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Reprintted from Bangkok Post

Minor International Plc, which runs more than 500 hotels across 55 countries, may cut more jobs and shut recently re-opened properties as the coronavirus pandemic and travel restrictions continue to keep guests away.

“We have hotels that can’t even pay for staff or electricity because they’re totally empty,” Bill Heinecke, chairman and founder of Bangkok-based Minor, said in an interview. “We’ve taken a lot of job cuts and we’ll probably have to take more.”

Minor posted its biggest quarterly loss in the three months ended June and has cut thousands of jobs to stay afloat after the pandemic ground to a halt global travel and tourism. Travel for leisure and business remains mostly suspended even in countries with relative success in containing the outbreak.

Thailand’s reluctance to open its borders makes it one of the most difficult markets for Minor, Mr Heinecke said.

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While Thailand has been hailed by the World Health Organization as a success story in its handling of the outbreak, it has delayed a plan to reopen borders to foreign tourists following local resistance over concerns of a second wave of infections.

With a special visa programme for tourists requiring a mandatory 14-day quarantine and minimum 90 day stay, not many holidaymakers are likely to return.

“It’s complicated to come to Thailand, and it’s clear to me that Thailand doesn’t want visitors right now in their policymaking,” Mr Heinecke said. “Maintaining zero cases of local transmissions by keeping the country hermetically sealed has come at the expense of the national economy.”

Chinese rebound

Out of the 526 hotels Minor operates, 83% are currently operational and Mr Heinecke expects to push up the ratio to 90% by the end of the fourth quarter.

The group’s businesses in China have returned to pre-pandemic levels with occupancy rate at its two hotels rising to about 80% in August. 

Its food operations saw same-store sales growth of 8%.

The American-born tycoon expects China, which has been Thailand’s top source of foreign visitors and tourism revenue, will be an important factor in shaping the nation’s economic recovery. The country is on course for its worst ever contraction this year due to the slump in exports and tourism sectors, its two key economic drivers. 

Thailand accounts for only 6% of Minor’s hotel portfolio.

“China’s economy is booming, Thailand’s economy is a disaster,“ Mr Heinecke said. “Once China will allow its people to go abroad, I sincerely hope Thailand is one of the first countries to welcome them, because if not, I believe our economy is toast.”

Minor posted a net loss of 8.45 billion baht in the second quarter as revenue tumbled 79%, according to a Stock Exchange of Thailand filing. The company’s shares have slumped 43% this year, outpacing the 20% drop in benchmark SET Index of stocks.

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The Finance Ministry is finalising details of the 3,000-baht cash handout scheme, with initial daily spending disbursed through an e-wallet application and a cap of 100 baht.

Details are expected to be finalised by the Fiscal Policy Office before submission to the Center for Economic Situation Administration on Thursday, said a Finance Ministry source speaking on condition of anonymity.

The cash handout scheme’s total value is 45 billion baht.

Under the measure, the government will give 3,000-baht cash handouts to 15 million people to buy consumer goods.

Recipients are required to register for the cash and the money will be transferred through the Pao Tang app’s G-wallet app, similar to procedures under the Taste, Shop, Spend scheme.

The main difference lies in how daily spending is capped at a limited amount for the 3,000-baht scheme.

The initial proposal required individuals to spend at least 100 baht per day at shops registered to participate in the programme, said the source.

The government will subsidise 50% of all spending on a daily basis.

For instance, if a sum of 100 baht is spent at a local shop, the shop would collect 50 baht from a consumer, while the government would pay the remaining 50 baht to the store owner.

“We chose this spending approach because we want consumer spending to be distributed to different stores, especially small shops such as noodle shops and grilled pork vendors, instead of large sums being spent once,” said the source.

“This is in line with our objective to stimulate the overall economy.”

The scheme is expected to begin in early October and will run until year-end 2020.

Funding will come from a credit line of emergency loans allocated for economic recovery worth around 45 billion baht.

