The tourism industry, which is recovering from the effects of the pandemic for the last two years, is now facing another threat from the Russian invasion of Ukraine. The threat is more prominent for Thailand which sees a major influx of tourists from Russia. According to a report by The Bangkok Post, Thailand’s Department of Disease Control said Russia topped the list of international tourist arrivals in February with 17,599 travellers, following the resumption of the Test and Go scheme.
However, as NATO countries along with the United Nations impose severe sanctions on Russia, the value of the ruble continues to hit rock bottom in the international market. Speaking to The Bangkok Post, Paul Pruangkarn, chief of staff at the Pacific Asia Travel Association, said increasingly aggressive international sanctions on their country have resulted in Russians scrambling to withdraw money from ATMs. It is predicted that Russians are unlikely to spend as much on travel as they save to prepare for difficult times.
Speaking to BloombergQuint, Charintip Tiyaphorn, co-owner of Pimalai Resort & Spa in Krabi said, “We received emails from agents and sales representatives in Russia that they may not be able to transfer money to Thailand due to sanctions, so this will have some future impacts too.”
Tiyaphorn added, “We are more worried about flights from Europe to Thailand that may have to re-route, and this would make it more difficult and costly for European travellers to travel to Thailand.”
The Bangkok Post reported that Thailand’s Finance Ministry estimated that the ongoing sanctions on Russia would incur a loss of at least 35.9 billion baht (approx Rs 83.5 billion) in tourism revenue from the Russian market. This is expected to lower Thailand’s GDP by 0.2% if the projected 4,50,000 Russian tourists for 2022 are no longer able to visit the country, the report further said.
Besides an array of sanctions that target Russian Oligarchs and trade with Russia, the West has also removed selected Russian banks from the international SWIFT payment system, which enables the smooth transfer of money across borders. On Tuesday, US President Joe Biden announced that the country will ban all Russian flights from its airspace, taking effect from the end of March 2.