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Phuket airport this week: a tourism record that does not convert into revenue

Phuket's Future, Free from Fortune Tellers

Wednesday, December 29, 2010
News Analysis: 2010 and Phuket Tourism

PHUKET will achieve a record number of tourist arrivals this year. But many people will be left wondering where the money went - and what the future holds.

The paradoxes of the Phuket tourism business extend to resorts and flights, to tours and diving businesses and souvenir stalls, bringing into sharp focus the issue of Phuket's strengths and weaknesses.

In response to the severe test of political upheaval in Bangkok and unnecessary travel alerts, Phuket proved so resilient that a record number of travellers - probably exceeding the maximum capacity of 6.5 million arrivals and departures - will pass through Phuket International Airport this calendar year.

Yet people are now scratching their heads and wondering where Phuket's 2010-2011 high season went.

Phuket has longed for a more even tourism year, and now it has one. But a broad range of factors have flattened the peak season.

Instead of lifting the low season to high season levels, the grader of fate has levelled this high season flat, compacting it towards low season numbers.

For Phuket, the benefits of a boom year have scampered down a black hole faster than a scared rabbit. So many things went right in 2010. And so many things went wrong.

Where Phuket is Now


PHURIPAT Theerakulpisut, who as Chief of Phuket's Marine Office 5 oversees seaborne tourist traffic, was surprised by what he found this week. On a trip to check safety features including the provision of lifejackets, he found sea trips and tours had been cut by half.

''Businesses say it's as though the low season has come in the high season, that trippers have dropped by about 50 percent,'' he said. ''We would expect 18 or 20 boats to be heading out every day with tourists at this time of year.

''Nowadays, there are 10 to 12 venturing to sea from Rassada and Chalong pier [Phuket's two main departure points].''

The President of the Southern Region branch of the Thai Hotels Association, Suchart Hirankanokkul, reports that occupancy figures on and around Phuket are substantially down on expectations.

''Now the rate is 80-90 percent, which seems high except that in a normal year, we would be expecting to turn people away,'' he said.

And so the curse of Phuket has struck again, this time morphing into the unlikely shape of a fortune teller who predicts that a second tsunami will arrive tomorrow.

Suspicious Thais have stayed away in droves, says Khun Suchart. Given the sesitivity of Asians in general to such superstititons, Phuket's resorts, tourism authorities and national officials are now being urged to make the point in March at ITB Berlin, world's biggest travel fair, that Phuket and the Andaman is safe.

For resorts especially, that will mean throwing off their preference for secrecy about safety. But that's what the market is now demanding.

Europeans are also not travelling in their usual numbers this high season. Khun Suchart says this is mainly because the baht is riding so high against the euro, making long-haul travel too expensive for many.

The THA's marketing officer, Bhuritt Maswongssa, says that Bangkok talk of a boom on Phuket, triggered mostly by news of the airport expansion, has proved to be nonsense. He says Russian tourists among others are certainly coming in greater numbers, but the numbers have not been converted into increasing revenue.

What Next for Phuket


ARE THERE too many hotels on Phuket? Yes, of course there are. The rate of increase in rooms is running ahead of increasing numbers of visitors.

Are they the right kind of visitors? No, they are not. In desperation, Phuket's tourism industry has slashed prices and done deals to keep the cash flowing.

While Phuket has emerged from the political violence of 2010 in better shape than any of its Thai counterparts, the cost has been a damaging change in direction.

Package tourism is never going to be a winning play for Phuket, where the region's potential as a playground for the wealthy remains unrealised. Fewer travellers with more money is what the island wants and deserves.

Only by heading that way can the natural attractions be properly preserved from the tramp of too many feet. But constant crisis economics have skewed the tourism market in the opposite direction.

Yet another ''crackdown'' by authorities is required to make sure that all future stocks in the resort and guesthouse business are legal and to a high standard, and that environmental legislation is enforced.

Phuket now more than ever desperately needs the guiding hand of a modern Lee Kuan Yew, a benevolent dictator with a strategy that goes beyond next year's bank account.

Only a special economic zone taking in Phuket, Phang Nga and Krabi can provide the cohesion to stabilise and improve Greater Phuket as a destination option between now and 2020.

Without government action, the future will remain decidedly hazy and unclear. To see that, we don't need a crystal ball.
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Comments

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A couple of interesting points.

Many readers, including me, have questioned the overly positive predictions and arrival/occupancy numbers this year.

Just last week Phuket was reported to have 70% occupancy, now Khun Suchart suddenly claims it to be 80-90%.

At the same time daytrips have dropped by 50% and occupancy is down substantially.

Hmm...

These numbers have no credibility but fortunately Khun Buritt steps in and spells out the truth:

"talk of a boom on Phuket ... has proved to be nonsense"

Another point, this for the Editor.

The other day you said

"Enforcement is a western concept. Gradual change is a Thai one"

Today you advocate bringing in someone as authoritarian and known for strict law enforcement and stiff penalties as Lee Kuan Yew ?

Was the first one just an observation and the second one your opinion ?

I certainly would like to see someone like Lee Kuan Yew take over Thailand. This country totally lacks discipline and law enforcement.

Heck, if I was to start a business here, I'd open up a boot camps all over the country.

