Thai govt warns of huge tourism damage from protests

BANGKOK (Reuters) - Thailand, one of the world's top tourist destinations, could suffer a dramatic fall in visitors next year if the country's political crisis drags on, a deputy prime minister said on Saturday.

"The closures have severely affected the tourist industry," Deputy Prime Minister Olarn Chaipravat told reporters as anti-government protesters blockaded Bangkok's international airport for a fourth day.

The closure of the $4 billion Suvarnabhumi airport since late Tuesday has forced the cancellation of hundreds of flights and stranded thousands of tourists. Don Muang airport, a big domestic hub, was also shut due to protests on Thursday.

Olarn said he expected tourist arrivals to fall to 13.5 million this year, from 14.5 million last year.

"Next year, foreign tourist arrivals may fall by half and about one million people may be jobless if we don't have any measures to help them," Olarn said, giving a far gloomier prediction than some analysts.

Broker Asia Plus Securities expected arrivals to drop to 13 million in 2009.

The unrest at Suvarnabhumi, which handles more than 100,000 travellers daily, could not have come at a worse time for Thai tourism, since November is the start of the peak season.

Tourism directly employs 1.8 million people and brings in the equivalent of 6 percent of gross domestic product, making it a major driver of the economy, which is already suffering from slowing exports caused by the global economic slump.

Bank of Thailand chief economist Amara Sriphayak said on Friday the tourist sector could lose 140 billion baht in revenues next year, or 1.5 percent of gross domestic product, if the political strife continued to the end of the year.

Olarn said the government would spend about 1 billion baht over the next month to help stranded tourists, including giving them free hotel rooms and a daily stipend of 2,000 baht.

Some trapped travellers told Reuters their accommodation and meals had been paid for, but they received no allowance.

The government began shuttling thousands of stranded tourists by bus to U-Tapao, a Vietnam War-era naval airbase 150 km (90 miles) east of Bangkok, as an alternative landing site for airlines, but tourists reported delays and confusion.

A prolonged closure of Suvarnabhumi, which can handle 3 million tonnes of cargo a year, would do serious damage to an export-driven economy already struggling to cope with a global slowdown, experts say.

Finance Minister Suchart Thada-Thamrongvech said the political crisis could cut economic growth to 2 percent next year from 3-4 percent projected earlier, the Bangkok Post reported.

The government has previously forecast 2008 growth of 4.5 percent, down from 4.9 percent in 2007.

"The current political problems have shattered business confidence and it will take more than one year to restore," Suchart was quoted as saying.

($1=35.45 Baht)

(Writing by Orathai Sriring; Editing by Darren Schuettler and Valerie Lee)