Thailand’s recent clampdown on its largest “zero dollar tour”operation network is causing a drop in Chinese tourists just as the Chinese Golden Week holidays began on October 1st.
The operation which has been providing cheap package tours has been raided by Thai police. Since the clampdown began in August, over 2,000 tour buses were seized, about 40% of the total in Thailand.
Thai officials believe that if action is not taken the number of Chinese tourists will reach ten million. Also many payments are made under- the- table so taxes cannot be collected.
Zero-dollar tours are offered at below cost, and the operators make their profits from payments from souvenir shops and other service providers where tourists are given limited choices and often overcharged.
Thai officials believe that if these tours were stopped, increase in tax revenue would rise between 10 and 30%.
With tourism being one of the few areas where the Thai economy is expanding, the auithorities are keen to profit from this. One measure that is being considered is a minimum tour rate of 1000 baht per day after airfares for Chinese tourists.
The two countries signed a memorandum of understanding on Sept. 21, and Thai officials will visit China in mid-October to discuss new measures and meet local operators.
China has also been cracking down on rogue operators. Legislation three years ago bans unrealistically cheap tours that involve illegitimate gains such as rebates by arranging shopping or providing tourism services that require additional payment.Unless there is a mutual agreement with tour customers, agencies are not permitted to designate specific shopping places, or provide tourism services that would involve an additional payment.
Tourists also have some protection.
If they meet any kind of shopping arrangements that contravene the law, they may request a full refund within 30 days of their return, and agents are compelled to comply.
Zero-dollar tourism in Thailand goes back a long time but now that the increase in Chinese tourists has reached 18% of total arrivals, action has to be taken.
The government is predicting 9.7 million arrivals from China this year, slightly below the original target.
Industry watchdogs hope the reforms will last, but legislation on minimum spending is not expected before mid-2017.
China is aware that it has so far failed to eliminate the cheap tour scams. Just before the national holiday season on Sept. 27, the China National Tourism Administration issued a statement to tourists, and warned against rogue operators.
Chinese tourists have also been warned to behave themselves properly and protect the environment. It called on citizens to respect local laws, public order, local customs and habits, cultural traditions and religious beliefs.
Beijing has recently become more sensitive to image damage from widespread complaints about the behaviour of Chinese tourists abroad. As with the tour scams, these problems take time to eradicate.
(With thanks to Nikkei Publications)