To be eligible for programme participation, individuals must be at least 18 years old and participating shops must be those who participated in the Taste, Shop, Spend scheme and We Travel Together programme.

The number of shops that participated in the two schemes number 70,000 nationwide, said the source.

For shops interested in participating in the 3,000-baht cash handout scheme, a registration system will be launched once the scheme receives cabinet approval, said the source.

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Let’s hope that the hotel, restaurant, souvenir and massage shops, the retail giants, hospitals and others that depend on foreign trade read the Bangkok Post and force some action on the Thai government and TAT who of course have their own ideas about stimulating tourism and the economy.

Naturally they are heralding Thailand Elite and high spending short term tourists as that is where all their money has gone so that they can turn round and tell us how successful they have been.


Forget the retired expats that Bering their lives savings and pensions to Thailand to spend on a daily basis – they have.

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Resort island looks to diversify after Covid-19 cripples tourism

Phuket has been forced to take on board a difficult lesson: that it shouldn’t have clung to tourism as its single, dominant cash cow.

The country may have managed to flatten the Covid-19 curve, but the economic curve risks going into freefall.

Tourism has been one of the hardest-hit sectors and Phuket businesses, which rely almost exclusively on foreign arrivals, dread to estimate when the current economic crisis, one of the worst in recent memory, will bottom out.

TOURISM HIT HARD

Phuket may have been the victim of its own success. Firmly positioned as a world-class destination, the island province has earned substantial revenue from foreign visitors, many of them with deep pockets.

So when a destructive disease like Covid-19 forced border closures and ground flights to a halt, Phuket’s income slowed to a trickle and the local economy risks total meltdown.

The sheer scale of economic damage to Phuket caused by the pandemic has revealed a systemic void in the province’s preparedness to effectively counter or mitigate a sudden nosedive in the industry.

The sector employed 323,219 people locally before Covid-19 struck early this year, generating 245 billion baht in the annual gross provincial product, according to provincial governor Narong Woonsew.

He said a whopping 80% of the province’s economy relies on tourism. The damage so far to the province’s tourism sector brought about by the outbreak is estimated at 160 billion baht.

The figures present real cause for concern. Tourists visiting Phuket this year are forecast to shrink to five million, substantially down from last year’s figure of 14.4 million. Of those five million tourists, 1.5 million will be Thais.

NEW GROWTH DRIVERS

Mr Narong has said the major slump in tourism has prompted a rethink of the province’s economic advancement strategy.

“After the government ordered the closure of our skies, Phuket’s tourism revenue was wiped out,” he said.

And even when the tourism sector in Phuket finally resumes the full extent of its business under “new normal” practices, there will have to be a paradigm shift in the way the province figures out where it will derive its income.

Mr Narong explained that in the medium and longer term, the provincial office and tourism companies are looking to diversify and promote a variety of sectors as new drivers of the province’s growth.

Six sectors have been earmarked; marinas, education, health and wellness, tuna exports, seafood and gastronomy as well as sports and events businesses.

“These will be our new economic engines which will function alongside the conventional tourism businesses,” the governor said.

Chernporn Kanjanasaya, chairwoman of Phuket Industry Council, said inter-sector councils and associations, including those representing the chamber of commerce, local tourism enterprises, hotels, real estate businesses and urban developers have come together to plan these new income generators.

“The new revenue drivers will not replace the conventional tourism businesses but build on top or add value to them. Tourism, after all, is a long-established industry with the resources and capability to sustain Phuket’s economy well into the future,” believes Ms Chernporn.

However, the province must be better equipped and more resilient to crises and that can be achieved by having a broader portfolio of industries to offset the economic risks, she warned.

BIG REVENUE GENERATORS

The chairwoman said Phuket is home to five marinas, 38 seaports and one deep-sea port. About 1,500 yachts and cruise ships call on the province each year on average.

She said the marina business brings in tourists with high spending power and infrastructure developments are needed to attract large cruise ships to visit the province.

