Thailand gives more bang for your baht

Click to follow
The Independent Online
If exploiting a nation's plummeting economy sounds like your idea of a holiday this year, try Thailand. There's sun, beaches, ancient culture - and a currency which in the past few weeks has lost 25 per cent of its value, making beleaguered Thailand a bargain destination for British tourists spending hard cash.

With prices in five-star resorts hitting all-time lows, researchers at the government-run Tourism Authority in Bangkok are predicting an influx of British tourists during the summer months.

Holidaymakers are expected to take advantage of low-priced deals springing from a surging British pound coupled with Thailand's deepening economic malaise.

The embattled Thai baht tumbled on the international currency exchanges last month, prompting the government to hand economic control to the International Monetary Fund.

"By the next tourist season in November, I think prices for tours and hotels will have caught up with the fall in the value of the baht," said Tip Wontatikin, a senior analyst at the Tourism Authority of Thailand. "But right now we're in a sort of strange price limbo which is working to the advantage of foreigners."

The wide stretches of palm fringed sands, exotic ambience and reputation for tolerance and relaxation have long been the mainstays of Thailand's lucrative tourism industry, which attracts more than a quarter of a million Britons each year.

But the luxurious hotels and beach resorts, the throbbing night life in the Thai capital Bangkok, and the inspiring jungle treks to remote temple ruins all come at a price which, though hardly extortionate by European standards, could prove hardly cheap either.

Those with hard currency from outside Thailand are now gaining significantly from the baht devaluation.

But a particularly strong British pound, which has risen inexorably from a rate of 38 bahts last year to a compelling 54 bahts today, is undoubtedly the currency of choice for holiday bargain hunters.

Strolling through the sweltering night markets of Bangkok's bustling Central Business District, cheap deals abound. Hotels and resorts priced before the baht devaluation are also offering substantial savings, most strikingly at establishments at the top of the country's tourism industry.

Take the Oriental Hotel, for instance, sitting astride the exotic Chao Praya river which winds through central Bangkok. Prices for exclusive rooms overlooking the river have dropped by pounds 40 a night in the past three weeks, the direct impact of a strong pound against a weak baht.

"We've seen our intake of guests from Britain increase significantly over the past month," said Melvin Robson, manager of the Oriental.

"A feel-good factor in Britain is certainly a factor, but mostly people are taking advantage of our pricing, which we are continuing to quote in Thai baht. At least for the moment," he added, hinting that new dollar rates may soon return the hotel's tariffs to their previous level of exclusivity.

Plunged into steep decline after an unprecedented two decades of dramatic growth, Thailand's overheated "Asian tiger" economy has been in free fall since last year.

However, the sense of crisis heightened last month, when costly efforts failed to defend the baht from market speculators, and the Thai government was forced to float the embattled currency.

But according to economists, Thailand is likely to undergo further painful economic contraction before its fortunes will pick up.

And the outlook is particularly bad for the troubled baht, which could fall another 25 per cent over the coming year, according to a "conservative" estimate from the accountants Goldman Sachs in Bangkok.

All this means hardship for the average working Thai, who is already watching resentfully as fuel prices sky-rocket while wages stay low.

To add insult to injury, Thais can now look forward to seeing enriched tourists and expatriates enjoying lifestyles which are increasingly unattainable for themselves.

What your pound buys

Item 1996 1997

Beer pounds 2 pounds 1.30

Fake Rolex pounds 25 pounds 15

Room at Oriental pounds 155 pounds 114

Thai silk PJ's pounds 145 pounds 101

Diving course pounds 263 pounds 185

Laptop computer pounds 1,400 pounds 985