Tourism Downturn: The Impact of the Strong Thai Baht on Bangkok, Phuket, Chiang Mai, and Southeast Asia – What It Means for Travelers

Published on December 31, 2025

Thailand’s tourism sector, a major contributor to the country’s economy, is facing fresh challenges with the strengthening of the baht. While a stronger currency is often seen as a sign of economic stability, for Thailand, it has created a competitive disadvantage, particularly in attracting international visitors. In recent months, analysts have pointed to the Thai baht’s strong performance against other global currencies, with projections indicating the baht could reach 30 to the dollar in the near future. This development is a significant issue for Thailand’s travel industry, especially after similar struggles were experienced in 2019 and 2021.

The Impact of a Strong Baht on Thai Tourism

The Thai tourism industry is a cornerstone of the country’s economy, drawing millions of visitors annually. However, the appreciation of the baht is making it less appealing to travelers, particularly those from long-haul markets. As the Thai baht strengthens, Thailand’s destination competitiveness diminishes compared to other regional markets such as Vietnam, Indonesia, and Malaysia, where currency devaluation has made these destinations more attractive to budget-conscious tourists.

The Tourism Authority of Thailand (TAT) has already raised concerns, suggesting that the baht’s strength could lead to a 15-17% decline in tourism revenue for 2025. This loss would primarily affect inbound tourism from long-haul markets, where visitors are sensitive to currency fluctuations. The effect is especially detrimental to the country’s short-haul markets, which account for 70% of Thailand’s tourism.

Local Travel Experts Sound the Alarm

Leading figures in the Thai travel industry, including members of the Association of Thai Travel Agents (ATTA), have expressed their concerns regarding the ongoing currency issue. Travel professionals argue that despite reports of higher spending per tourist, the numbers do not tell the full story. Tourists are not necessarily buying more goods or spending significantly more, despite the apparent increase in their spending capacity.

The rise of the baht has made Thailand’s neighbors more attractive, with regional destinations offering better value for money. Thailand’s appeal as a low-cost destination is waning, and competing destinations now offer a similar experience at a lower price, making them more enticing to travelers.

Hoteliers Remain Hopeful but Realistic

While the strengthening baht presents challenges, some hotel managers remain optimistic. For instance, Sindhorn Kempinski Hotel Bangkok has indicated that Thailand is increasingly positioning itself as a destination not just for budget travelers but for those seeking high-quality experiences centered around wellness, culture, and cuisine. As competition in the region grows, Thailand’s tourism industry is shifting its focus from being a cheap destination to one that provides value-added experiences such as luxury wellness retreats, cultural tours, and gastronomic adventures.

In this shift, Thailand’s tourism sector is focusing on value over cost, with a new approach aimed at attracting a higher-spending clientele who value the quality of their travel experiences over low prices. As global travel trends evolve, many believe that destinations focusing on wellness, luxury, and cultural immersion will see an increase in tourist interest, despite the higher currency exchange rates.

What Travelers Can Do to Navigate Thailand’s Strong Baht

For those planning a trip to Thailand, there are a few strategies that can help mitigate the effects of the strong baht:

1. Opt for Short-Haul Markets: Travelers from nearby countries may find more competitive pricing for flights and accommodation in other Southeast Asian countries. However, for those determined to visit Thailand, considering destinations outside of Bangkok, such as Chiang Mai or Phuket, may offer better value.
2. Stay in Local-Run Hotels: While luxury hotels are abundant in Thailand, opting for smaller, local-run establishments or guesthouses can offer excellent experiences at a fraction of the cost of international hotel chains.
3. Look for Currency Exchange Tips: Travelers should keep an eye on currency exchange rates and consider exchanging currency at a more favorable rate when the baht weakens temporarily.
4. Embrace Local Experiences: Thailand is known for its food, culture, and unique experiences. Engage in local activities like cooking classes or cultural performances that provide authentic Thai experiences without the high price tag.
5. Plan Travel During Off-Peak Seasons: Traveling during the off-peak months can result in significant savings on both flights and accommodation, as well as providing a more relaxed experience without the usual crowds.

The Future of Thai Tourism: Can the Baht Be Tamed?

The question of whether Thailand can overcome the current challenges posed by its strong currency remains uncertain. However, with global tourism trends increasingly shifting toward experiential travel, the nation’s focus on value-driven tourism offers a ray of hope. If Thailand can continue to offer experiences that prioritize quality and cultural authenticity, it may still be able to draw travelers despite the strong baht.

As the situation develops, Thailand’s tourism authorities and businesses are likely to continue seeking solutions that maintain the nation’s status as one of Asia’s top destinations for international tourists.