The U.S. embassy put out word over the weekend that aircraft carrier USS Abraham Lincoln and destroyer USS Russell were set to arrive at Laem Chabang port, near Pattaya, for a four-day “rest and relaxation” visit sometime this month. No date was specified, but now embassy sources say the visit may not happen due to Monday’s declaration of a state of emergency in Bangkok and spreading strikes by transportation and utility unions across the nation.
Cancellation would deal a huge blow to Pattaya’s local economy. With more than 6,000 sailors, marines and aviators on the two vessels, spending by U.S. military forces could easily approach 200 million baht for the four-day visit. Bar and restaurant owners ravaged by this year’s low season say the port call could carry them for all of September, traditionally the slowest month of the year.
‘Wait and See’
Wednesday marks a week since the PAD, a right-wing group of businessmen and monarchists that, contrary to its name, have little interest in democratic rule, took over Government House by force seeking to overthrow the administration of Prime Minister Samak Sundaravej. In the past week, the group’s supporters shut down major arteries into the capital, three sourthern airports and have persuaded unions to strike in support of their cause. After pro- and anti-government clashed violently Monday, Samak declared a temporary state of emergency, which allows the military to back up police to restore order.
As I predicted in a July 31 article, blood on the streets in Bangkok is starting to have major impact on Pattaya. The escalating crisis has prompted travel warnings from countries around the world, a drop in both the Thai stock exchange and the baht and, now, has begun to hit the country’s vital tourism industry.
- The Phuket Gazette reported Tuesday that half of the Japanese tourists who planned to visit the island over the next week have canceled their bookings due to the unrest.
- The Thai Hotels Association in Chang Mai said 15 percent of the hotel bookings and tour packages in that city have been canceled in the past week. Tour businesses there called an emergency meeting Tuesday, expecting even a greater drop in tourists.
- The governments of South Korea and Singapore both warned their citizens to postpone non-essential travel to Thailand. Travelers from Australia and New Zealand have been urged to show “a high degree of caution,” while the governments of the U.K., Canada and Japan have also issued travel advice warning visitors to exercise caution. The U.S. has similarly warned visitors to avoid travel in Bangkok and assemblages of large groups anywhere.
“It’s getting worse. Nobody will enjoy traveling with the state of emergency in place,” Maiyarat Peerayanakoses, president of the Association of Domestic Travel, told the Reuters news service. “Not only foreigners, Thai people also want to stay in a safe place,” she said, adding that 90 percent of domestic tours had been cancelled in recent weeks due to the political unrest.
Tourism Officials React
Seeing Thailand’s golden goose about to get slaughtered, the Tourism Authority of Thailand Tuesday called its executive directors to an urgent meeting with the private sector Monday to lay out a strategy for protecting the country’s tourism industry in the face of the protests.
Apichart Sankary, president of the Association of Thai Travel Agents, was worried tourists would turn away from the “Land of Smiles” during the high travel season starting in October.
“Tour bookings from foreign tourists, mainly from Europe, for the high season have already dropped more than 10 percent from the same period a year ago,” Apichart said. “The large number of Chinese tourists we had expected to come after the Olympics are not showing up. If the turmoil drags beyond this month, our industry will be badly hit.”
He also repeated calls on the PAD to settle its differences before tourism is damaged further.
”I want to send this message to the PAD protesters, especially those in southern provinces, that closing airports will affect not only businesses in the provinces but also others, as the industry involves many sectors including the agricultural and food sectors,” he said in the Bangkok Post.
According to Mr Apichart, the protests have already scared away Asians who are more sensitive than Westerners about security issues. They could hurt the European market as well if the protests continue to the middle of this month. He said the Thai tourism industry was likely to lose revenue during the five-month high season (October to February) if the protests were prolonged.
It’s not just the tourism industry that’s starting to feel the pinch, however. The financial sector is also being battered.
- The Bank of Thailand intervened in the foreign-exchange market Monday to support the baht after the government declared emergency rule in the capital. The baht fell to 34.47 to the dollar on Tuesday morning.
- Ratings agencies Standard & Poor’s and Moody’s Investors Service both issued statements Monday warning that rising political tension could undermine Thailand’s current investment-grade credit ratings.
- Two companies - the mobile phone retailer Jay Mart and building materials distributor Siam Global House - said they would delay plans to list on the Stock Exchange of Thailand this year due to political uncertainties and market volatility.
- Bangkok Bank, Krung Thai Bank and Siam Commercial Bank closed more than 20 branches in Bangkok around Ratchadamnoen Road for fear of violence in the area. The PAD has threatened to try to create a run on banks by having its monied supporters withdraw their savings from financial institutions.
“We have no concrete solution to end the political turmoil as we’re not political experts,” Thai Bankers’ Association chairman Apisak Tantivorawong told The Nation newspaper. “We agree that all parties have the freedom to take action, but they should not take the economy hostage.”
“A state of emergency is just the contrary of stability and predictability and a lot of uncertainty is around,” Nandor von der Luehe, chairman of the Joint Foreign Chambers of Commerce in Thailand, which represents 10,000 foreign companies, told Reuters. “For new investors who have to make a decision whether to invest in Thailand or one of the competing economies, a state of emergency declaration will be for sure a big hurdle to convince them that Thailand is stable and worthwhile to invest in.”Ghostly Topics: Politics, Tourism, U.S. Navy