Is the Tourism Authority of Thailand lying or telling the truth?  You decide.

I have always contended that the Tourism Authority of Thailand makes up its numbers of tourist arrivals.  This report from the MasterCard Worldwide Index of Global Destination Cities proves it.

Tourism Authority Of Thailand MasterCard

The MasterCard Worldwide Index of Global Destination Cities is an annual report forecasting tourist arrivals, expenditures, and growth.  The numbers posted by the MasterCard Worldwide Index of Global Destination Cities differ greatly from what the Tourism Authority of Thailand has stated.

According to the MasterCard report, Thailand’s tourist expenditures will grow 18.6% over the previous year in 2011.  This sounds good, but keep in mind that in 2010 there were riots in the streets of Bangkok for 2 months and every Embassy in the world warned travelers not to go to Bangkok.  There can only be an increase in 2011.

But, let’s take a look at who is beating out Bangkok in money spent:

Strong growth in expenditure is recorded in Asia/Pacific cities, with Singapore (23.9%), Hong Kong (23.6%), Tokyo (20.8%) and Taipei (20.3%) all featuring in the top ten destination cities, ahead of Melbourne (19%), Seoul (18.6%) and Bangkok (18.6%).

Tokyo’s number will surely be revised downward due to the earthquake and tsunami.  Thailand needs to learn from Singapore and Hong Kong.

Bangkok ranks fourth with visitor expenditures estimated at US$14.4 billion

Now time for some math.  If we use the MasterCard’s numbers, the 11.5 million visitors to Bangkok in 2011 will spend approximately $1,252 per person.  This number is low for a major metropolis like Bangkok.

Also – take a look at a couple of rising stars:

Chinese cities top Asia-Pacific on growth In the Asia/Pacific region, Beijing and Shanghai are in second and third ranks with visitor growth rates for 2011 estimated at 20.2% and 18.6% respectively, reflecting their rising attraction as China’s most important destination cities. Shanghai also ranks second regionally on visitor expenditure with growth rates of 24.3% for 2011. Beijing also ranks third in both number of visitors to Dubai and how much they spend there.

Laos and India will be added to this list in the near future with the progress they are making.

Dr. Hedrick-Wong said that many emerging market destination cities are showing robust growth with increases in both visitor arrival and cross-border expenditure, with many showing growth rates exceeding 20%.

Now, here is where the Tourism Authority of Thailand is making up numbers.  According to this article in The Nation, TAT says that the number of tourists projected for 2011 is 17.6 million.  Don’t believe it.

According to the MasterCard Report -

Cities in Asia/Pacific account for eight of the top twenty with Bangkok ranked third, projected to have 11.5 million visitors this year

That is quite a difference – about 6 million tourists different.  Who is telling the truth?  If I were a gambling man, I would bet the farm on the numbers put out by MasterCard.

Unlike the Tourism Authority of Thailand, MasterCard explains how it arrives at its data:

The MasterCard Worldwide Index of Global Destination Cities is compiled using international flight and flight capacity information purchased from OAG Global, a provider of international aviation data. Flight schedules are also used for calculating flight frequency between pairs of cities. Airlines also publish on a regular basis their historical load factor, and advance flight schedules, which are then used to estimate the actual outbound passenger departures, and for forecasting outbound passenger departures in the coming year.

On any given flight there are visitors from the departure country, returning residents of the destination city after visiting the departure country, and a third group: non-residents connecting through the departure country to the destination city on their way to a second destination city. This group can be a low proportion of the passengers for typically non-hub cities, but very high for destination cities that are “hubs” such as Singapore, Amsterdam, and Frankfurt.

On a country level, the UN Database of “Trade in Service” in the “Travel Component” provides estimates of how much each year residents spend abroad (air fare paid in home country not included). An algorithm is applied to this total outbound expenditure and estimated total number of outbound passengers to derive an estimate of average per outbound passenger’s expenditure overseas.

A margin of error is also unavoidable in such estimates, as not all outbound trips are of equal length, and the cost of living varies a great between arrival cities such that even if each trip of equal length, expenditure per passenger between different arrival cities would still be very different.

This margin of error is reduced significantly by imposing a minimum of expenditures in the algorithm, after a number of iterative testing (US$500 per trip for bordering arrival country and US$700 per trip for non-bordering arrival country).

At least they have a system.  I firmly believe that the Tourism Authority of Thailand just picks a number out of the sky and ensures that it is more than the previous year.

This line from The Nation article may be the most telling:

However, Bangkok fails to make it into the top 10 among the cities with the highest growth rates of visitor arrivals. The Spanish city of Barcelona heads the list, with a 24.3-per-cent expansion, and New York is placed 10th (11.7 per cent).

And despite what the Tourism Authority of Thailand reports, tourism in Thailand is on the decline.

Tags: china hong kong laos lies mastercard report singapore TAT tourism authority of thailand tourists truth visitors