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Koh Samui in Full Bloom – Part 1

Category: , Posted:13 Sep 2008 | 12:00 pm

Over the years, Koh Samui has made a stunning market shift from backpackers' paradise in the 1970s and 80s to its present push as one of the region's premier island destinations. From the onset of significant tourism, most development was focused on the eastern area at Chaweng Beach, with access limited to ferry service from the mainland.Most visitors either flew to Surat Thani or came by bus or train before crossing by sea. Mass tourism entered the picture with the privately developed and operated airport opened by Bangkok Airways in 1989.
During the past decade, development by both Thai and international investors has accelerated, which has seen a laid back island fishing village metamorphose into a mid-market tourism destination and is now shifting gears and entering the branded world of high-end luxury. Direct international air links to Hong Kong and Singapore supported the building boom and a key growth component has been the opening of the airport to Thai Airways and a handful of overseas carriers.
Historically, the number of tourist arrivals on Samui has not been as dazzling as that of Phuket due to Bangkok Airways' monopoly over air services to the island. Over 10 years, starting from 1998, guest arrivals at tourism establishments grew at an average of only 1.5% per annum; capping off at 854,475 in 2007. However, the total visitor arrivals at Samui Airport from 1995 to 2007 grew at an average compounded rate of 9% – and from 2003 to 2007 grew at 16.8%.
A comparison of the number of visitor arrivals and the number of those using tourism establishments, clearly shows growth in the number of tourists staying in alternative accommodations, that is, in villas and condos versus hotels. This is consistent with many markets such as Bali.With tourist arrivals via the airport numbering 683,200 in 2007, much work remains to be done in terms of infrastructure in order to accommodate the growing the number of tourists.
Bangkok Airways has been addressing airlift by upgrading its fleet, retiring many smaller turboprop planes and replacing them with larger Airbus A319 aircraft. Also now with overseas flights available, capacity is expected to rise by 62%. Further, the Samui Airport terminal expansion of both the domestic and international areas was fully completed this year.
As with Phuket, much is being debated about the need for a larger airport and landing strip on Samui. The current runway is 4,700 feet long, but larger aircraft from long-haul destinations require at least 6,000 feet to land. The airport in Surat Thani has a 9,000-foot runway, though terminal facilities remain limited and regional passengers are increasingly looking for door-to-door access on holiday trips.
There have been talks about relocating Samui Airport to the southern part of the island, but this is a long-term planning option at the moment.
With its bustling development, traffic currently relies on a primary ring road, which stretches around the island, though there are new roads to areas such as Taling Ngam, Phang Ka Bay and Thong Krut.
The opening of the hypermart with both Tesco and Big C has brought greater diversification from the highly centralized Chaweng Area than in the past.
The opening of the island's first golf course a few years ago marked the arrival of limited new demand-generated facility growth in areas such as international schools, hospitals and tourism attractions. As critical mass is achieved with residential sales, this is expected to accelerate in the medium term.
While Phuket and Samui share many similarities, the latter is certainly at a stage much earlier in the cycle of development.
Phuket has Sarasin Bridge connecting it with the mainland and – barring any significant disruptions to air services – it enjoys many advantages over Samui in terms of relative ease in movement of tourists, commodities and an existing service economy to support and spur further growth.Yet both Phuket and Samui have seen new development being pushed to outlying islands and areas as new tourism destinations. For what is now being called "Greater Phuket", it has been Krabi, Phang Nga Bay and Khao Lak. For Koh Samui, it has been Koh Pha-ngan and Koh Tao.
Roads on both islands were not designed to carry existing loads or planned to cater to the sheer number of developments that they do – and other infrastructure is also being stretched to its limits. In the long term, it will be interesting to see how each island copes and manages this balancing act into the future. In my next column, I'll look at Samui's residential markets of the past, present and future, so stay tuned.

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