Pfizer and BioNTech have announced the development of a vaccine that is over 90% successful in preventing Covid-19. This should open investment opportunities in Thailand, particularly in Thailand’s tourism sector.
Thailand’s tourism sector and much of its economy has been in a slump since the Thai government took stringent measures to prevent the spread of Covid-19 in Thailand. Thailand’s measures have been remarkably successful in combatting the spread of Covid-19. But these measures have come at a substantial cost, with some claiming that Thailand’s has become a victim of its own success in fighting Covid-19.
Tourism is a major contributor to the Thai economy and the slump in the tourism sector has led to major layoffs in that industry and depressed prices in the hospitality sector. Employees who do not have a regular salary, low paid employees and employees without a regular salary have been hit particularly hard. Real estate has also been hit hard. But the development of a successful vaccine should bring that slump to an end.
There will be a lag between (i) the introduction of a vaccine and the relaxation of preventive measures and (ii) the recovery of Thailand’s tourism industry and economy generally. During that lag there will be opportunities for savvy investors to make investments and acquire hospitality and other assets in Thailand at a discount. But investors need to proceed cautiously because of Thai law restrictions on foreign ownership of businesses and assets.
We saw this before following the 1998 financial crisis in Southeast Asia. Prices slumped and recovery seemed unlikely, but it did occur, and those that made investments at the right time enjoyed tremendous rewards. It appears that we are the beginning of a similar cycle where solid investments made now will enjoy substantial rewards as the Thai economy recovers.