Economic Impact of Tourism in Thailand

     In Southeast Asia, there is a small but amazing country; it only has 600 million populations and 513120 km2 area.[1] Thailand has rich sources for travelling: mysterious temples, beautiful islands, nice beaches, delicious foods, marvelous cultural, all those elements deeply attract people from all over the world. Each year, around 11 million visitors [2]go there. Actually, tourism in Thailand plays an important role in the Thai economic structure even in the whole society, and it has a profound effect on Thai economy. In this essay, I’m going to talk about some background of tourism in Thailand, and I will try to figure out how does tourism impact the economy of Thailand.

     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[3],” 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.”[4] According to another statistic, in 2009, tourism was contributing 14.7 %[5]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.[6]Sisdivachr Chevaratanaporn, the president of the Association of Thai Travel Agents, states:” The industry generates hundreds of billion baht in revenue”.[7]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.”[8] People in Thailand are strongly confident about this industry.

     The path of development is not even. In recent years, Thailand’s tourism industry takes a lot of damage from several blasts. In 2004, more than 8000 people died in the Indian Ocean tsunami; in 2008, many anti-government demonstrations came out, and it lead to the Bangkok’s international airport shutting down for two weeks; in 2011, Thailand suffered from the nation’s worst floods in the last 50 years, and this disaster deeply devastated Thai manufacturing industry and agriculture.

     Thailand really takes the efficient steps to respond to those disasters. Heinecke, a hotel-holder, claims:” you mustn’t underestimates the ability of Thailand to respond very quickly to these types of events as they’ve shown in the past.”[9] That shows people in Thailand really care about tourism.

     Recently, some experts in Thailand claim that industry is the foundation of a country; Thailand should develop industry instead of tourism. Actually, tourism brings a lot of foreign exchange to Thailand, and this money is the foundation of development of 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 ration 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. [10]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[11] per cent. And there are over 4,000[12] hotels in Thailand. These hotels bring great benefits to Thai economy. Also, shopping in Thailand is also prosperous. Siam Paragon is the 10th biggest shopping mall in the world. Siam Paragon is in Bangkok, it has 3.22 million sq ft.[13] Government takes 7% value added tax from goods. Shopping also 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%)[14] tourism in Thailand does have positive effects of the society. Furthermore, Thailand government forecasts that by 2019, one job in every 8.3 jobs in Thailand will be related to tourism. (Thephuketinside)

     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,[15] the number is decreasing now. But the quality of education in Thailand is poor. Sumate Yamnoon, who is from Higher Education Commission Secretary-general, claims:” Our process to screen students for higher education is problematic”.[16]He believes that even though the number of offers has been increased from 235 to over 2,000 each year, but the number of lectures stays the same. All those shows Thailand’s government is paying less attention to education and poor education has long-term negative impact on a country.

     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.[17] As we know, AIDS can be transmitted sexually. Controlling sex industry will be another mission for Thailand’s government.

     In my opinion, a country should focus on sustainable development not just present interests. I think that even though tourism plays an important role in Thai economy, meanwhile, Thailand’s government should also develop other industries, for example, high-tech industry. Moreover, more students should learn basic science, such as engineering, physics, chemistry and biology.

     In conclusion, tourism plays an irreplaceable part of Thai economy through making a lot of foreign exchange to Thailand and offering jobs to people; in the mean time, Thailand’s government should pay more attention to education and other industry. In addition, many negatives, such as prostitution should not be neglected.

Word Count: 1370


[2] “Royal Thai Consulate-General”, http://www.mfa.go.th/web/1839.php?id=17061, accessed 10 March, 2012

[3] Economic and Social Commission for Asia and the Pacific

[4] “The economic impact of tourism in Thailand” Economic and Social Commission for Asia and the Pacific (1991): 26

[5] “Tourism Impact on Thatland’s Economy by the Numbers” Thephuketinside, 23 June 2009, http://www.thephuketinsider.com/tourism/tourism_impact_on_thailands_economy_by_numbers.php, accessed 18 Feb, 2012

[6] Suttinee Yuvejwattana, “Thai Tourism Industry Spared From Floods, May Support Growth.” Businessweek, October 14, 2011, http://www.businessweek.com/news/2011-10-14/thai-tourism-industry-spared-from-floods-may-support-growth.html, accessed 10 March, 2012

[7] Yuvejwattana

[8] Yuvejwattana

[9] Yuvejwattana

[10] ESCAP, 38

[11] The Nation, “Average Occupancy Rate Only 59.21% in 2011”, http://www.nationmultimedia.com/business/Average-occupancy-rate-only-59-21-in-2011-30174795.html, accessed on 18 March, 2012

[12] Agoda, http://www.agoda.com/asia/thailand.html, accessed 14 March, 2012

[13] Robin, “10 Largest Malls in the World”, http://www.touropia.com/largest-malls-in-the-world/, accessed on 12 March, 2012

[14] CIA, “the world fact book”, https://www.cia.gov/library/publications/the-world-factbook/fields/2129.html, accessed on 17 March, 2012

[15] “ Thailand: Two million students, but quality poor”, University World News, 03 August, 2008, 39

[16] Two million students, but quality poor

[17] HIV & AIDS in Thailand, http://www.avert.org/thailand-aids-hiv.htm#contentTable1, accessed on 12 March, 2012

2 Responses to Economic Impact of Tourism in Thailand

  1. Pingback: Tourism in Thailand | Tourism in Thailand

  2. 2012alex says:

    Your blog entry is not properly formatted; you should have separated your sections with subtitles. Your introduction is very short but it does make a connection to the broad topic. Your thesis is not strong. Remember we talked about NOT starting a thesis statement with “In this essay . . . .” The body of your essay provides relevant statistics which are properly cited. When you talk about currency (money) you should always convert it to a currency that your audience is familiar with. In this case, baht should be converted to Canadian dollars. Be careful to paraphrase adequately. The phrase “Thailand suffered from the nation’s worst floods in the last 50 years, and this disaster deeply devastated Thai manufacturing industry and agriculture” does not read to me like your own words. You effectively integrate quotes into your text. The positive and negative effects of tourism were well organized and clearly stated with research to support your statements. Your conclusion is VERY short; you do summarise your main ponts briefly but you do not leave the reader with any final thoughts.

    Most of your blog consisted of decorative images, which you cited correctly. You did, however, include a video. If you are going to insert content media you should refer to it in your text; it should contribute to the written content of your blog.

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