Thailand’s Tourism Revenue Set to Drop This New Year – Will Border Tensions and Flooding Ruin the Holiday Season?

Published on December 26, 2025

Thailand is facing a decline in tourism receipts during the New Year holiday period, with projections showing a decrease of 2-9% compared to last year. The Tourism Authority of Thailand (TAT) has forecasted that the country will generate between 70 and 76.5 billion baht in tourism revenue during this period, which marks a noticeable drop from the previous year. Several factors are contributing to this decline, including the ongoing border tensions between Thailand and Cambodia and severe flooding in southern provinces, particularly affecting travel to destinations like Hat Yai in Songkhla.

Impact of Flooding on Tourism in Southern Thailand

One of the primary reasons behind the decrease in tourism revenue is the significant disruption caused by flooding in southern Thailand. The tourism sector in the southern provinces, including areas like Hat Yai and other parts of Songkhla, has been particularly hard-hit by severe weather conditions. These natural disasters have dampened travel plans, especially from neighboring Malaysia, a major source of tourists to the region. The flooding has led to road closures, landslides, and other challenges that have deterred travelers from visiting southern Thailand during the peak travel season.

Additionally, the flooding has had an economic impact on local businesses and tourism operators, further contributing to the overall decline in tourist arrivals. While the Thai government and tourism bodies are working on recovery efforts, the timing of these events has made it difficult to fully mitigate their effects on tourism during the critical holiday period.

Border Tensions Affecting Travel Confidence

Another significant factor contributing to the anticipated drop in tourism revenue is the recent border conflict between Thailand and Cambodia. Early December saw heightened tensions, which have affected travel confidence, particularly among markets such as China, Hong Kong, and Japan. These regions are sensitive to geopolitical issues, and the tensions along the Thailand-Cambodia border have led to cautious travel behavior, with some tourists opting for alternative destinations.

The impact of this border conflict has been particularly noticeable in Chinese, Hong Kong, and Japanese markets, which traditionally account for a substantial number of visitors to Thailand during the New Year period. As these markets experience a decline in traveler confidence, it is expected that the overall number of foreign arrivals will be lower compared to previous years.

Estimated Decline in Foreign Arrivals and Revenue

During the period between December 20 and January 1, foreign arrivals to Thailand are projected to range from 1.4 to 1.5 million, representing a year-on-year decrease of 6-12%. This decline in international visitors is expected to result in a revenue dip of 4-15%, with total revenue estimated to be between 51.6 and 58 billion baht. Despite this, the situation is not all negative, as there are still positive signs in certain segments of the tourism market.

Growth in Middle- and Long-Haul Visitors

Despite the challenges posed by natural disasters and geopolitical tensions, Thailand is seeing a steady increase in middle- and long-haul visitors. These travelers have helped cushion the overall decline in tourism receipts, with seat reservations from these markets recording a 6% increase during the holiday period. The rise in bookings from long-haul destinations reflects the continued popularity of Thailand as a desirable destination for international travelers, particularly those seeking winter sunshine.

In addition to this, Bangkok has received recognition as a top winter destination. Tripadvisor’s Winter Travel Index for 2025 ranked Bangkok among the most popular destinations globally for international travelers, alongside major cities like London, Cancun, and Paris. This recognition highlights the city’s enduring appeal despite the challenges faced by the tourism sector during this period.

Boost in Flight Connectivity for the Holiday Season

To support the influx of tourists, Thailand has introduced more than 10 new international routes for the holiday season. These routes include flights from key markets such as China, Taiwan, Japan, Singapore, and Vietnam, as well as charter services from Europe to cities like Bangkok, Phuket, Krabi, Chiang Rai, and Chon Buri. The expansion of flight options has made it easier for international visitors to travel to Thailand, providing a boost to the country’s tourism sector during the New Year period.

The addition of these international routes reflects Thailand’s ongoing efforts to improve connectivity and attract more visitors from diverse global markets. The tourism industry has long relied on international visitors, and with the new flight options, there is a potential for recovery in some areas of the sector, despite the challenges faced by other regions in the country.

Domestic Tourism Expected to Show Growth

While international tourism is experiencing a downturn, domestic tourism in Thailand is expected to see growth during the New Year holiday. The TAT forecasts a 7% increase in both domestic trips and revenue, with a projected 4.96 million domestic trips generating 18.5 billion baht in revenue between December 31 and January 4. This growth is driven by the extended five-day holiday, which has encouraged more Thai residents to travel within the country.

Additionally, the nine countdown events organized by the TAT are expected to generate 4.83 billion baht, marking an 8% increase year-on-year. These events are expected to attract 859,300 local trips, contributing to the overall growth in domestic tourism. The nationwide celebrations, coupled with cool weather conditions, have provided a strong incentive for local travelers to explore different parts of Thailand during the festive season.

Outbound Tourism on the Rise

Outbound tourism from Thailand is also showing signs of growth during the New Year holiday. Thai tourists are increasingly traveling abroad, with China remaining the top destination due to visa-free schemes and affordable airfares on many new routes. Japan, despite higher airfares, is also a popular choice, attracting tourists with its weak yen, which makes travel more affordable for Thai visitors.

The strength of the Thai baht has continued to support outbound travel, as it allows Thai citizens to travel more affordably. While middle-income earners may be concerned about economic conditions, they remain enthusiastic about traveling abroad once or twice a year, taking advantage of the more favorable exchange rates. In the first half of the year, outbound tourism grew nearly 20% compared to the previous year, although the second half saw a slowdown due to the declining confidence linked to border tensions.

This year, the outbound tourism market is expected to grow by 10-15% compared to 2024, surpassing the levels seen in 2019. This reflects the continued appetite for international travel among Thai citizens, particularly those seeking to take advantage of favorable currency exchange rates and affordable travel options.

Conclusion: Mixed Outlook for Thailand’s Tourism

In conclusion, Thailand’s tourism sector faces a mixed outlook for the New Year holiday period. While the country is experiencing a decline in foreign tourism receipts due to flooding, border tensions, and a reduction in traveler confidence, the domestic market and outbound tourism are showing positive growth. With improved flight connectivity, a strong baht, and continued interest from middle- and long-haul visitors, Thailand’s tourism sector remains resilient despite the challenges faced in the short term. The government’s efforts to boost tourism through events, marketing, and expanded flight options will continue to play a vital role in ensuring the industry’s recovery and long-term success.