Thailand will need months to repair damage to its lucrative tourism industry wrought by the deadly tsunami that swept across the Indian Ocean, a senior tourism official said on Tuesday.
Tourism accounts for 6 percent of Thailand’s gross domestic product and the tsunami, which has killed more than 1,000 people in Thailand and more than 28,400 in Asia, has hit tourism-related stocks and rattled the Thai baht.
“In three months, we should rebuild 70 percent of the damage in the three worst hit provinces,” Tourism Authority of Thailand governor Juthamas Siriwan told reporters, referring to Phuket, Pang-Nga and Krabi.
“But this is just an preliminary estimate and we are not sure if we will make it.”
The authority is preparing plans to repair the damage and is seeking to determine whether Thailand’s target of 13.4 million tourists next year is still viable.
Prime Minster Thaksin Shinawatra estimated the cost of the damage at 20 billion baht ($510 million) and the government would seek additional funds from parliament.
But analysts said they expected far more losses for the tourism industry, which is expected to earn nearly 400 billion baht and attract 12 million foreigners this year.
“We estimate losses in terms of future tourist revenue foregone along with fisheries and property damages to be about 35-40 billion baht, or 0.5-0.6 percent of our projected 2005 GDP,” Phatra Securities said in a research note.
Phuket, Pang-Nga and Krabi earn about 100 billion baht from tourism per year, according to the brokerage. Phuket island, the hardest hit, earns 73 billion baht from nearly 4 million visitors annually, 71 percent of them foreign, it said.
The tsunami sparked a spate of cancellations of hotel bookings and travel packages, operators said.
Sahid Ali, marketing manager of Sheraton Grand Laguna Beach Resort in Phuket, said he did not have exact figures but that overseas people were cancelling plans to come to Phuket.
Royal Garden Resort said on Tuesday its 40 percent-owned Anantara COCO Palm Resort and Spa in Phang-Nga’s Khao Lak, was destroyed, sending its stock to a one-month low.
Laguna Resorts and Hotels PCL said 50 rooms out of the 900 at its Laguna Phuket resort were damaged.
Thai Airways, whose stock hit a three-week low on Tuesday, reported only limited loss of business. “There are some cancellations but not much,” an official said.
BankThai economist Anusorn Tammajai said the impact would not be prolonged. “It will have a severe impact on tourism, but it is a one-off impact, unlike SARS or unrest in the south.”
Last year’s outbreak of Severe Acute Respiratory Syndrome (SARS) prompted a 7.4 percent decline in the number of tourists to 10 million. The industry has also been hurt by political unrest in the south of the country.
On average, foreign tourists spend 4,000 baht a day and stay for eight days. Thailand had 6.95 million tourists in 1995.
While the main resort stocks notched up declines of around one percent, the Thai baht stabilised on Tuesday after shedding about 0.25 percent on Monday.