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B5bn ‘Phuket recovery fund’ sought, as 80% of island businesses fight to survive

B5bn ‘Phuket recovery fund’ sought, as 80% of island businesses fight to survive

PHUKET: Phuket Tourism Council President Thanet Tantipiriyakit has appealed for the government to set up a B5 billion ‘recovery fund’ for Phuket businesses without cash flow and mired in debt so they can start operating again in order to help support the Phuket Sandbox scheme.

By The Phuket News

Monday 23 August 2021, 04:15PM

The setting up of such a fund will allow business operators who have been unable to secure any funding from the host of projects launched by the central government to finally be able to reopen, and restart Phuket’s tourism industry, Mr Thanet told Deputy Prime Minister Supattanapong Punmeechaow during a video conference on Saturday (Aug 21).

Present for the conference call were Phuket Governor Narong Woonciew along with key members of the Phuket Communicable Disease Committee, leading tourism business figures and heads of local municipalities, including mayors, of key tourism areas across Phuket.

The recovery fund is necessary to support any further growth in the Phuket Sandbox scheme, which so far has seen 23,700 people arrive in Thailand via Phuket, Mr Thanet explained.

“During the video conference meeting with Deputy Prime Minister Supattanapong Punmeechaow, we presented to him the idea of setting up a fund to help Phuket’s tourism industry to recover, so that the Phuket Sandbox scheme can continue,” he said. 

“To continue the scheme, access to funds is the most important thing, especially for small and medium-sized enterprises (SMEs) that provide transport or spa services. They cannot access any funding from the government,” he said.

“We can see that only B10bn, or about 4%, has already been borrowed from the existing ‘recovery fund’, which was set up with B250 billion ‒ 4% is very low,” Mr Thanet highlighted.

“So if we want to continue the Sandbox scheme, operators must be able to actually access funds to help them solve their problems. Many operators do not meet the criteria set out by the government because they are already in debt and are unable to show any cash flow in their bank statements. Some operators have a very high amount of debt or are having great difficulty obtaining permission to re-open,” he said. 

“We, the private sector, want to push to have a fund to help our SMEs. Initially, we will divide business operators into three groups. The first group is small hotel operators who may not have permission to re-open, so they can get the money to develop their business so they can legally re-open,” Mr Thanet explained.

“The second group is transport operators, for both land and sea, as we all know that taxi operators are struggling with negotiations with banks. The fund may help them very well,” he said.

“The last group is manufacturers who supply products used in hotels, spa operators and other operators in the tourism industry,” he added.

“We have a concept for the Phuket Sandbox scheme, which is ‘Phuket Happy for All’. Every person must be happy, so I want to see the fund develop our community tourism, local products and new tourist attractions. I want to see the fund spent on solving the problems that are affecting the success of the Phuket Sandbox project,” Mr Thanet noted.

“To get the fund set up, we have some ideas. It could be a loan from the Bank of Thailand or it could be in the form of a ‘Phuket bond’ created for investors. Or we may need to have an entry fee for some natural tourist attractions, or it could be a combination of these ideas.

“I believe that the Deputy PM [Mr Supattanapong, who also currently serves as the Minister for Energy] is very good at business management, so he must have some good ideas and suggestions. We may have the Ministry of Tourism and Sports and other relevant ministries to buy our [‘Phuket’] bond to launch the initial fund,” he added.

“In our most recent meeting between officials and businesses from the private sector, through research we found that Phuket needs a fund of about B3bn to help operators, so [to look beyond that] we hope to have a fund set up of about B5bn,” Mr Thanet said.

“We really need the fund to help businesses on the island recover because right now over 80% of all businesses on the island are continually opening and then closing again. If we do not have a fund to keep businesses operating, they may need to shut down permanently,” he noted.

“From our research, such operators are the majority on the island. We have about 270,000 employees and operators in our system [Phuket Tourism Council], representing about 71% of all tourism industry businesses on the island. If this group cannot get help, it will be even worse for the island,” he said.

“Right now, we can see the [positive] movement for only about 20% of businesses on the island. For the island to recover, we not only need to have tourists, but operators must also be ready to serve them. Capital is critical at this stage, and if the fund can be set up very quickly, businesses in Phuket will be able to get better and recover,” he said.

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Foot | 24 August 2021 - 09:56:00

Do not put any more money into tourism until the population is vaccinated with an effective vaccine.  Regular Thais and Burmese get Sinovac which is about 50% effective, which mean 1/2 aren't protected. Keep island closed until everyone has been effectively jabbed. Then start procedures to rebuild tourism.

Kurt | 24 August 2021 - 08:28:30

Why have some operators have great difficulty obtaining permission to re-open? Answer: the always present not needed nonsense 
Government bureaucracy! Don't they see, never learn, that Thai bureaucracy just costs a lot of money? It kills, it blocks development. It's very destructive.

Kurt | 24 August 2021 - 08:16:37

At this moment and near future there are enough operators to serve the needed tourists as long the Phuket Sandbox 'straightjacket' policy continues. Anyway, let 'market mechanism' work. When more 'tourists' are coming, more operators restart. Entry fee for some natural tourist attractions? Yeah! Sell tickets (dual pricing of course) for entering beaches.

Christy Sweet | 23 August 2021 - 21:22:54

Or.. divest from tourism which is an unsustainable economy in every way- bad for pretty much all living things. Pollution from plane travel, neighborhoods turned into 4 lane highways, etc etc. Change now or suffer the consequences of reliance on it longer. There will be more pandemics and  other catastrophes we can not even think of yet. 

JSombra | 23 August 2021 - 19:37:07

What a strange selection to 'help', first illegal hotels, then taxi drivers who have zero costs to reopen and no staff and lastly everyone else..

Fascinated | 23 August 2021 - 18:57:01

Stuff the taxis and tuk tuks- they deserve no support or sympathy until the reform and charge realistic rates for their services. One benefit of COVID has been all the parked up tuk tuks and minibuses. the ones back on the road are very aggressive towards people and deserve nothing. I was followed down the street by one the other day and it was not a pleasant experience.

Kurt | 23 August 2021 - 17:18:25

Half the time Phuket officialdom doesn't know what it is doing, not disturbed by any thinking ability. Just flip-flopping.  Throwing billions in a passive loser named 'Sinkhole Sandbox' ? Madness.

Kurt | 23 August 2021 - 16:57:28

@Jamstock, when almost everyone on Phuket got vaccinated, as you wrote, why Officialdom stubborn continues in a Sandbox model what brought and keeps many entrepreneurs (80%) to/in the drain  + many lost staff jobs? And now a B5bn transfusion? For what, whit the present Sandbox continuing? It are not foreign tourists, quality vaccinated, that cause the spiking Covid figures here.


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