Discounts Abound as Tourism to Thailand Drops

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BANGKOK — Thai Airways is trying to lure passengers from outside Asia with free domestic flights. Hotels on the resort island of Phuket are offering a fourth night free. And mountain lodges up north are offering free golf and spa pampering.

Facing its worst crisis in years, Thailand's tourism industry is going to great lengths to drum up business that has plunged thanks to political upheaval, the global recession — and now swine flu fears.

Foreign traveler arrivals have fallen 16 percent so far this year, while hotel occupancy across the country has dropped to 44 percent, down from 66 percent last year. Luxury hotels in Bangkok have even lower occupancy rates.

"I don't see any positive factors," said Kongrit Hiranyakit, head of the Tourism Council of Thailand. "Oil prices are increasing, influenza is spreading all over the world. Political protests are bad for the country's image."

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He expects the tourism industry will lose about 200 billion baht ($5.6 billion), down by more than a third from about 540 billion baht last year.

To offset the drop-off in visitors from abroad, Thailand is promoting domestic tourism — and hotels are offering rock-bottom discounts to Thai residents. The government is extending a holiday next week to get Thais on the road. It has also cut airport landing fees and offered low-interest loans to small businesses catering to tourists.

But many fear recovery is a long way off for the industry that employs 2.5 million people and is a pillar of the economy, which has already slid into a recession.

So far, the slump has not led to big job losses, but many hotels have put employees on temporary leave without pay. Thai hotels and restaurants had 100,000 fewer seasonal workers in March than they did in February.

"There's been a push to hold on to people," said Dale Lawrence, communications director of the Bangkok-based Pacific Asian Travel Association. "Thailand has learned from past crises that if they let too many people go they are desperately short of trained people when the industry recovers."