Middle East crisis deals yet another blow to Thailand’s international market

A decline in visitor numbers and airline capacity is causing another year of headaches for Thailand's tourist industry, which had not fully recovered from a slump in 2025.

Many countries in the Asia Pacific region have seen travel demand soften due to the Middle East crisis that began in late Feb-2026. But it is particularly significant for Thailand, as tourism represents up to 20% of its GDP.

Thailand's tourism was recovering well from the COVID-19 pandemic, but last year suffered a reverse when Chinese visitor numbers dropped dramatically following some high-profile incidents.

Demand was once again on the road to recovery when the Middle East conflict began. High fuel prices have caused airlines to cut back capacity, with higher fares and increased cost of living also discouraging travel.

This has been a factor in Thai tourism authorities discussing how to increase tourist spending and targeting higher-value tourists rather than volume (and stories of tourist misbehaviour don't help either).

Data indicates that Thailand's low-cost carriers are finding the current environment tougher than full-service airlines.