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Southeast Asia’s tourism-reliant economies are holding out hope that they can welcome back droves of international travelers by the final quarter of this year, a plan that looks increasingly dubious amid worst-yet Covid-19 waves and glacial vaccination campaigns. Â
Cambodia’s Ministry of Tourism released a video this week saying it aims to reopen its tourism sector by the last quarter of this year, while so-called “sandbox†plans in Thailand would see the resort island of Phuket be the first place to reopen in July.
Thailand hopes to follow the success of that plan for a phased reopening of 10 other destinations in October, with the government recently saying that it expects 500,000 foreign visitors this year.Â
Vietnamese authorities were also planning to resume international tourism between July to September, focusing first on resorts around the central beach town of Danang before a full reopening in the last quarter of 2021.
Thailand welcomed around 40 million visitors in 2019, generating US$60 billion in revenue, representing nearly one-fifth of the kingdom’s gross domestic product (GDP).
For Cambodia, tourism contributed nearly a third of GDP that same year. Vietnam’s 18 million foreign visitors generated revenues of $32.8 billion in 2019.Â
But the Covid-19 pandemic has decimated tourism across Southeast Asia, leading to a surge in joblessness and business defaults, not to mention a big shortfall in foreign currency earnings for their governments.Â
Cambodia welcomed only 71,000 tourists in the first quarter of this year, down almost 94% from the same period in 2020. Almost half were from neighboring Thailand.Â
According to the World Tourism Organization (WTO), international traveler numbers fell by 74% in 2020 compared with the previous year, cutting almost $1.3 trillion from 2019 international tourism market revenues.
Governments are weighing how best to kickstart their dormant tourism sectors in anticipation that a majority of Chinese, Americans and Europeans will be vaccinated by the second half of 2021.Â
Thailand and Vietnam seek to drop quarantine requirements for certain locations where tourists will have to show they are vaccinated against Covid-19. Cambodia will likely test a similar scheme with localized trials before reopening the entire country. Â
Thailand’s Tourism and Sports Minister Phiphat Ratchakitprakarn is now reportedly waiting for local infection rates to fall before resuming travel bubble discussions with Singapore, Hong Kong, Vietnam, Laos, and Malaysia.
In early May, Phiphat stated that “daily infections should be below 200 by the end of this month to restore international tourism confidence.†Thailand’s daily infection rate average is now well over 10 times that figure amid the kingdom’s worst Covid wave yet.
Cambodia’s new daily cases numbers have declined since a peak of 938 on May 4, but the seven-day average was 432 as of May 23. A new wave in Vietnam beginning in early May has seen daily infection rates climb above 100, despite it having some of the most stringent Covid-19 restrictions in the world.Â
Even without the latest surge in coronavirus cases, experts and analysts didn’t expect tourism to return to pre-pandemic levels any time soon.
Indeed, Thailand’s National Economic and Social Development Council said in a report released on Monday that it doesn’t expect the kingdom’s tourism sector to recover fully until 2026.
That long wait, which some analysts had earlier predicted would fully recover in two years, will impact more than seven million workers, some of whom may need to find jobs in other fields, the NESDC said.
There are also growing worries, expressed by the Bank of Thailand and independent analysts, that non-performing hotels, resorts and other tourism-related businesses will start to infect the country’s wider financial health.
Some commentators have argued that Southeast Asian states should leverage the pandemic’s closed borders as an opportunity to reset their tourism sectors, shifting away from mass tourism towards more sustainable, higher-end travel.Â
So far, though, it seems regional governments are eager to restart their tourism sectors as they were pre-pandemic, welcoming as many guests as possible. That open-door policy had positive knock-on economic effects, ranging from services to construction to education. It also provided for millions of jobs and local-level entrepreneurial opportunities.
Of the $25.5 billion worth of approved investment projects listed by Cambodia’s central bank between 2017 and 2020, $14.4bn went to the tourism sector, a vastly higher percentage than for any other sector.Â
Government-approved investments last year in Cambodia’s industries sector were spread over 130 projects with fixed assets of just over $1 billion. But six tourism projects also approved last year had assets worth $3.8 billion, much of which will go to a planned expansion of Phnom Penh’s sole casino operator, Naga Corp.Â
Southeast Asian tourism stakeholders are also wondering whether, once international travel can resume in larger numbers, Chinese tourists will travel on the same mass scale as they did pre-coronavirus.Â
Around 28% of all visitors to Thailand in 2019 were Chinese, while nearly half of all travelers to Cambodia were.  Â
The pandemic and travel bans have driven a considerable expansion of domestic tourism within China. Chinese-owned Trip.com Group, one of the world’s largest online travel agencies, estimates that rural trips within China increased 300% between March 2020 and March 2021, compared with the same period a year earlier. Â
China’s Ministry of Culture and Tourism reckons there will be more than four billion trips made across China in 2021.
It waits to be seen if the surge in domestic tourism in China is artificial, prompted by outbound travel restrictions because of the pandemic, or a long-term trend that will see greater numbers of Chinese tourists vacation at home rather than in places like Thailand and Cambodia.
A less discussed factor is competition between Southeast Asian states over how quickly they can reopen their doors to international tourists, in the hope that it can give their economies a much-needed kickstart.
Much of this will depend on how quickly populations can be vaccinated against the coronavirus, a race which at the moment Cambodia is well in the lead.Â
As of May 23, 13.5% of Cambodians had received at least one dose of a vaccine, above the world average and the second-highest in Southeast Asia just behind Singapore. Thailand has vaccinated just 2.7% of its population, and Vietnam barely over 1%.Â
The US Centers for Disease Control’s advisory this week against travel to Japan because of its likewise laggard progress in vaccinations should sound a warning to comparatively tourism-dependent Southeast Asia to pick up the pace.
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