Thailand's hotel occupancy rate could drop by 10% amid Vietnam's tourism boom

Bill Heinecke, chairman of Minor International, one of the largest hospitality and restaurant companies in the Asia-Pacific region, said that since the clashes began last month, Minor hotels in Thailand have seen fewer foreign tourists, including from the U.S., Bangkok Post reported.

Heinecke estimated that total foreign arrivals in Thailand could fall by 10% compared to last year, further affecting hotel occupancy.

By contrast, hotels in Vietnam have seen higher occupancy rates, he added.

Thailand received more than 21 million foreign tourists from Jan. 1 to Aug. 24, down 7.14% from the same period last year, according to the Tourism Ministry.

Vietnam, meanwhile, received 12.2 million foreign visitors in the first seven months of this year, up 23% year-on-year.

The Vietnamese government is pushing to boost tourism through sweeping visa reforms.

In August it waived visa requirements for citizens of 12 more countries -- Belgium, Bulgaria, Croatia, Czechia, Hungary, Luxembourg, the Netherlands, Poland, Romania, Slovakia, Slovenia, and Switzerland -- for stays of up to 45 days.

This expanded Vietnam's unilateral visa waiver list to 24 countries, and the total number of countries to 39. For instance, all ASEAN member countries waive visas for each other.

Vietnam's hotel sector has also seen strong gains.

In the first five months of the year occupancy was up 13.2% year-on-year and RevPAR, or revenue per available room, rose by 16.5%, global hotel operator IHG Hotels & Resorts said in a recent report.

"We've seen a 47% increase in leisure travelers from China, and a 10% year-on-year increase in long lead business for IHG."

Damien Pfirsch, chief commercial officer at Agoda, suggested Thailand should invest more in infrastructure that connects tourists to second-tier cities, offering new experiences beyond Bangkok and Phuket, as many travelers have already visited Thailand multiple times, according to Bangkok Post.

Thanet Supornsahasrungsi, president of the Association of Chon Buri Tourism Federation, warned that Vietnam could surpass Thailand in tourist arrivals within the next two to three years, VNA reported.

He pointed out that Vietnam's appeal lies in its low cost of living, new resorts and entertainment facilities, competitive pricing, and especially all-inclusive hotel packages that are about half the price of those in Thailand.