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As tourism industry recovers, all eyes are on China

As tourism industry recovers, all eyes are on China

PHUKET: According to C9 Hotelworks new Phuket Hotel Market Update 2023, the resort island’s tourism recovery has accelerated over the past six months. With the removal of Thailand’s pandemic travel restrictions in 2022, airlift quickly ramped up as India and Malaysia were key early source markets.

By The Phuket News

Monday 20 March 2023, 03:56PM

Over the current winter season aside from the return of the traditional ‘snowbird’ market from Northern Europe and Scandinavia, an influx of Eastern European travelers including those from Russia has spiked demand. Room rates have soared and average stay (ALOS) increased, reported Bill Barnett, Managing Director, C9 Hotelworks.

“Looking ahead at the remainder of 2023, we are looking at a balanced recovery led by the Chinese market. For China, July and August along with National Day holidays in October look to play into a methodical build-up of traffic as airlift returns,” he said.

“We expect a return to 2019 trading by the year-end of this year and the start of a new tourism cycle in 2024,” Mr Barnett added.

Robust numbers in Q4 last year set the stage for tourism recovery by the end of 2023 and island flight arrivals FY2022 have ramped up by 210% year-on year [y-o-y], he added.

"Phuket has experienced a profound tourism surge since COVID entry restrictions were lifted on October 1, 2022. Passenger arrivals elevated to 3.9 million in 2022, up from 1 million in 2021 and 2 .5 million in 2020.” Mr Barnett said.

“Although 2022 figures were lower-than-expected due to the Russia-Ukraine conflict and closed borders in China, C9’s analysis of passenger arrival trends over the post 10 years points to a return to cyclical upward growth, which is widely demonstrated in ongoing room night demand in 2023,” Mr Barnett explained.

Rising international flight arrivals consistently grew as island-wide hotel occupancy averaged 48% in FY2022, he noted in C9 Hotelworks’ Phuket Hotel Market Update 2023 released late last week.

“This is compared to 8% in FY2021, when there was a sole reliance on the domestic sector. Last year the market-wide average rate pushed up by 80% y-o-y, to B3,942,” he said.

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“Conversion and rebranding activity highlights an active trend by hotel owners with many opting to transition from hotel management agreements to franchise models,” he noted.

“Looking forward, we expect that leisure demand from the FIT and Group segments will continue to be strong. As the resort island moves out of its seasonal winter peak, all eyes are on China. The industry recovery outlook can best be summed up as ’it’s not a matter of will it happen, but how long will it take to regain critical mass,” Mr Barnett concluded.

The report also marked in its summary section:


  • India, Singapore and Malaysia pushed to the Top 5 Source Markets in the post summer, while a seasonal spike from Europe and Russia kicked in during the winter.
  • China Southern Airlines, China Eastern Airlines, and Air China hove resumed their operations in Phuket from Beijing, Shanghai and Guangzhou
  • Luxury and upper upscale hotels led all tiers’ market performance reflecting a top-down market recovery.


  • Phuket International Airport Expansion Phase II is under progress and will be completed by 2027 . It’s target capacity is 1 8 million passengers per year and 25 flights per hour.
  • Phuket’s incoming hotel pipeline has been severely impacted by the lock of financing from Thai lenders, resulting in many projects remaining on hold.
  • Hotel staff shortages have continued to plague the industry throughout the pandemic recovery period and is expected to continue.


To read and download the full report click here.

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