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Wednesday, July 24, 2024

Thai Hotels Oppose Increased Foreign Ownership of Condos

The Thai Hotels Association (THA) has voiced strong opposition to the government’s plan to permit foreign ownership of up to 75% in condominium units. The association argues that this proposal could lead to intense price competition and disrupt the hospitality market. These concerns were articulated during a recent industry meeting addressing key sector issues.

Tourism and Sports Minister, Sermsak Pongpanich, used the meeting to outline Thailand’s tourism strategy and the government’s supportive policies for the sector. He encouraged members of the association to discuss their challenges openly and provide constructive feedback.

A major issue discussed was the government’s proposal to increase foreign ownership limits in condominiums from 49% to 75%. The THA contends that such a change would severely impact their industry. Tianprasert Chaipattananon, President of the THA, reported that the Ministry of Finance is preparing to present this policy to the Cabinet. Chaipattananon expressed strong objections, arguing that higher foreign ownership would enable condos to be rented out on a daily basis, directly competing with hotels and potentially triggering price wars. The association pointed out the significant cost disparities between legally registered and unregistered hotels. Currently, over 40,000 hotels are listed on online travel agency platforms, but only about 15,000 to 16,000 are legally registered. The remaining 25,000 operate without proper registration.

Should the Cabinet approve the policy, the market could see an influx of condos available for daily rental, increasing competition. There is also concern that the 25% ownership cap might be bypassed by using foreign nominees.

The meeting concluded with a strong appeal for the government to reconsider the proposed policy, citing potential negative impacts on the hotel industry and broader economic repercussions. The association emphasized the need for a balanced approach that supports foreign investment while ensuring the sustainability of local businesses.

In attendance were several key officials and industry representatives who echoed these concerns, underscoring the importance of maintaining a competitive but fair market environment.

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