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Boutique Hotels in Phuket Struggling Despite the Rise in Tourists

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Boutique Hotels in Phuket Struggling Despite Rise in Tourists

Although tourists are returning to Phuket, Thailand in greater numbers than in other provinces, many of the resort island’s boutique hotels have yet to benefit from the tourism sector’s recovery.

One of the most difficult challenges these hotels face is a lack of funds to renovate or repair their properties, which have been vacant for the majority of the past three years due to the COVID-19 pandemic, and banks are hesitant to approve new borrowing until they repay their old loans.

According to Pimpisaporn Techauppathamkul, vice president of the Phuket Boutique Accommodation Consortium, approximately half of the consortium’s 400 small hotel members have folded and their properties have been seized by their creditors, while some other hotels are fighting their cases in court.

She stated that small hotels have received little assistance from the state because many of them operate without a license due to environmental laws that make it difficult to obtain one.

Pimpisaporn also mentioned that there are differences between the various nationalities of foreign tourists. For example, she stated that tourists from some European countries will avoid those from Russia because they oppose the war in Ukraine, and Russian tourists themselves are having currency problems.

According to Dr. Kosol Taenguthai, a former mayor of Phuket, tourists from Russia, India, Malaysia, Singapore, and some European and Middle Eastern countries are now replacing Chinese tourists, who have yet to return to Phuket in the numbers seen before the pandemic due to the Chinese government’s strict travel controls.

He noted that, following the designation of COVID-19 as a “disease under watch,” Phuket experienced several rounds of flooding, particularly in the Patong area.

During the pandemic, he claimed that almost nothing was done to improve Phuket’s infrastructure, such as the Patong tunnel, which, when completed, will help reduce travel times to and from the Patong area.

The project’s cost was estimated to be around 7 billion baht in 2016, but this has now risen to nearly 20 billion due to a sharp increase in construction material prices. The project is still unfinished.

Other projects, such as the Wellness Centre for the Elderly and the Expo Special 2028, have yet to begin, according to Dr. Kosol.

She stated that the organization has frequently petitioned the authorities to relax some of the restrictions, but to no avail.

According to the Tourism Authority Office in Phuket, tourism in the island province increased by 80% year on year from January to October, with nearly 100 billion baht now circulating in the economy.

Tourism generated 119 billion baht in revenue during this time period, with hotel occupancy rates averaging 35%.

Phuket has received 6.2 million visitors in the last ten months, representing a 41% increase in Thai tourists over the same period in 2021.

From May 1 to November 27, 934,164 tourists visited the island, according to Pol Gen Thanet Sukchai, commander of the Phuket Immigration Bureau (IB). There were 914,746 foreign nationals.

From November 1 to November 27, the majority of visitors came from Russia, India, Australia, the United Kingdom, and Germany, in that order.

According to the data, the hotel occupancy rate averaged 35% from January to October, implying that nearly 100,000 hotel rooms were booked during this time period.

Nanthasiri Ronnasiri, director of the Tourism Authority Office, said yesterday that the increase in numbers demonstrated how tourism is gradually recovering after three years of recovery from the Covid-19 pandemic.

She added that this can be interpreted as a partial indicator of the country’s improving economy.

Ms Nanthasiri stated that the tourism industry’s labour shortage is a challenge for many operators who are still recovering from the pandemic.

However, Thaneth Tantipiriyakij, president of the Phuket Tourist Association (PTA), believes that high airfares will stymie the recovery’s progress. Several factors, including energy inflation, have weighed on prices.

A one-way flight from Bangkok to Phuket can now cost as much as 6,000-7,000 baht, which is significantly higher than the highest one-way airfare for this route in 2019 prior to the pandemic, which was 3,000-4,000 baht.

According to Mr Thaneth, most domestic flights are fully booked due to high demand, as airlines struggled to return to pre-Covid levels.

“The air-ticket pricing problem is caused by a supply and demand imbalance,” Thaneth explained.

The PTA intends to petition Prime Minister Prayut Chan-o-cha, the Tourism and Sports Ministry, and the Transport Ministry, as well as consult with them on how to increase the number of flights.

Phuket International Airport can accommodate up to 480 flights per day. Prior to November, it received about 100 flights per day, but on Monday, the number of arriving flights increased to 200 per day.

On December 10, Phuket International Airport set a new post-pandemic record for international arrivals, while the country celebrated 10 million visitors for the year.

Governor Narong Woonciew was present at Phuket airport on December 10 to greet foreign tourists arriving on the day Thailand recorded 10 million foreign visitors for the second time.

On December 10, celebrations to welcome foreign visitors were held at seven airports and two immigration checkpoints as the country recorded 10 million foreign tourist arrivals beginning January 1, 2022.

On December 9, Phuket International Airport recorded 10,900 foreign arrivals, the most since March 2020, when Thailand closed to international travellers due to the COVID-19 pandemic.

Flights to Phuket Double in Price As Tourism Jumps 80 Percent

Flights to Phuket Double in Price As Tourism Jumps 80 Percent

 

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