Posted by Chris on December 29, 2010 20:30

Editor Comment:

Chris, booking forecasts change every day, so it's not difficult to understand how 70 percent bookings can grow to 80-90 percent. Bookings tend to do that. Occupancy rates are what resorts declare as their official figures. Departures-arrivals are what the airport declares as its departures-arrivals. If people who are arriving have less to spend, it figures that they won't do as much when they get here. So it's perfectly possible for the figures you ''Hmmm'' about to all be correct. The daytrips 50 percent figure is what's known as an estimate.

Phuketwan has long advocated a special economic zone for Phuket, and a benevolent dictator. That's political, and not out of kilter with cultural and social change, which need to be slow and well managed.
How are your nits today? Itching?

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Sure it's possible for the figures to be correct, just as it's quite possible they are not.

People talk about

"significant drop"
" 50% down"

and the

"boom on Phuket... being nonsense"

Those are not indicative of subtle adjustments. Though I'm sure tourists spend less than before, I doubt their spending budget has been cut in half.

The truth is neither of us really knows, we just speculate and often so in opposite directions.

That of course keeps the conversation lively, which is good.

As to the nits, I don't have any and neither has my dog. She just had a bath today and due to the lack of dog shampoo now smells like a bucket of flowers.

Posted by Chris on December 29, 2010 21:43

Editor Comment:

We don't speculate: we ask people in the industry what their judgements are, and report what they tell us. You come along and find fault with everything, without offering an alternative. If you keep this up, I will have to ban you from reading Phuketwan.

Go make up your own figures, and scratch your own nits.

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I don't make up anything. I speak from both my own experience and what has been reported elsewhere. That is what the average reader can do.

I comment on what you write here and if you do not like what I say, just ask me not to anymore. I can live without fencing with you just as you can live without me.

A media outlet does need some readers though, where as I need nobody to listen to what I have to say.

What kind of "alternative" can there be in this situation ? Collecting my own numbers ? I can't do that but I expressed my opinion about their accuracy and many others have done so too.

Nowhere did I imply the inaccuracy results from your reporting. I know you report what you are being told or find.

In another discussion you were challenged and asked readers for other suggestions. I responded and offered one, as I have done several times before.

Criticism without suggestions for a better solution carries little weight.

To blame me for whining about everything without offering alternatives is not fair.

BTW, you can't ban anyone from reading PhuketWan but you can certainly drive away a lot of readers.

Posted by Chris on December 29, 2010 22:26

Editor Comment:

I know I can't ban readers . . . it was a joke, Chris, along with the nits comment and the ''making up your own figures'' line. Frustrated at the approach of a reader, the editor of a London paper once famously said: ''Well I ban you from reading The Sun, then.'' (laughter.) Understanding what's written and the potential for misinterpretation appears to be a constant issue - especially when it comes to percentages and the number of people arriving and departing on Phuket. All we can do is report the figures. Some readers seem to misunderstand where the figures come from and ascribe every variation to a conspiracy. We try to choose our words carefully, but you're right: we can't choose our readers. As we've just proved, even jokes can be misinterpreted. On some topics, though, it's a case of being half-pregnant - compromises are not possible. That's definitely the case with land ownership. Trying to satisfy everybody only leads to abuses. The rules are plain but poorly enforced. You can bet that some of the same people whose constant refrain is ''enforce the law'' happily bend it when it suits them - which doesn't mean they aren't honorable and pleasant people in every other circumstance. Happy New Year to you.

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Tourist bookings down only 50%. HUH, down by 93 % in the charter of boat business. Get real OK?
Don't talk codswallop to me in this business ok?

Posted by GrahamM on December 30, 2010 00:43

Editor Comment:

GrahamM,
May we quote you on that? Might as well add it to the other figures. ''Source connected with charter boat industry says numbers are down 93 percent.'' What you need to understand, GrahamM, is that figures will vary enormously. Some charter boats may be doing better, if they have marketed their businesses effectively. It's the same across the board. There is no consistency to these estimates. More of the people who are coming to Phuket are definitely not charter boat types - yet the organisers of the next month's Pimex boat show are expecting it to be the most successful ever for visitors and boat sales. Strange, isn't it, how people can see the same situation in quite different ways. Less of the ''codswallop,'' please. We are just reporting what we are told. To survive, you may need to learn to think for yourself. See you at the boat show.

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"Package tourism is never going to be a winning play for Phuket".

I'm afraid it's already too late and reversing the trend is just not going to happen.

The TAT mouths that they want "quality" tourists, yet, spends millions on road shows to countries where package tourism is the norm.
For the TAT, it's a numbers game. That's how they measure success.

Posted by Sir Burr on December 30, 2010 07:09

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Good one Ed lets meet at Double Issue at PIMEX.
Happy New Year to you and your family and staff.

Posted by GrahamM on December 30, 2010 07:31

Editor Comment:

Thanks, GrahamM. Likewise to you and all our readers and their families and friends. I am sure there will be plenty to talk about in 2011.

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It is necessary to ignore the Fortune Teller in Public. Children live in Fear in Phuket and tourists cancelled their holidays because of this One Idiot called Mr Warin. I have a wish: please Write something about this man, that he was wrong. This man should never Tell the Future again! As a real Phuket lover i am here with my family and Friends and i Hope you Fight with your newspaper against this man in Public. Hope to Read it soon, your Peter from Austria, Europe.

Posted by Peter on December 30, 2010 17:14


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