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23 Apr, 2014

Hotel group COO: Why no travel advisories against U.S.?

BANGKOK – The COO of the Bangkok-based Minor Hotel Group, owner/operator of more than 100 hotels across Thailand and the Asia-Pacific, has demanded to know why there are no travel advisories against the United States in spite of the numerous shootings in its public places.

In remarks during a panel discussion at the Thailand Travel Forum organised in Bangkok on  21 April, Mr. Dillip Rajakarier voiced frustration with the way travel advisories are imposed against countries such as Thailand during periods of social and political unrest.

The Sri Lankan-born COO said there had been violence in a Chinese city recently, but no travel advisories were imposed. He added, “Look at the U.S., there are people dying every day. People are being killed. Children are being shot. So why are there are no advisories?”

He said the same thing was prevalent over Songkran, the Thai New Year holiday, when more people died due to road accidents than were killed during the entire period of political unrest.

The remarks reflected a growing industry anger with the entire travel advisory system, the lack of transparency over how it is applied and the lack of accountability over apparent double standards under which advisories only seem to be prominently issued by the so-called “developed countries” against the developing countries.

Travel advisories and media coverage of the recent political unrest in Thailand were cited by a number of speakers during the panel discussions as being responsible for exacerbating the decline in visitor arrivals.

Both are inter-related. Most travel advisories are based on both local and foreign media coverage. When governments such as the United States, UK and Australia impose travel advisories, they have a ripple-effect impact on insurance coverage and automatically become a major decision-making factor for consumers surveying potential holiday destinations.

Thailand and other Asian, African and Middle East countries have for years been hit by travel advisories, but Mr. Rajakarier’s comment was the first public expression of frustration at the double standards and the need to put the travel advisories into proper perspective.

The fact that the remarks were made in a travel forum organised by the American Chamber of Commerce in Thailand made them more relevant. Although Mr. Rajakarier did not feel constrained by political correctness, his questions went unanswered because the expatriate-dominated forum became a one-way monologue, devoid of opportunities to pose questions or comments from the floor during the entire two hours.

The American Chamber organised the event supposedly in order to present “solutions” to the Thai tourism industry as part of the post-crisis recovery efforts. However, if U.S. government advisories are seen as a part of the problem, it puts the onus on the American Chamber to seek solutions first by taking up the problem with its own government rather than extending any advice on “solutions” to the Thai government.

Also noteworthy is the fact that the Minor International Group is owned by a long-time resident of Thailand, American businessman William Heinecke. The group also includes a number of hotels managed by the Marriott, arguably the most prominent of the U.S. hotel chains.

These links make Mr. Rajakarier’s remarks all the more courageous and well deserving of further traction industry-wide.

The U.S. government is facing increasing global accountability for its actions, especially those which have a direct impact on jobs, economies and livelihoods in developing countries. One of the hallmarks of the new emerging world order is that accountability is becoming a two-way street based on the growing conviction that the U.S. government should not do unto others what it does not wish done unto it.

Mr. Rajakarier’s remarks have put that process of accountability into high gear.

The rest of the Thailand Travel Forum did not unearth anything new beyond the already well-known trends, such as:

(+) Hotel occupancies in Bangkok hit historic lows during the height of the political crisis; however upcountry hotels have been doing well.

(+) A lot of business was saved thanks to the increased aviation access, especially low-cost airlines to the beach resorts of Phuket and Samui. The high-end of the business was considerably affected across the board.

(+) The Dusit Thani hotel has confirmed contract terminations of many of its expatriate staff as part of the cost-cutting efforts. None of the Thai staff have been let go although they have been encouraged to take some leave during this period.

(+) Defying widespread predictions, there has been no price war. Although hotel occupancies are down, rates have remained steady as hoteliers now believe that “if people are scared, they will not be coming any way, and dropping the rates is not going to make any difference.”

(+) Although the relative peace and stability in Bangkok is now seeing the visitors upturn again, and hoteliers have confidence in Thailand’s resilience, there is considerable uncertainty over what Mr. Charles Blocker, head of the American Chamber’s Tourism committee called “the succession planning” issue facing Thailand at large. Unless that is sorted out, it will continue to see a cloud of uncertainty hanging over the country.

Relevant copies of the presentations providing valuable statistics on hotel performance during the crisis period are available by clicking on the links below:

Hotel Market Recap 2013 –  – Jesper Palmqvist

Investment & Thailand Hotel Transaction Market UpdateNihat Ercan

Arrival of REITs in 2014 –  – Sorachon Boonsong

Fearless Forecast – 5 Predictions for 2014 – – Charles Blocker