In a bid to redirect tourist spending towards local businesses, the Thai government has announced plans to close all duty-free shops in the arrival areas of international airports. The move, announced by the Cabinet last Tuesday, aims to increase domestic spending and promote the use of local products.
The duty-free shops, currently operated by three companies, will be scrapped from eight major airports, including Suvarnabhumi, Don Mueang, Chiang Mai, Phuket, Hat Yai, U-Tapao, Samui, and Krabi. While a timeline for the closure has not been set, the operators have agreed to stop operations until the policy is lifted.
According to the Thai government, the duty-free shops generated a total profit of 3.02 billion baht (approximately S$112 million) in 2023. However, the closure is expected to increase tourists’ spending in local shops by an average of 570 baht (S$21.10) during their trip, resulting in an estimated 3.5 billion baht (S$130 million) in local retail spending each year.
The government believes that this move will boost overall production, investment, and employment, as well as promote domestic consumption and the use of local products. Tourism is a significant contributor to Thailand’s economy, accounting for nearly 20% of the country’s gross domestic product.
In related news, Thailand has also extended visa stay periods for tourists, students, and remote workers, and made more countries eligible for visa-free entry, effective from July 1. This move is aimed at attracting more tourists to the country and boosting its economy.
The closure of duty-free shops in airport arrival areas is seen as a strategic move to redirect tourist spending towards local businesses, promoting domestic consumption and economic growth. As Thailand continues to recover from the pandemic, this move is expected to have a positive impact on the country’s economy and tourism industry.