July 7, 2025
BANGKOK – As tourism becomes the fastest way to inject revenue into national economies, countries around the world are fiercely competing for international travellers amid a global economic slowdown. This battle for tourists now involves aggressive visa facilitation, streamlined travel measures, and significant promotional budgets—efforts not merely aimed at enhancing the national image, but at generating tangible economic circulation.
In a startling development, Vietnam welcomed more Chinese tourists than Thailand for the first time in the first quarter of 2025. While Chinese citizens are still travelling abroad, many are choosing destinations other than Thailand, even as Southeast Asian nations compete with visa-free entry campaigns.
In Q1 2025, 1.6 million Chinese tourists visited Vietnam, compared with just 1.3 million to Thailand. This shift is notable given that in 2024, the number of Chinese visitors to Vietnam was only half of those arriving in Thailand.
Thailand saw a 24% year-on-year drop in Chinese arrivals in the first quarter of 2025, largely due to concerns over safety following the high-profile kidnapping of actress Xing Xing in January. According to VNExpress, analysts cited several factors behind Vietnam’s tourism boom: intensified tourism promotion campaigns, geographical advantages, and affordability.
This trend accelerated in May, when Chinese arrivals to Vietnam surpassed those from South Korea for the first time, reaching 357,907 visitors—or nearly 40% of all international tourists that month. It marked the first time since Vietnam’s post-Covid reopening in March 2022 that China became its top inbound market.
Vietnam steps up “tourism diplomacy”
Nguyen Thien Dat, CEO of ACA Travel, credited the surge in Chinese tourists to Vietnam’s proactive “tourism diplomacy” strategy. The Vietnam National Administration of Tourism (VNAT) has launched targeted campaigns in China and increased direct flights, such as VietJet’s new Ho Chi Minh City–Xi’an route launched on April 29.
Geographically, Vietnam holds an edge as mainland China has few swimmable beaches aside from Hainan Island. Chinese tourists, especially those seeking sun and sea, often prefer destinations like Thailand and Vietnam. Amid China’s domestic economic slowdown, travellers have also become more cost-conscious—favouring Vietnam for its relative affordability.
However, experts suggest Vietnam should focus on attracting high-spending tourists from major cities like Beijing and Shanghai.
Pham Ha, CEO of Lux Group, a luxury cruise provider, argued that Vietnam should position itself as a premium destination for Chinese travellers by offering high-end shopping, world-class cuisine, access to international luxury brands, and five-star hotel experiences.
Multiple factors have contributed to Vietnam’s growing appeal among Chinese tourists. These include a mutual visa-free travel agreement, province-to-province memorandums of understanding to promote “sister city” tourism, and the establishment of a cross-border QR code payment system to support seamless financial transactions between the two countries.
Malaysia overtakes Thailand as ASEAN’s top tourist destination in Q1 2025
In the first quarter of 2025, Malaysia surpassed Thailand to become the most-visited country in Southeast Asia, drawing 10.1 million international tourists. Thailand followed with 9.5 million, Vietnam welcomed 6 million, and Singapore recorded 4 million visitors. Thailand had previously held the regional tourism crown.
According to Travel & Tour magazine, Malaysia’s rise was fuelled by a combination of visa-free entry policies, targeted marketing, and infrastructure upgrades. The largest number of visitors came from Singapore—4.9 million trips—followed by China and Indonesia, with nearly 1.1 million visits each.
The Malaysian government recently extended its visa-free policy for Chinese tourists by five years, with a potential extension to 2036. Indian tourists are also included in the scheme, which currently runs through 2026. The initiative targets travellers from Asia’s two most populous nations.
The report also highlighted the role of improved digital visa systems, enhanced air connectivity, and better coordination between airports and travel agents in delivering a smoother travel experience.
Hong Leong Investment Bank noted that Malaysia’s tourism sector continues to grow despite a sluggish global economy, with Chinese visitor numbers surging 22% year-on-year in Q1 2025, reaching 10.1 million—making it the highest in Southeast Asia.
Visa-free travel boosts Chinese tourism across ASEAN
Analysts agree that China has long been a critical source market for ASEAN tourism, and visa-free access is amplifying the region’s appeal. John Paolo Rivera, Associate Director of the Dr Andrew L. Tan Tourism Center at the Asian Institute of Management in the Philippines, said visa waivers are a major enabler of tourism growth across the region.
Singapore is another country that offers visa-free entry to Chinese nationals. In 2024, Singapore welcomed 13.6 million foreign visitors, with China among the top three source markets. The Singapore Tourism Board (STB) expects continued tourism recovery this year, supported by increased flight frequencies.
Yu Hong, Senior Research Fellow at the East Asian Institute, National University of Singapore, noted that Singapore has long been popular among Chinese tourists due to geographic proximity, cultural similarities, and a strong network of direct flights linking Singapore with numerous Chinese cities.
Thailand aims for survival in 2025 as tourism rivals pull ahead
This year, Thailand’s tourism strategy is focused on survival rather than expansion, as regional competitors accelerate ahead. Thanapol Cheewarattanaporn, President of the Association of Thai Travel Agents (ATTA), said Thailand’s position in the tourism race has become increasingly difficult, especially when compared to countries like Japan and Vietnam.
“While other countries are moving forward, Thailand remains stagnant. The massive Chinese tourist market that once powered our industry has yet to return in full force,” Thanapon observed.
Sisdivachr Cheewarattanaporn , Honorary President and Senior Adviser to ATTA, added that urgent stimulus measures are needed to prevent a further decline. “This year we must focus on staying afloat. If there are any plans to boost the sector, they must be implemented swiftly to maintain our target of 35 million international arrivals—close to last year’s figure,” he said.
