Bangkok, August 27, 2025 –
Thailand’s tourism industry, a cornerstone of the nation’s economy contributing up to 15-20% of GDP in pre-pandemic years, is facing renewed problems as leading hospitality businesses drastically revise their growth forecasts downward.
The Erawan Group (ERW), Minor International (MINT), and Asset World Corporation (AWC) – three of the country’s largest players in hotels, resorts, and entertainment – have collectively slashed their 2025 revenue projections amid a stalled recovery in Chinese visitor numbers and intensifying regional competition. This comes as the Tourism Authority of Thailand (TAT) prepares to maintain its overall foreign arrival target at 35.5 million for the year, matching 2024’s figure, but with analysts warning of potential shortfalls.
The announcements, detailed in recent corporate filings and industry reports, reflect a broader plateau in post-COVID recovery. ERW, operator of iconic Bangkok properties like the Grand Hyatt Erawan and a portfolio spanning over 500 hotels globally, has cut its revenue growth outlook from 6-8% to a more cautious 3-5%. MINT, with brands including Anantara and Avani resorts across Asia and beyond, cited similar pressures, while AWC, focused on mixed-use developments like the Asok and Sathorn complexes, reported a 70% surge in direct bookings through strategic partnerships but still anticipates moderated expansion due to subdued demand.
These adjustments follow a first-half 2025 where international arrivals dipped 5% year-on-year to around 16.8 million, largely driven by a 34% plunge in Chinese tourists compared to 2019 levels.
Historically, Chinese visitors have been the lifeblood of Thai tourism, peaking at 11.1 million in 2019 – nearly 28% of the country’s total 39.8 million arrivals and generating billions in spending on shopping, dining, and entertainment. That year, they averaged over 925,000 monthly visitors, fueling a sector worth $117.5 billion USD. The COVID-19 pandemic decimated this market, reducing numbers to just 6.73 million in 2024 despite a 91% rebound from 2023.
However, 2025 has seen a sharp reversal: from January to July, only about 2.32 million Chinese arrived, down 32.7% from the same period last year and representing a mere 13.6% of total visitors. Daily arrivals have plummeted from pre-pandemic highs of 30,000+ to as low as 10,000 by May, with projections now capping the full-year figure at 4-5 million – the lowest in over a decade outside pandemic disruptions.
Several interconnected factors are blamed for this stall. Safety concerns dominate, amplified by social media reports of crimes, including the high-profile disappearance of a Chinese actor near the Thai-Myanmar border in early 2025 and spillover effects from a Myanmar earthquake. These incidents have eroded confidence, particularly among group tours from second- and third-tier Chinese cities, shifting preferences toward independent travelers (FITs) who spend more (averaging 52,000 baht per trip, up from 47,000-48,000 baht) but arrive in smaller numbers.
Geopolitical tensions, such as the recent Thai-Cambodian border skirmish in July, have further dampened sentiment. Meanwhile, China’s economic slowdown – marked by a push for domestic tourism and “grey capital” restrictions – has curbed outbound travel, with Beijing promoting internal destinations amid trade uncertainties.
Regional rivals are capitalizing on Thailand’s woes. Malaysia has surged ahead as Southeast Asia’s top destination, welcoming 10.1 million visitors in Q1 2025 (a 22% increase), including 1.12 million from China – overtaking Thailand’s 1.3 million in that period. Kuala Lumpur’s visa-free policy for Chinese nationals, extended until 2026, combined with expanded direct flights, has drawn high-spending groups away. Vietnam follows closely, attracting 1.6 million Chinese in Q1 alone (up from half of Thailand’s in 2024) thanks to new routes from airlines like Vietjet and Juneyao, plus a weaker currency making it more affordable. Japan, benefiting from a depreciated yen, hosted over 3.1 million Chinese visitors in the first half, surpassing Thailand with incentives like hassle-free visas and cash rebates for groups. Even South Korea’s K-culture packages and China’s own VAT refunds for inbound tourists are siphoning market share.
In response, Thai tourism giants and the government are pivoting toward diversification and quality over quantity. ERW and MINT are leaning on domestic stimulus like the “Half-Price Thailand Travel” scheme, which has boosted low-season bookings in Hua Hin and Pattaya, while AWC’s partnerships with global networks (reaching 710 million travelers) have driven 70% direct reservations in hotspots like Chiang Mai, Samui, Krabi, and Pattaya. The TAT is aggressively targeting high-value markets: long-haul arrivals from Europe, India, the US, and the Middle East rose 14.9%, 14.88%, and 17-18% respectively in early 2025, with these visitors averaging 81,482 baht per trip – far exceeding short-haul spends of around 50,000 baht. Initiatives include the “Sawadee Nihao” campaign (May-June 2025), inviting 400 Chinese agents, 200 media, and more for familiarization trips, and the upcoming “Nihao Month” in September-December to mark the 50th anniversary of Thai-Chinese diplomatic ties, featuring a secret Chinese brand ambassador.
The TAT and Association of Thai Travel Agents (ATTA) are subsidizing up to 1,000 charter flights from secondary Chinese cities (e.g., Chongqing, Lanzhou, Hangzhou) to secondary Thai destinations like Chiang Rai or U-Tapao, with mandates for groups of 30+ and four-night minimum stays to curb “zero-dollar tours.” Digital collaborations with Baidu for AI-driven marketing and roadshows with over 300 Chinese firms aim to rebuild trust. Broader strategies emphasize eco-tourism, cultural experiences, and infrastructure upgrades, such as enhanced safety alerts, multilingual apps, and visa streamlining. The government has also revised revenue targets downward: international tourism income now at 2 trillion baht (from 2.3 trillion), with overall sector revenue at 2.87 trillion baht (short of 3 trillion).
Industry leaders remain cautiously optimistic. “This is a period of adjustment,” said Wallapa Traisorat, CEO of AWC, emphasizing collaboration for MICE (meetings, incentives, conferences, exhibitions) recovery. Thai Hotels Association President Thienprasit Chaiyapatranun stressed the need for a 7% surge in 2026 to meet Bank of Thailand forecasts of 3.5% average growth, calling for bold moves like a “Thailand Shopping Paradise” and immediate 7% VAT refunds. External risks loom, including US import tariffs currency volatility, climate impacts, and global economic slowdowns. Yet, with 35.5 million arrivals in 2024 generating 1.77 trillion baht from foreigners and 1.1 trillion from domestics, Thailand’s resilience – honed through past crises – could pave the way for a more sustainable model. As TAT Governor Thapanee Kiatphaibool noted, “Chinese tourists still love Thailand; we must show why it’s worth returning.”
For the original version of this article, please visit The Pattaya News.