Around 3,600 people visit aboard yachts annually. They spend an average of 60 days in Phuket, earning the province 21.6 billion baht.

For education, the province is looking to create internationally accredited study programmes to increase enrolments of foreign students. Phuket, which is currently the location of 12 international schools, has set a yearly revenue target of 2.1 billion baht from 3,600 students.

In terms of tuna exports, the future looks bright, said Ms Chernporn. Phuket has both state-run and privately owned wharves where more than 200 boats from Japan, Taiwan and the United States arrive to buy top-grade tuna at high prices. The exports are worth 1.3 billion baht a year.

Also, the gastronomy industry is a lucrative cash spinner which capitalises on the island province’s unique food culture at its 1,977 restaurants. The annual turnover of the sector is estimated at 91 billion baht with more room to grow in the future.

Ms Chernporn said the geography and weather in Phuket are ideal for organising sports, social and commercial events, adding that wedding arrangements alone give a 1.6-billion-baht boost to the local economy per year.

“We’re studying each sector in minute detail. Right now, the most ‘up and coming’ sector is sports and events which can help accelerate economic recovery for Phuket.

“It will be the forefront of tourism stimulus efforts starting next month and in September,” said Ms Chernporn.

OBSTACLES PINPOINTED

She said each prospective growth driver will have a sub-panel tasked with identifying any legal hindrances to it realising its full potential. The sub-panel will be made up of government officials and members of the business community.

The six sub-panels will present their findings to the government and ask for its help in amending troublesome regulations. For example, legal restrictions imposed by 17 different agencies may be a setback to promoting marinas.

Also, the education sector cannot be a magnet for overseas students unless certain visa requirements are relaxed to allow students and their parents to stay in Thailand longer than 90 days.

In addition, tuna exports cannot expand if illegal, unreported and unregulated fishing is not completely tackled, she said.

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Tourism-related businesses are at a tipping point after more than 30% of them have exited the market, with many set to follow, according to the Tourism Council of Thailand (TCT).

Chairat Trirattanajarasporn, president of the TCT, said the tourism industry predicts a further deterioration after six months of the coronavirus crisis, as many related businesses are terminating their operations or selling off assets, choosing not to wait for an uncertain recovery.

He said the main types of businesses affected by the crisis are tour operators, bus services with a small vehicle fleet, restaurants, souvenir shops and hotels that used to focus on foreign tour groups, especially the Chinese market.

Mr Chairat said the TCT is in the process of collecting the exact number of members fleeing the sector, which he believes should amount to more than 30% in the first half of the year, as Thailand continues to seal the borders to international tourists.

The Tourism Department said 1,111 tour operators in the January-June period gave up their licences and asked for their guarantees back.

The figure hit a crescendo in June as 262 companies permanently quit the market, while withdrawals in the second quarter made up 65.4% of all withdrawals in the first half as tourism reeled from lockdown measures.

If travel bubbles cannot be implemented this year, more than 30% of outbound operators will have to permanently shut down their business, said Thanapol Cheewarattanaporn, president of the Thai Travel Agents Association.

At present, most operators have staved off making any decision as they are waiting for further details on travel bubble agreements with other countries. After the infections of an Egyptian airman in Rayong and the daughter of a Sudanese diplomat were detected, these agreements may take even longer to come about.

“The domestic market has become a priority market for tour operators who want to maintain business while waiting for borders to reopen,” Mr Thanapol said.

The association also encourages members to join the government’s Moral Support campaign while providing packages to serve domestic meetings and seminars.

Mr Thanapol said Thai outbound tourists who prefer standardised services and are concerned about health issues are another potential market.

The outbreak could be an opportunity to increase the average number of individual local trips from 3.5 trips a year to six trips by next year.

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Foreign visitors still stranded in the kingdom by the Covid-19 pandemic will be allowed to apply for an extended short stay after their visas expire on July 31, the Immigration Bureau chief said on Friday.

