Foreign investors have been pumping money into stocks in the country, boosting the market by 7.5% (over a period of 6months), but the escalation of violence has brought investments to a standstill. The tourism industry has faced a severe blow in the midst of the current ‘red shirt’ protests.
Kasem Prunratanamala (head of research at CIMB Securities) said that “Tourism will be the very first sector to be hit and the Thai stock market should react negatively on Monday. The heavy foreign buying we have seen in the past month will hold back until the political situation is clearer”
40 countries have issued travel advisories warning people about the problems in Thailand. Since the protests began, tourism has dropped by 10% and reservations at hotels, which are normally at 60% capacity, has dropped to 20-30%.
Although the tourism industry has been hit by the ‘red shirt’ protests, it is expected that the export-driven economy will not be influenced, as long as the violence discontinues.
Q+A- Are Thai protests hurting tourism and economy? [Reuters,9 April 2010]
Thai "red shirts" defiant after 21 die in clashes [Reuters,11 April 2010]