In 2025, Thailand’s tourism sector experienced its first decline since the pandemic, hindered by various setbacks that eroded traveler confidence.
The Tourism Authority of Thailand revised its 2025 forecast to just 33 million arrivals, marking a halt in the upward trend seen from 2021 to 2024, when visitors increased from 430,000 to 35.5 million.
With a new government anticipated following the general election, industry stakeholders are hopeful that tourism will once again be prioritized, reaffirming its importance as a vital driver of Thailand’s economy.
UNFULFILLED PROMISES
Earlier in 2025, the government led by the Pheu Thai Party aimed to revive tourist numbers to pre-pandemic levels, launching the “Amazing Thailand Grand Tourism and Sports Year” campaign to attract 39 million visitors and generate 3.5 trillion baht in revenue.
However, several events dampened these ambitions. Airlines reduced capacity due to sluggish demand, influenced by incidents such as the kidnapping scandal involving Chinese actor Wang Xing, who was lured from Thailand to a scam operation in Myanmar. This incident sent shockwaves through the Chinese market, leading to a sharp decline in bookings from Q1 through the end of the year.
In March, Bangkok was struck by an earthquake that caused the collapse of the State Audit Office building, further shaking tourist confidence after alarming videos circulated online.
Although previous efforts aimed to position Thailand as a regional hub for festivals, such as the Maha Songkran World Water Festival, and to host major events like Asia’s first Tomorrow Land electronic music festival between 2026 and 2030, these initiatives had limited industry impact.
The “Tiew Thai Khon La Khrueng” subsidy program for local travelers was introduced during the low season but was heavily criticized for its unreliable and cumbersome system, leading many hotels to opt out.
Global tourism also slowed down due to US tariff hikes, ongoing trade tensions with China, and disruptions caused by the Israel-Hamas conflict in the Middle East mid-year. The Thailand-Cambodia border conflict in June further damaged tourism prospects, especially in the eastern provinces.
Political turmoil, including the removal of former Prime Minister Paetongtarn Shinawatra over leaked conversations with Cambodian Senate President Hun Sen, disrupted tourism stimulus measures like free domestic flights for foreign visitors. Additionally, attempts to legalize casinos in entertainment complexes were rejected, adding to the sector’s challenges.
RISING COMPETITION
Thailand faced increasing competition from neighboring countries like Vietnam, Japan, and China. Chai Arunanondchai, president of the Tourism Council of Thailand, noted that 2025 underscored how vulnerable tourism is to unpredictable external factors.
Looking ahead to 2026, if unforeseen events are avoided, industry experts expect arrivals to rebound to at least 35.5 million, comparable to 2024 levels, supported by upcoming flights, events, and marketing initiatives already in place.
Despite a caretaker government, Chai emphasized the importance of restoring regional stability and addressing the impacts of flooding on affected provinces. He also acknowledged that tourism operators may have to wait for significant stimulus programs until after the formation of a new government, potentially missing opportunities in the meantime.
He urged the new administration to prioritize tourism and economic growth, increasing spending by domestic travelers. Infrastructure development, including high-speed rail systems, new airports, and man-made attractions, should be focal points to boost Thailand’s competitive edge.
A report from SiteMinder, a hotel revenue and guest acquisition platform, projects Thailand will remain among Asia-Pacific’s top 10 preferred destinations in 2026 alongside Singapore, India, Indonesia, China, and Australia.
Supakrit Phansomboon, SiteMinder’s country manager for Thailand, stressed the importance of highlighting Thailand’s strengths in gastronomy, hospitality, and wellness tourism while advancing infrastructure to stay competitive.
He also noted that the sector has moved past the initial wave of pent-up demand, where hotels could increase room rates by 20–30%. Going forward, operators need to adopt dynamic pricing strategies tailored to specific markets and destinations to optimize revenue.