Foreign tourists who are unable to leave Thailand would be given a grace period from Aug 1 to Sept 26 to apply to stay for a specified period, said the bureau. However, if they do not obtain extensions and are still in the country after Sept 26, they would face legal action and be blacklisted.

Foreigners should contact the bureau as soon as possible to prepare for their next steps as the Sept 26 deadline approached.

Foreign visitors must submit necessary documents when seeking to renew short-term visas, which will be granted for 30 days.

“If they are unable to return because there are no flights or due to lockdown measures in their countries, they must submit proof. The granting of a short-stay visa will be made on a case-by-case basis,” an immigration official said during a visit to Phuket, a province with a high number of stranded foreigners.

He estimated that between 300,000 and 400,000 foreigners were stranded in the kingdom due to the lockdown.

The government earlier automatically extended their visas until July 31, but they must still inform authorities where they are staying.

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There was no infection found among the 1,603 people tested for Covid-19 after being in places visited by an infected Egyptian soldier in Rayong and the infected young daughter of a diplomat in Bangkok.

In Rayong, 1,336 people underwent coronavirus tests on Tuesday. They had been at the hotel where the infected Egyptian stayed, or at one of the shopping malls he visited, the chief of the Disease Control Department, said on Thursday.

All tested negative. 

In Bangkok, 267 people who thought they may be at risk were tested on Tuesday. None were infected.

Most lived at the One X condominium building in Sukhumvit area where the Sudanese attache’s family stayed after arriving from Khartoum. The young daughter later tested positive for Covid-19. 

On Wednesday, samples were taken from another 1,252 people in Rayong. They were awaiting the results, he said. 

Although tests came back negative, these people should continue to wear face masks, frequently wash their hands, observe social distancing and avoid going out for 14 days, the chief said.

The Sudanese girl’s case involved six people who were at high risk of infection – five family members and and an embassy driver – and 18 others who were at low risk – 16 people living at the condominium building, and two foreign affairs officials.

In the Egyptian Covid-19 case in Rayong province, 12 people were at high risk of infection, including a taxi driver who talked with the infected soldier for five minutes.

People facing a low risk included 885 visitors to Passione Shopping Destination mall and 447 people who went to CentralPlaza Rayong. 

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oldiers of the Royal Thai Army, heading back next week from a joint military exercise with US troops in Hawaii, will be placed in state quarantine at a hotel in Bangkok, not in Nakhon Ratchasima as earlier planned. The northeastern province’s governor made the announcement today. He had previously approved a request from the 3rd Infantry Division to place 151 soldiers in quarantine at a Nakhon Ratchasima hotel.

The soldiers are participating in a joint exercise codenamed Lightning Forge 2020, in Hawaii until July 21. They’re due to return to Thailand on July 22.

The governor says the Sripattana Hotel in Nakhon Ratchasima was being readied for a 14 day “organisational quarantine”, from July 22 – August 6. But in a quick U-turn, the Thai commander of the troops has sent an urgent message yesterday, informing him that the planned quarantine in Nakhon Ratchasima had been cancelled.

The commander of the 2nd Army commander says the 151 soldiers will undergo health screening and 14 day state quarantine at a hotel arranged by the army in Bangkok instead.

The change follows the controversy surrounding the discovery that an Egyptian soldier, later confirmed to be infected with Covid-19, was among members of a visiting military delegation who ignored quarantine and visited several locations, including shopping malls, in the eastern Rayong province during a stopover in Thailand.

The incident has prompted the Centre for Covid-19 Situation Administration to review conditions allowing special exemptions for some groups entering the country.

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Prime Minister Prayut Chan-o-cha has called on residents in Rayong to resume their normal lives while Deputy Public Health Minister Sathit Pitutecha confirmed no local transmissions had turned up in the province after an infected Egyptian soldier stayed there without being quarantined.

The premier on Wednesday travelled to Rayong from Bangkok by helicopter to observe disease investigations and Covid-19 tests for the general public.

