reasons for the increase in tourism in the 1960s were the stable political atmosphere and the development of Bangkok as a crossroads of international air transport. The hotel industry and retail industry both expanded rapidly due to tourist demand. During the Vietnam War, Thailand became a tourist hotspot for US soldiers and veterans. Concomitantly, international mass tourism sharply increased during the same period due to the rising standard of living, more people acquiring more free time, and improvements in technology making it possible to travel further, faster, cheaper and in greater numbers, epitomized by the Boeing 747 which first flew commercially in 1970. Thailand was one of the first players in Asia to capitalize on this then-new trend.
Tourist numbers have grown from 336,000 foreign visitors and 54,000 US soldiers on R&R (rest and recuperation used for the free time of a soldier in the US military) in 1967 to over 26 million international guests visiting Thailand in 2013. The average duration of their stay in 2007 was 9.19 days, generating an estimated 547 billion baht, around 11 billion Euros.
In 2014, 59% of visitors to Thailand came from East Asia, that is, the nine ASEAN nations plus China (Chinese visitors now account for 20% of all foreign travelers to Thailand), Hong Kong, Japan, Korea, and Taiwan. The largest numbers of Western tourists came from Russia (6.5%), the UK (3.7%), Australia (3.4%), and the US (3.1%). Around 55% of Thailand's tourists are return visitors. The peak period is during the Christmas and New Year holidays when Western tourists flee cold conditions at home.

Now
Tourism is a major economic factor in the Kingdom of Thailand. Estimates of tourism receipts directly contributing to the Thai GDP (Gross Domestic Product growth rate-(Bruttoinlandsprodukt Wachstumsrate) of 12 trillion baht range from 9% (1 trillion baht) (2013) to 16%.When including the indirect effects of tourism, it is said to account for 20.2% (2.4 trillion baht) of Thailand's GDP.

