Chiang Mai Tourism Woes

Tourism may be down worldwide, but Thailand has been especially hard hit due to political problems, closures of international airports, double pricing scams, taxi ripoffs at the airport, and blatant discrimination against the tens of thousands of expats who call Thailand home. Chiang Mai has been trashed in the tourism field, with record low occupancy levels at the more expensive hotels, and increasing complaints about smog and traffic congestion. Will the upcoming high season be any better? The Bangkok Post looks at the current situation and hopes for the coming months.

Tourism operators in Chiang Mai are desperately hoping for promising business in the coming high season as room reservations by foreign tourists are still very low and trips by local travellers are not enough to offset them.

Reservations in Chiang Mai are still very low for the November-April period as some foreign tourists have delayed their decisions due to the lingering impact of the global recession.

However, the Thai Hotels Association's Northern Chapter expects more local tourists to travel to Chiang Mai when the weather gets cooler. They may plan their trips a week in advance and that should help the local operators to a certain degree by the end of this year.

Kanog Suvannavisutr, the association's president, said it projected an average high-season occupancy rate at 65% at most, compared with 67% in the same period last year. For the latest off-season (May-September), the rate dropped to 36%.

"Apart from the hotel oversupply problem, global economic problems, local political instability and the H1N1 flu are key factors dragging down Chiang Mai tourism," he added.

Mr Kanog said two-star hotels survived with some bookings because their rates were low, not more than 800 baht per night, and thus attracted local tourists and backpackers.

Four-star hotels with conference facilities are also getting some business because conferences are an important market for Chiang Mai. Their room rates are modest, at about 1,500 per night in the low season. The average occupancy of such four-star hotels wa 50%, which is very good for hotels in Chiang Mai.

Meanwhile, five-star hotels are in deep trouble because they cannot compete with four-star ones that offer room rates at almost half the price. Their occupancy is only 20% as a result.

Mr Kanog said hoteliers in Chiang Mai were also facing tough competition from apartments, which draw travellers during the high season, even though the law prohibits apartments from providing accommodation on a daily basis.

"Despite complaints made by hoteliers, apartments still accommodate guests on a daily basis. This is because the fine is small," Mr Kanog said.

In any case, operators hope that the economy will improve next year. The improvement should increase the purchasing power of tourists, especially foreign ones, and they should return to Chiang Mai, he said.