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While the U.S. and European countries have imposed sanctions on Russia over the invasion of Ukraine, Southeast Asian nations are improving their ties with Russia to address their economic problems. Countries like Thailand hope for more Russian tourist arrivals this year, to hasten the recovery from the impact of the Covid-19 pandemic.
Thailand just recently announced the resumption of regular flights by Russian flag carrier Aeroflot between Moscow and Phuket at the end of October. The resumption of the Aeroflot service will benefit Thai tourism. Before the Pandemic, Thailand saw a substantial rise in visitors from Russia, namely a 67,8% increase between 2015 and 2019.
Phuket in particular, the country’s largest island, depends on Russian tourists. In fact, Phuket runs on tourism dollars and tourism before the pandemic accounted for 80% of the island’s economy and over 300,000 jobs, as per provincial Governor Narong Woonciew. A large segment of tourists to Phuket arrives from Russia. According to data from Thailand’s ministry of tourism and sports, Russia accounted for 17% of international arrivals in Phuket in January 2022. With around 24,000 tourists, Russia made up the largest group among the 133,000 international tourists in Phuket.
Challenges for Thai tourism
The route between Moscow and Thailand was closed after the invasion of Ukraine. However, some 76,000 Russian tourists visited Thailand this year until July. And as Thailand further eased travel restrictions, 3.78 million tourists again entered the country between January and August 17. Most of these arrivals from India, Singapore and Malaysia generated revenues worth 176 bn baht ($4.93 bn), Taweesin Visanuyothin, a spokesperson for the Thai government’s Covid-19 taskforce said. The government hopes to attract up to 10 million foreign tourists this year.
According to official Thai statistics, though the numbers of Russian tourist arrivals have exceeded those during the whole of 2021, they are still very few compared to the pre-pandemic volumes when roughly 1.5 mn Russians visited the country annually. Forecasts by several travel market experts say Thailand will receive a maximum of 250.000 Russian tourists by the end of 2022. As per Association of Tour Operators of Russia, about 100,000 Russians are expected to arrive on connecting flights, while another 20,000 tourists will arrive on Aeroflot flights.
Meanwhile, Thailand plans to extend the period of its visa-on-arrival, which is applicable to Indian, Chinese and Saudi Arabian nationals, from 15 days to 30 days from October with the aim of boosting the tourism sector further.
In 2021, the number of foreign arrivals dropped to 428,000 owing to pandemic-induced restrictions, compared to a record of 40 million in 2019, which contributed to roughly 12% of the country’s GDP.
Thailand – Russia trade ties
On a different note, Thailand and Russia have agreed to expand bilateral trade aims. They expect bilateral trade to hit $10 bn in 2023, which is four times compared to the figures in 2021. Thailand chairs the Asia-Pacific Economic Cooperation summit this year. The country exports cars and food to Russia while importing crude oil and fertilizer.
According to the Observatory of Economic Complexity (OEC), the exports of Russia to Thailand have increased from $1.11 bn in 1995 to $1.4 bn in 2020.
