Leisure travel is bouncing back in parts of Asia but risks remain, says hotelier

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Locals and tourists attend an event organized to mark the opening of Phuket to international tourists on Patong beach.

Thomas De Cian | NurPhoto | Getty Images

The darkest days for the tourism industry may soon be over, according to the chairman of a multinational hospitality firm.

Tourist hotspots like Phuket are now open to international tourists who don’t have to quarantine, and others like Koh Samui are following suit, pointed out William Heinecke, CEO of Minor International, which runs a chain of hotels and restaurants worldwide.

The Thai government recently announced a “sandbox scheme” for Phuket, saying the popular resort island will be open, quarantine-free to vaccinated Thai and foreign travelers from July 1. Koh Samui, Thailand’s second largest island also became accessible to tourists from July 15 under the same rules.

Tourists can move around both islands freely and leave for other cities in Thailand after staying in Phuket or Samui for 14 days.

“I think we’re already seeing the results of that (sandbox) with people coming in … Phuket has been doing it effectively since July 1,” with a rising number of tourists each day, he told CNBC’s “Street Signs” last week.

Strong rebound in Europe, China

Minor International, which runs more than 530 hotels, resorts and serviced suites worldwide, is also seeing a strong recovery in Europe, the Middle East and China, Heinecke said, pointing out that some regions have returned to pre-Covid levels or higher.

Hotels are also seeing a strong demand in room types with higher pricing room types — such as villas, suites and deluxe rooms — being taken up before regular rooms.

“In Europe, where we just reopened, we’re seeing very strong demand. We’ve seen very steady recovery since January in the Middle East… our Middle East properties are now functioning at pre-Covid levels. We have many countries in the world that are in pre-Covid levels or higher. China is another one,” he added.

One of the trends for sure that we see is much more focus on wellness and immunity and people concerned about their health.

William Heinecke

CEO and Chairman, Minor International

Heinecke also noted the change in consumer behavior when it comes to tourism during the pandemic, and added that his company is taking advantage of it by offering more programs focused on wellness.

“One of the trends for sure that we see is much more focus on wellness and immunity, and people concerned about their health,” he added.

Risks to outlook

While demand for tourism has rebounded in parts of the world and recovery has been strong, the rate of vaccine rollouts in Asia has been a concern.

“We see still slowness in many markets brought on by problems with (vaccine) production,” Heinecke said, naming slow progress in Malaysia and the Philippines.

That’s “partly because of the AstraZeneca manufacturing in Thailand,” he added.

Thailand started producing Covid-19 vaccines for British-Swedish drugmaker AstraZeneca in June. Its local partner Siam Bioscience, owned by King Maha Vajiralongkorn, is set to produce 180 million doses this year — with more than one-third for Thailand and two-thirds for Taiwan and Southeast Asian countries including Malaysia and the Philippines. 

However, there were reports last week that Thailand may curb exports of its locally produced AstraZeneca vaccines to fight its own crisis.

According to Our World in Data, Asia is far behind North America, Europe and even behind South America when it comes to vaccine doses administered per 100 people. North America is administering about 78 doses per 100 people, while Asia trails behind at 49 doses, according to data on July 17.

Slow vaccinations are leading to rising cases, even as the highly transmissible delta variant first discovered in India has become the dominant strain in the United States, spreading to at least 104 countries.

From Singapore to Thailand and Australia, there have been restrictions and lockdowns, and travel corridors between cities and countries have been called off, putting a damper on the tourism industry’s comeback in 2021.

The availability of vaccines is critical, said Heinecke. “I believe in more vaccination, less lockdown,” he said.



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