Thailand’s tourism industry is facing mounting concern as it risks losing its long-held status as Southeast Asia’s premier travel destination. Industry leaders warn that continued stagnation, coupled with Vietnam’s explosive growth in foreign tourist arrivals, could soon tip the balance in favor of its regional neighbor.
Vietnam’s international tourism numbers have surged, with a nearly 50% increase in visitor arrivals in March 2024 compared to pre-pandemic levels—while Thailand still struggles to fully regain its previous volume. This contrast has raised alarms across Thailand’s tourism sector, with fears that global traveler preferences are shifting toward more affordable, better-connected, and increasingly vibrant Vietnamese destinations.
Vietnam’s Strategic Tourism Push
Tourism stakeholders attribute Vietnam’s rapid growth to strategic government support and infrastructural advantages. Thanet Supornsahasrungsi, president of the Association of Chon Buri Tourism Federation, highlighted Vietnam’s proactive policies, such as subsidized airfares and reduced airport landing fees, particularly benefiting foreign travel agencies, including Russian operators.
As a result, major tour companies have redirected focus to Vietnam’s coastal cities like Nha Trang, especially during peak travel periods—diverting tourists from traditional Thai hotspots like Phuket.
Airport Accessibility and Infrastructure
Vietnam’s airport infrastructure has become a major competitive advantage. International airports in cities like Hanoi, Da Nang, and Ho Chi Minh City are located within 30–45 minutes of key tourist areas. In contrast, travelers arriving in Thailand often face long transfers—over three hours in some cases—from Bangkok to destinations like Hua Hin and Kanchanaburi. This disparity in travel ease may increasingly influence destination decisions.
Vietnam’s Cost Advantage and Family-Friendly Appeal
Vietnam’s lower travel and living costs also significantly bolster its appeal. Thanet noted that Vietnamese family-friendly resorts, attractions, and theme parks are often newer, more affordable, and bundled into cost-effective packages—sometimes at half the price of similar offerings in Thailand. This cost competitiveness is particularly attractive to families and budget-conscious international travelers.
Thailand’s Slowing Growth Raises Alarm
The numbers highlight the urgent concerns. Thailand welcomed approximately 2.7 million international visitors in March 2024—a 20% drop from the same period in 2019. Vietnam, in contrast, received over 2 million visitors, marking a 40% increase from its pre-pandemic levels.
Thailand has revised its 2024 forecast downward, from 38.5 million to 36.5 million visitors, while Vietnam aims ambitiously for 23 million. According to Thanet, Vietnam could overtake Thailand in total international arrivals within the next two to three years.
Bangkok Faces Rising Competition from Ho Chi Minh City
Concerns are also growing about Bangkok’s waning status as the region’s top urban tourism and nightlife hub. Sanga Ruangwattanakul, president of the Khao San Road Business Association, cited shrinking Chinese interest in Bangkok and rising attention toward Ho Chi Minh City’s vibrant nightlife districts as key indicators of shifting trends. He warned that without reinvestment and innovation, iconic Thai destinations like Khao San Road could lose their global appeal.
Thai Industry Response: Targeted Subsidy Plan
In response, the Association of Thai Travel Agents (Atta) has proposed a 320-million-baht subsidy plan to revive Chinese tourist arrivals. The plan anticipates bringing in 150,000 Chinese visitors, generating an estimated 8.3 billion baht in revenue based on average spending figures.
The proposed program would follow a public-private model—80% funded by the private sector—with conditions to ensure cost-efficiency, such as requiring a minimum of 150 tourists per subsidized flight.
Subsidy Plan Highlights:
320 million baht requested
8.3 billion baht in projected returns
80% privately funded
Focus on Chinese inbound market
Call for Government Action
Industry leaders are calling for immediate and decisive government action to address infrastructure gaps, enhance safety measures, and support tourism promotion. Thanet stressed that relying on Thailand’s historic appeal without modern upgrades would be insufficient to meet revised targets or fend off growing regional competition.
Recommended measures include improvements to airport accessibility, expanded marketing in key markets like China and Russia, and investment in newer attractions and transport infrastructure.
Conclusion: A Regional Shift in the Making?
Vietnam’s rise as a competitive, cost-effective, and increasingly accessible travel destination is prompting a reassessment of regional tourism dynamics. With Thailand facing structural challenges and slow recovery, the industry stands at a pivotal juncture. Unless proactive steps are taken, the country risks a continued erosion of its once-dominant position in Southeast Asia’s tourism landscape.
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