Analysis
SWOT Analysis
Strengths
One strength of Thailand is the sufficiency economy and development. The approach "suffiency economy" emphasizes moderation, appropriate technology, careful management of risk and flexibility in dealing with change. This is the way to reduce the impact of global volatility on its domestic development and to ensure that the rapid change within the Thai economy did not adversely impact the natural environment or deprive the rural poor of an acceptable quality of life.
The agricultural sector is also an big advantage of the country. With more than half of Thailand’s population involved in agriculture, this sector has been of particular importance to natural development.
Another strength is the superior service especially in spa, restaurant (also global food), health related services and entertainment. Thailand also has good quality products, skilled labor and is very innovative and creative.
All in all Thailand has or moreover is the brand "thai". Everybody knows Thailand and most of the people associate something postive and good with it. Weaknesses
A disadvantage of the thailand tourism is the lack of language competence of the locals. Also there is no sufficient capital and it is very hard to get access to financial sources. Also there is a lack of interest and/or capital to acquire new technologies e.g. automate machines.
Moreover there is a lack of opportunity and/or interest in live long learning, training on new skills and in entrepreneurship. Last but not least Thailand people have mostly a low level of knowledge and appreciation of other countries culture, social life and business practices.
Poor transport infrastructure is one of the key barriers to the development of domestic tourism in Thailand. A lack of proper road networks to rural tourist destinations, a lack of proper accommodation facilities, poor timekeeping among airlines and weak communication facilities are some of the main factors. Opportunities
One big opportunity was already mentioned in the “strengths-section” of the SWOT Analysis, which is the brand “thai”. The thai taste is known and appreciated by others. This attracts a lot of customers and the country could even get more profit out of this circumstance. The customers are coming to Thailand to use thai services and products. Another opportunity are the declining travelling prices, for example from Thai Lion Air.
All in all the tourism industry in Thailand is highly advanced and sophisticated. Much of the bookings in restaurants, hotels, flights, car rentals in the country are done online through travel portals. Several international players in the online travel industry such as Agoda, Expedia have expanded their business in Thailand forming business partnerships with young local Thai business partners. Thailand for them represents a great opportunity to make massive profits. Threats
One threat of are the high production costs in Thailand, which also influences the prices of the tourism sector. This makes it less competitive. Although there’s an increase of cheaper goods.
A major point of the threats is the political disability in comparison to western countries.
Analysis in general
The travel and tourism sector in Thailand, which declined slightly in 2009, performed well during the last periods. The country recorded an increase in number of visitors, both domestic and international, as well as an increase in expenditure by tourists. Economic growth and promotional activities by the tourism authority supported this growth.
Although the government has been making continuous efforts to promote tourism. According to the World Economic Forum’s Travel and Tourism Competitiveness Index for 2013, Thailand ranks 11th out of 140 countries in terms of destination marketing. The Tourism Authority of Thailand (TAT) has launched several campaigns such as ‘Amazing Thailand’, ‘Beautiful Thailand’ and ‘Unseen in Thailand’ to attract domestic and international tourists, with a particular focus on tourists from China, Russia and India.
Thailand is considered an attractive tourism destination, renowned for its culture, history and leisure and entertainment facilities, as well as its beach and island resorts. Thailand caters to a range of tourists, from high-end luxury travelers to backpackers. In addition to its various attractions, Thailand is widely regarded as a value-for-money destination. Online travel information portals and booking systems are emerging and their development will help to improve tourist inflows.
The key barriers for Thai outbound tourism to non-Asian countries are a lack of sufficient financial resources and expensive tour packages. The cost of air travel is the largest financial barrier for foreign destinations such as Europe and the US and it represents a majority of the overall cost of outbound travel. The cost of accommodation in Western and American countries is also high and relatively unaffordable.
The Thai aviation market faced many challenges during the review period. Increasing fuel prices, the emergence of low-cost carriers, regulatory changes and enhanced security procedures have required leading companies to change their market strategies. The global financial crisis was also a challenge for the market, affecting both passenger volumes and profitability.
Domestic travelers primarily book tickets through travel agents or online travel sites. Direct booking channels are becoming more prominent due to efforts by airlines to lower distribution costs. The growing e-commerce sector is making it essential for travel agents and tour operators to adopt self-booking tools to remain competitive. Tour operators generally sell their products and services through travel agents. Despite the growth in online travel bookings, senior citizens and those in the lower income groups still continue to book trips through traditional channels.
In a nutshell the tourism in Thailand is a big opportunity for the country to gain profit. The problems the sector is facing are not overweighting the advantages and positive aspects of the Thailand. In our opinion there will be a positive development of this sector within the following years.
Conclusion
Tourism is a positive word with lots of consequences. The consequences of tourism are economic, social, cultural and environmental. In the case of each they bring positive and negative effects to Thailand. The positive impact is obvious money and income for both, the government and locals.
It is to mention that the Tourism in Thailand is helping to support the communities, particularly in rural areas. Furthermore an improved infrastructure power, water, and telecommunications, services (banks, transport) and new investments, all serve to enhance the lifestyles of communities in this Country.
Besides Economic aspects the tourism is also developing positive attitudes towards each other culture and learning about each other's culture and customs. It reduces negative perceptions and stereotypes which foreigners have about Thailand. Additionally, it can also develop friendships, pride, appreciation, understanding, respect, and tolerance for each other's culture. Finally, Tourism is increasing self-esteem of hosts and tourists.
Nonetheless the tourism at all does not have just positive effects. Overall Tourism has a heavy impact on the environment and a huge number of tourists can exploit natural resources trough mass tourism.
Thailand needs more infrastructures, transportation and other facilities for its tourism which causes environmental suffering. In addition the tourism also caused environmental pollution from human waste, sewerage into water sources, and trash.
Even though the Tourism offers a lot of jobs to people, many jobs are poorly paid. Tourism also leads to sexual negatives on society which made AIDS of one of the most serious issues in Thailand.
Some rituals, ceremonies and cultural events have become commercialized and have turned into a kind of show business where the focus is making money; this is perceived by some as being caused, or partially caused, by tourism.
Thailand has devised a tourism marketing approach which encourages low-, medium-, and high-cost mass tourism to nearly all regions of the country.

Nonetheless, the explosion of tourism has brought uneven distribution of financial benefits, in favor of large enterprises, while costs are shouldered by local people who have no direct gain from tourist promotion. This is followed by the environmental effects of unbridled tourism development. While the Thai tourism industry touts and actively markets the country's unique cultures, this commercialization of culture also causes its erosion or corruption.
Since Thailand's economy was devastated by the Asian Financial Crisis, it has bounced back strongly, in line with regional trends. While Thailand's economy will continue to be undermined by political volatility, it will not be completely hindered by it, and will continue to see growth in the tourism sectors over the coming years.

Quellenverzeichnis: http://www.theguardian.com/travel/2006/jan/15/travelnews.thailand.theobserver https://en.wikipedia.org/wiki/Tourism_in_Thailand http://www.bangkok.diplo.de/Vertretung/bangkok/de/09/25-Tourismus.html http://www.auswaertiges-amt.de/DE/Aussenpolitik/Laender/Laenderinfos/01- Nodes_Uebersichtsseiten/Thailand_node.html
https://books.google.de/books?id=VIDZBQAAQBAJ&pg=PA355&lpg=PA355&dq=expert+opinions+tailand+tourism&source=bl&ots=QI7YwNrnJH&sig=fmoc_aULIYDDyNVYfzeX8JiuHM4&hl=de&sa=X&ved=0CDkQ6AEwA2oVChMIrbX-9sC8yAIVkZ6OCh1iiAVf#v=onepage&q=expert%20opinions%20thailand%20tourism&f=false