Gen Prayut and his entourage, including Deputy Prime Minister and Public Health Minister Anutin Charnvirakul visited D Varee Diva Central Rayong and Passione Shopping Destination mall — the places where the infected soldier spent time while staying in Rayong. Later, the PM visited Star Market to offer moral support to local people.

The prime minister apologised to the people of Rayong and promised them this kind of event “would not happen again”, referring to the infected soldier who was not in quarantine while staying in the province.

He called on people to remain confident in the public health system and doctors, asserting there would be no more VIPs going astray and that everyone must be tested for the virus.

Gen Prayut said he would take responsibility for the incident and urged everyone sides to treat the Rayong event as a lesson. The premier called on the media to avoid running news reports that stir up nationwide panic and suggested they focus on reporting the fact that there have been no new local transmissions in the country.

Meanwhile, business people and members of the general public in Rayong on Wednesday went to Government House to submit a petition to the prime minister, asking for the cancellation of 14-day quarantine exemptions for foreign visitors.

One representative, Thatchaya Chuangsanthat, said the people of Rayong always cooperated with the government’s preventive measures against Covid-19 but now they faced discrimination.

They started to get back on track after the government relaxed lockdown measures and no community infection had been detected for over 100 days, she said.

“The people of Rayong have lived without much income for the past four to five months but we accepted the situation and complied with every measure,” Ms Thatchaya said.

“But we could not accept that the government and the Centre for Covid-19 Situation Administration allowed foreigners in without state quarantining.

“We do not want an apology. We want the government to respond to what happened and treat everyone equally.”

Ms Thatchaya added she planned to go to the Egyptian embassy in Bangkok to demand answers from them.

The Rayong Chamber of Commerce is also calling for an apology from the government and moves to save the tourism sector, after mass hotel cancellations were sparked by fears of catching coronavirus.

Provincial trade body chairman Noppadol Tangsongcharoen said on Wednesday local operators needed measures to aid their businesses, not just a government apology .

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The second phase of the Sino-Thai high-speed railway (HSR) will help Khon Kaen realise its potential as a transport hub in the Northeast, according to provincial governor Somsak Jangtrukul.

“When the high-speed trains are ready to roll, Khon Kaen will be [the region’s] public transportation hub,” said the governor at the second public hearing for the 365-kilometre long rail route, which will link Nakhon Ratchasima with Nong Khai through Khon Kaen and Udon Thani.

The first hearing was held in Nakhon Ratchasima on Monday. Another forum is scheduled in Udon Thani today and in Nong Khai tomorrow.

About 500 people attended the second hearing on Tuesday, which was held at the Khon Kaen International Convention and Exhibition Centre.

Khon Kaen already has a large elevated train station, as well as a fully operational double-track railway which serves both passenger and cargo services.

Several new road projects are currently under construction and the airport is currently being expanded, the governor added.

“The expansion will increase Khon Kaen airport’s annual passenger handling capacity to 5 million, with six new aprons currently being built in addition to the five already in operation,” said Mr Somsak.

According to Mr Somsak, the second phase of the project will accelerate the development of a rail transport network across key provinces in the Northeast, which will in turn spur businesses located along the high-speed rail route.

Phase 2 of the project will see the construction of five stations along the line, namely Bua Yai Station in Nakhon Ratchasima, Ban Phai Station in Khon Kaen, Khon Kaen Station in the city centre, Udon Thani Station and Nong Khai Station.

The line will have the standard track gauge of 1.435 metres and a total of 241 crossings, said Mr Somsak.

Once completed, a trip from Bangkok to Nong Khai will only take about three hours and 15 minutes.

Design and feasibility studies for the second phase of the project, which began last year, are due to be completed next year, said Mr Somsak.

The Northeast’s cultural identity will be incorporated into the design of the stations, he said.

The hearing in Khon Kaen came after the board of the State Railway of Thailand (SRT) last month approved the draft of the so-called “Contract 2.3” with China, paving the way to begin construction of the high-speed train project.

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