Airport drama has no happy ending for Thai tourism

By Ed Cropley

BANGKOK (Reuters) - From empty sun loungers at luxury hotels to vacant bar stools in dingy fleshpots, tourism in Thailand is going through its worst slump in decades, a result of the global economic slowdown and its own political turmoil.

"Right now, business is so slow. Some nights, only one customer," said Jodie, a 24-year-old transvestite go-go dancer teetering round the capital's Nana red light district in spike-heeled thigh-high boots.

Her gloom is echoed by everybody in an industry that accounts for six percent of the economy in the self-styled "Land of Smiles," and which directly employs 1.8 million people -- around the same proportion of the eligible labor force in Thailand.

Tourism Authority of Thailand (TAT) boss Phornsiri Manoharn estimates the 8-day closure of Bangkok's $4 billion Suvarnabhumi airport by anti-government protesters a month ago will have caused one million foreign visitors to cancel or go elsewhere.

"This is the hardest hit we've ever encountered in the 48 years we've been promoting tourism to Thailand," she told Reuters, saying the airport shutdown put the December 2004 tsunami, bird flu and SARS in the shade.

With arrivals numbers for the key holiday month of December likely to be 500,000 -- a third of forecasts -- the TAT's ambitions of attracting 15.5 million tourists in the whole of 2008 and 16 million in 2009 are lying in tatters.

Far from enjoying the 70 percent occupancy they normally see in December, Bangkok's top hotels are 25 percent full, forcing management to close floors, lay off contractors and ask staff to take unpaid leave.

At the height of the airport blockade, one luxury hotel was rumored to have had just one room occupied.

"It would be fair to say that this will be the lowest monthly occupancy we've experienced in the history of the hotel," said Wayne Buckingham, managing director of the 740-room Royal Orchid Sheraton on the banks of Bangkok's Chao Phraya river.

Particularly hard hit has been the hotel corporate and conference business, which is more sensitive than individuals to the travel warnings issued during the airport occupation, the climax of months of sometimes violent political confrontation.

"People have been through tough times in Asia before and they've got out of it at the other end, and we'll do as well. It's just that this one will take a bit longer," Buckingham said, estimating 12-18 months before things "return to normal."

FEELING THE PINCH

With the export-driven economy already feeling the pinch from the global economic slowdown, many analysts believe the airport protests by the People's Alliance for Democracy (PAD) may prove to be the decisive factor in tipping Thailand into recession.

Even if tourism avoids the large-scale layoffs already hitting manufacturing, getting the industry back on its feet will be yet another headache for new Prime Minister Abhisit Vejjajiva, now in charge of a shaky, multi-party coalition.

If the Oxford-educated economist starts diverting provincial cash to tourism in Bangkok or the south, where the best beaches and strongest support for his Democrat party are to be found, he risks further alienating voters in the north and northeast, where loyalty to ousted leader Thaksin Shinawatra runs deep.