The conflict between Israel and Iran has affected more than just the Middle East. Even the white beaches of Thailand are feeling the effects of the latest war today. Although news of the conflict ending soon broke on June 24, alarming warning signals are already coming from Thai tourism sector.
According to Thailand Hotel Association (THA) President Thienprasit Chaiyapatranun, the number of tourists from the US, Europe and the Middle East could fall by 10%, and in the worst case scenario – by as much as 20%. The blow will be especially noticeable in the summer, the peak season for Middle Eastern visitors seeking coolness in Thailand.
However, that’s not all. The blow to demand could have long lasting repercussions.
“Tourists from the Persian Gulf countries, as well as the US and Europe, are increasingly canceling their trips. Higher tariffs and rising prices caused by trade and foreign policies of US President Donald Trump have already affected purchasing power,” stated Deputy Director of Tourism Authority of Thailand Chirrawadee Khunsub.
This chaotic international situation contributes to rising oil prices, making flights more expensive. The Thai stock exchange already could not withstand the stress: shares dropped by 1.3%, reaching a minimum since March 2020, the time of the global COVID-19 pandemic crisis.
“The US involvement in the Israeli attack on Iranian forces has added to the global economic shock, thus forcing the Stock Exchange to introduce emergency measures,” local market analysts note.
While optimists hope that the conflict will end by October, which will lead to the resumption of tourism in the season, pessimists predict further escalation. A possible blockade of the Strait of Hormuz could push oil prices above $100 per barrel. This would trigger the collapse of several industries at once – from tourism to retail.
Meanwhile, Thailand offers vacations in more relaxed destinations such as Krabi, Samui and Chiang Rai. But while warning signs remain, the prognosis is bleak.
Tourism is a major economic contributor to the Kingdom of Thailand. Estimates of tourism revenue directly contributing to the GDP of 12 trillion baht range from one trillion baht 2.53 trillion baht, the equivalent of 9% to 17.7% of GDP.
Prior to the global COVID-19 pandemic, Thailand was ranked the world’s eighth most visited country by World Tourism rankings compiled by the United Nations World Tourism Organization. In 2019, Thailand received 39.8 million international tourists, ahead of the United Kingdom and Germany, and received fourth highest international tourism earning at 60.5 billion US dollars.
Following the COVID-19 pandemic, tourism rebounded to similar levels. In 2024, the number of international tourists was projected to be 39.8 million people. However, that year only attracted 35,55 international tourists.
