Cancelled Flights: Stranded Russian Tourists Stuck In Beach Resorts

Thailand’s government has also offered to rollover visitor visas for free and has mooted the idea of offering shelter to Ukrainians and Russians, and to allow the use of cryptocurrencies as an alternative payment system.

Latest news reveal that thousands of Russian tourists have been stranded in beach resorts in south east Asia as flights home are cancelled and amid growing anxiety that the Ukrainian war will stymie the regional economy’s recovery from the pandemic.

The Philippines, Laos, Cambodia and Thailand have recently reopened to vaccinated travellers and Indonesia and Vietnam are gearing up to welcome visitors back this month, aiming to revive a tourism industry that has been decimated by two years of border closures and Covid-19 restrictions.

With lucrative Chinese tour groups still grounded under pandemic rules, expectations had fixated on the sizeable Russian market to fill the gap, but the invasion of Ukraine, which has resulted in rising oil prices, flight bans and sanctions, has put a swift end to those hopes.

“This is going to be a really uncertain period for an industry that simply wasn’t recovering yet. It’s certainly been a set back,” said Gary Bowerman, a travel analyst based in Kuala Lumpur, Malaysia.

“South east Asia is right at the beginning of its reopening process, and it needs as many tourists as it can get, particularly without the Chinese market, that is the big overlay,” he said. “The overall outlook is a lot gloomier than it looked a month ago.”

The fallout is already being felt in tourist-dependent hotspots like Bali and in Thai island resorts. In 2019, Thailand received 1.4 million Russian visitors, and in 2021, Russia featured in the top three groups of tourists by nationality, after the United States and Germany.

In January, Thailand counted about 23,760 Russians, out of 133,903 total arrivals, according to tourism ministry figures.

S ince the invasion of Ukraine, more than 7,000 Russians have been left in limbo in popular locations like Phuket, Koh Samui, Pattaya and Krabi, trapped by cancelled flights and unable to pay bills with the ruble in freefall and Russian banks being cut off from the global SWIFT system.

The current crisis has not only left tourists in dire straits but could leave hotels out of pocket.

“We've asked hotels to reduce prices and extend their stays,” Phuket's tourism association president Bhummikitti Ruktaengam said.

But beyond the immediate impact of Russian holidaymakers struggling to reach home, Mr Bowerman said the bigger question was what would happen long term to the huge Russian market and the impact of rising jet fuel prices on the industry more generally.

Russia accounts for about 10 percent of the world’s supply of crude oil, and markets have been spooked by the prospect of international curbs on Russian oil exports and possible retaliatory measures from Moscow.

“Jet fuel prices are going to continue to go up and that’s going to have such a huge impact on the airlines’ ability to offer flights,” said Mr Bowerman.

“The whole region’s recovery is based on the low-cost carriers and they are not going to be able to compete the way they did before because their costs are going to be so high,” he said.

The impact of financial penalties and sanctions on Russia were already radiating around the world and would impact Asia’s tourism industry in multiple ways.

“We are already seeing it’s not just jet fuel prices going up. Commodity prices, wheat and food prices are going up. It’s going to have a huge inflationary impact.

“That’s going to feed across all the value chain of tourism - food producers for hotels, small shops, people who cook food in the streets, it’s going to have a huge impact,” he said.

“It’s worth remembering that these people have been hit incredibly hard for the last two years and they haven’t even started to recover in most countries yet.”

In Bali, Russia overtook Australia in the first year of the pandemic as the largest source of tourists, with some 68,000 of its citizens flying to the island paradise in 2020, according to Statistics Indonesia. Russians were among the first to return when borders partially reopened last year.