A tourist sits on a hammock on a beach in Thailand.
© Marco Buttigielli | moment | Getty Images
Come Monday, Thailand will lift quarantine restrictions for travelers from more than 40 countries – even though less than half of its population has been fully vaccinated against Covid-19.
As of October 27, only about 42% of Thailand’s entire population has been vaccinated against Covid-19, according to Our World in Data. In comparison, other countries in the region such as Cambodia, Malaysia and Singapore have more than 70% of their population fully immune to Covid.
The three Southeast Asian countries, plus Australia and China, are on Thailand’s list of approved countries, as the country prepares to reopen its doors to tourists on November 1.
Following the announcement last week, Bank of America economists said it was good news for Thailand’s tourism sector, economic recovery and currency – but noted that it was “not without risks”.
“Despite impressive vaccination efforts, full vaccination remains relatively low and uneven,” the economists said. “As is evident in other countries, the vaccination rate is too low to prevent outbreaks, especially with the delta variant.”
However, they said the shutdown is not expected given the country’s high risk tolerance, unless the country’s intensive care unit capacity becomes overwhelmed.
Due to the uneven vaccination rate across the country, the available data may not clearly reflect vaccination levels in places like the capital, Bangkok. The deputy governor of the Bangkok Metropolitan Administration recently told Singapore-based media that 75% of its population has already been vaccinated with the second dose.
The importance of tourism in Thailand
Among the region’s economies, Thailand is one of the “most dependent” countries on tourism, with the sector accounting for about 21% of GDP in 2019, according to Sian Viner of Oxford Economics.
“The travel restrictions have come at a huge economic and social cost and have been a major reason why Thailand’s economic recovery has lagged behind many of its peers in the region,” said Viner, chief Asia economist at the global consulting firm.
Thailand’s economy grew 7.5% year-on-year in the second quarter, according to government data. This level of growth fell behind other regional economies such as Malaysia, Singapore and the Philippines which grew between 11.8% and 16.1%.
Oxford Economics predicts full-year GDP growth of 1.8% in Thailand this year.
However, the return of international travelers is not expected to be immediate because visitors may still face quarantine requirements in their home countries, according to economists.
“We expect inbound tourism to rebound in 2022, but until then we still expect international arrivals to be about 66% lower than 2019 levels,” Wiener said. “In fact, we do not expect a full recovery in domestic travel to pre-Covid levels until 2025.”
Meanwhile, economists at Bank of America highlighted that Chinese tourists – who made up about a quarter of Thai tourist arrivals in 2019 – are not expected to return until the second half of 2022.
China has largely closed its borders to international travel since last year and continues to follow a strict strategy to combat the coronavirus, which has led to mass lockdowns even if few infections have been reported.
Other parts of Southeast Asia are also looking to reopen their borders to international visitors.
Singapore has announced travel itinerary arrangements with several countries including the United States and the United Kingdom, while Malaysia’s tourism minister told CNBC last week that the country may reopen its borders to international tourists in November.