Thienprasit Chaiyapatranun, President of the Thai Hotels Association (THA), projected foreign arrivals at 34 million this year, below the Tourism Authority of Thailand’s (TAT) official target. Still, he described this outcome as a solid performance, given softening global demand—particularly from China, where concerns over safety have tarnished Thailand’s image. He urged stronger law enforcement to restore confidence, which would benefit not only Chinese travellers but tourists from other countries as well.
He also called on the government to reconsider its visa waiver programme, which currently allows citizens from 93 countries to stay in Thailand for up to 60 days. “Visa policies should be tailored to each market in line with travel behaviour and average length of stay,” he said, noting that some visitors use the scheme to work rather than for leisure.
Destinations across the region intensify competition
Suphajee Suthumpun, Group CEO of Dusit Thani Public Company Limited, noted that Thailand now faces fierce competition from alternative destinations across the globe, including Vietnam and the Philippines. To maintain competitiveness, she urged closer public-private cooperation to extend visitors’ length of stay through targeted segments such as medical and wellness tourism, MICE (meetings, incentives, conferences, and exhibitions), gastronomy tourism, long-stay travel, and work-from-anywhere packages.
“If tourists are just looking to travel, they might pick Vietnam or the Philippines instead,” she warned. “As global risks mount, people may be less inclined to travel for leisure alone. But if we adopt a focused marketing approach, we can tap into new demand. The old model of selling Thailand as just a ‘pretty destination’ no longer works in today’s landscape.”
AWC launches major project to help revive Thai tourism momentum
Wallapa Traisorat, CEO and President of Asset World Corporation (AWC), announced that the company is ramping up efforts to attract high-quality tourists through strategic partnerships. A highlight is the upcoming Jurassic World: The Experience, set to open this July at Asiatique in Bangkok, with an investment of 1.4 billion baht. The attraction is expected to become a flagship experience that repositions Thailand as a fun and engaging destination.
“Tourism remains a key strength for Thailand,” Wallapa said. “We hope to see national campaigns that rebuild global traveller confidence and reconnect Thailand with the world.”
Comparing performance: Japan, Vietnam and Thailand
Recent data for the first five months of 2025 (January–May) shows that Japan and Vietnam both recorded over 20% year-on-year growth in international tourist arrivals, while Thailand experienced a decline of nearly 3%.
Japan welcomed 18.14 million foreign visitors during this period—an increase of 23.9% year-on-year. The top five source markets were:
South Korea – 4.05 million (+8.4%)
China – 3.92 million (+62.9%)
Taiwan – 2.69 million (+12.3%)
United States – 1.35 million (+29.6%)
Hong Kong – 1.10 million (+7.7%)
Vietnam, considered a rising star, welcomed 9.20 million international tourists in the same period—a 21.3% increase. Its top five markets were:
China – 2.36 million (+47.2%)
South Korea – 1.90 million (−2.4%)
Taiwan – 532,897 (+0.6%)
United States – 375,417 (+7.2%)
Japan – 342,156 (+18.3%)
Thailand, by contrast, received 14.36 million foreign visitors, a 2.7% decline year-on-year. Its top five source markets were:
China – 1.95 million (−32.71%)
Malaysia – 1.90 million (−5.51%)
India – 978,600 (+16.18%)
Russia – 961,143 (+13.27%)
South Korea – 673,563 (−16.17%)
Malaysia surpasses China as top source of tourists to Thailand in first half of 2025
Thailand welcomed a total of 16,685,466 international visitors in the first half of 2025 (January–June), representing a 4.66% decline compared to the same period last year, according to the Ministry of Tourism and Sports.
For the first time in recent years, Malaysia overtook China to become Thailand’s largest inbound market. The top five source countries were:
Malaysia – 2,299,897 visitors (−5.58%)
China – 2,265,556 visitors (−34.13%)
India – 1,183,899 visitors (+13.82%)
Russia – 1,034,759 visitors (+12.35%)
South Korea – 772,107 visitors (−17.42%)
TAT maintains target of 35 million foreign arrivals in 2025
Thapanee Kiatphaibool, Governor of the Tourism Authority of Thailand (TAT), stated that in the second half of the year (July–December), signs of recovery have begun to emerge—particularly from the Chinese market, which has started to record more than 10,000 arrivals per day.
Despite the positive trend, Thailand saw 2.32 million foreign arrivals in June alone, a 15.24% year-on-year decline, due to factors such as the ongoing conflict in the Middle East, slower recovery in Chinese outbound travel, and the low season for the European market.
To address this, the Thai Cabinet on June 24, approved a 3.96 billion baht stimulus package for the tourism sector. The funding will support seven projects aimed at boosting tourism during the second half of the year, with an expected economic impact of 200.5 billion baht.
Of the total budget, 750 million baht has been allocated to support charter flights, offering subsidies of 350,000 baht per flight for at least 1,000 flights from 15 second-tier Chinese cities and high-potential markets. These flights will connect to Bangkok, Phuket, Chiang Mai, Chiang Rai, Pattaya (U-Tapao), Krabi, and Samui.
TAT also plans to launch joint promotions with both Thai and international commercial airlines, especially those operating from the Middle East and ASEAN countries, with the aim of stimulating travel in the second half of the year. The campaign is expected to bring in at least 790,000 additional tourists, generating an estimated 33.5 billion baht in revenue.
TAT is maintaining its target of 35 million foreign visitors for 2025. With 16.68 million arrivals recorded in the first half, the second half would need to deliver nearly 19 million arrivals to hit the goal.
If achieved, the 35 million target would represent at least a 10% increase in tourism revenue, rising from 1.67 trillion baht in 2024 to an estimated 1.83 trillion baht in 2025.