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3 Apr, 2006

Laos Visitor Arrivals Cross the One Million Mark

Visitor arrivals to Laos crossed the one million mark in 2005, with Thais accounting for more than 60%, according to detailed arrival figures released last week by the Lao National Tourism Administration.

The total arrivals of 1,095,315 included 603,189 Thais, well ahead of Vietnam which came in second at 165,151 visitors. This was followed by the US (47,427), China (39,210) and France (35,371).

The Mitthaphab (Friendship) bridge, built with Australian funding and opened in 1994, is now by far the most important international checkpoint, with 541,016 arrivals, dwarfing the 105,533 arrivals at Wattay international airport in Vientiane.

A detailed report on visitor statistics was distributed to participants at a Mekong Tourism Investment Summit in Luang Prabang last week. By adopting the Thai methodology for compiling and reporting visitor arrivals, Laos has provided rare insights into its rapidly growing tourism industry, thus better equipping potential investors with data for planning future projects.

For landlocked Laos, roads and highways are by far the most important means of transport. Although the country has gained foreign aid for upgrading its two international airports at Vientiane and Luang Prabang, the vast majority of visitors are streaming through its six overland border checkpoints with Thailand, five with Vietnam and one with China.

This shows the importance of projects like the Asian Highway for boosting intra-regional tourism. Although low cost airlines are revolutionising air travel and considered the ‘sexier’ means of transport within Asia, the long-term potential clearly lies with road travel.

Indeed, Laotian arrivals by mode of transport have shifted dramatically from 80:20 air:land in 2002 to 40:60 in 2005, according to the report.

After the Friendship Bridge, the second most important land border is Dan Savanh (Savannakhet) with 135,686 visitors in 2005, followed by Vang Tao (Pakse) with 95,325 and Houei Xay, 59,613. All are on the border with Thailand.

Between 2001 to 2005, arrivals at the Friendship Bridge surged from 355,192 to 541,016; at Vang Tao from 27,290 to 95,325 and at Houei Xay from 40,534 to 59,613.

However, Luang Prabang has also benefitted from the airport improvements and the increased interest by airlines like Bangkok Airways; it has reported the highest arrivals growth from a paltry 3,945 visitors as the first point of entry in 2001 to 33,064 in 2005.

To its credit, Laos is being totally transparent with its statistics and coming clean with the methodology in order not to give the impression that it is misleading analysts with figures that are deliberately inflated, as many countries are prone to do.

The preamble to the arrivals notes that visitors making “visa runs” from Thailand as well as border-crossing day-trippers are included in the figures. It says:

“From 1991 to 2002, there was a type of tourists called “Tourists for Visa Extension” who were temporary workers in Thailand crossing over to Laos to extend their three-month visas before re-entering Thailand. These tourists are mainly from India, Pakistan, Sri Lanka, Nepal and Bangladesh. However, from 2003, this type of tourist has been reclassified as ‘international tourists’.

“Tourists from neighbouring countries such as Thailand, China, Myanmar, Vietnam and Cambodia, which enter Laos with valid border passes or passports are also included. Although some of them are called “day trippers” they may make overnight stays.”

Technically, under the global definition, a “tourist” is one who spends at least 24 hours in a country.

The arrivals report contained a number of interesting trends:

<> As the country progresses economically, an outbound market is emerging. Laos recorded 932,099 outbound travellers in 2005, up from 596,572 in 2003. Although the vast majority were day-trippers holding border passes, there were significant numbers of travellers for business.

<> Of the total arrivals, only 33,810 used the services of Lao travel agents, down from 46,317 in 2004.

<> Inspite of the large growth in arrivals , average hotel occupancy has grown only from 45% in 2003 to 50% in 2005. Although higher levels of growth have been recorded for key provinces like Luang Prabang and Vientiane, this figure proves that the vast majority of arrivals are day-trippers who don’t use local accommodation.

<> The number of hotels has risen from 148 in 2004 to 165 in 2005. However, the number of guesthouses has grown more strongly from 809 to 923 in the same period. Total number of rooms is up from 5,544 in 335 establishments in 1999 to 15,828 rooms in 1,088 establishments in 2005.

<> The industry earned foreign exchange revenues of US$ 146 million in 2005, up from 113 million in 2002. It has been the top exchange earner every year since 2000, except in 2003 when it fell to Number two position after electricity, due to the slowdown caused by the Iraq war and the SARS crisis.

By 2010, Laos is targetting two million arrivals, generating US$ 290 million.

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