The government must step up efforts to encourage people to visit second-tier destinations to enhance domestic tourism and broaden revenue distribution, says the Federation of Thai Industries (FTI).
If more tourists travel to these destinations, local communities and small and medium-sized enterprises (SMEs) will benefit from their spending, which would eventually contribute to economic growth.
Second-tier cities or provinces refers to areas that attract around 4 million visitors a year or less, according to the Tourism and Sports Ministry.
“Businesses have continued to earn low revenue since the pandemic, as Thailand’s economic growth has lagged behind neighbouring countries such as Vietnam,” said Kriengkrai Thiennukul, chairman of the FTI.
“This means we need stronger measures to stimulate the economy.”
He said the “Khon La Khrueng Plus” co-payment scheme alone is insufficient to revitalise the economy, with the government partially paying for products and services purchased by 13 million state welfare cardholders as well as 20 million other Thais.
According to the National Credit Bureau, Thailand’s non-performing loans (NPLs), especially in the household sector, have increased by 25% since the end of 2022, reaching a record high of 1.24 trillion baht as of January 2025.
“SMEs have high debt, accounting for 7.6% of NPLs in the final quarter this year,” said Mr Kriengkrai.
“Their debt will keep increasing if the government does not do more to solve their financial problems.”
He said he expects the Thai economy to recover in the final quarter of this year, partly driven by the co-payment scheme.
Mr Kriengkrai predicted the economy will continue to improve next year as manufacturers shipping products to the US gradually adapt to Washington’s tariff policy.
The Joint Standing Committee on Commerce, Industry and Banking projected GDP growth of 1.8-2.2% this year, with export growth of 2-3%, and inflation of 0.5-1%.