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A report released on June 27 by digital travel platform Agoda revealed that Thailand has dropped to second place behind Japan in the list of the most searched foreign destinations by Vietnamese travelers in the first half of this year.

Last year Thailand had held the top spot followed by Japan, South Korea, Singapore, and Malaysia.

Thailand’s Ministry of Tourism and Sports reported a 4.6% year-on-year decrease in foreign arrivals to 16 million in the first half of 2025.

Vietnam, the ninth largest source of visitors for Thailand in the first half of 2024 with nearly 502,000, did not appear in the top 10 in the first five months of this year.

Travel agencies and service providers paint a gloomy picture with respect to Vietnamese interest in Thailand.

Hoang Minh, director of a major Hanoi-based travel agency specializing in the Thai market, reported a 75% drop in searches for package tours.

BKT Bangkok Tourist, which offers Thai land tours for Vietnamese agencies, recorded a 50% decline in interest in the first half of the year.

Vo Duy Khang, representative of VietGoGo Company Limited, which provides retail travel services to Thailand, said visitor numbers dropped by 30-40%, and group tours that used to cost VND7-8 million are “discounted” to a mere VND4 million near the departure date but there is still no customer interest.

“In the first half of the year Thailand’s tourism faced several challenges, including earthquakes, a Covid outbreak and political tensions with Cambodia.”

Thailand’s tourism sector suffers from internal problems such as the lack of innovation at traditional destinations, which makes it harder to attract visitors, he said.

Tran Duy Vu of Ho Chi Minh City, who has been visiting the neighboring country one or two times a year for the past decade, said traditional destinations remain unchanged, costs have increased and cultural programs are “boring.”

Major tourist spots such as floating markets have become overly commercialized and lost their local charm, he said.

“Of course, Thailand is still great for shopping and food, but I believe that, besides Bangkok, other places are no longer appealing.”

As Vietnamese tourists seek new destinations, China has emerged as a rising star, ranking third in Agoda’s first-half report, with a 478% year-on-year increase in searches.

Nguyen Dong Giang, general director of BKT Bangkok Tourist, said Thailand now faces rising competition from emerging markets like China, which is actively promoted by many travel agencies on social media platforms.

Nguyen Huu Cuong, general director of Hanoi-based Trang An Travel, said Chinese tours are booming with diverse options starting at just VND4 million, making them popular among customers looking for affordable travel choices.

Tensions along the Cambodian border may be deterring some travelers from visiting Thailand, prompting them to opt for destinations like Singapore and Malaysia.

Thailand’s Constitutional Court recently suspended Prime Minister Paetongtarn Shinawatra pending a case seeking her dismissal, adding further challenges to Thailand’s political landscape, Reuters reported.

Pham Quoc Khanh, Deputy Director of Du Lich Viet Hanoi Branch, said that after many years as the top choice for Vietnamese tourists, traditional Thailand tours are losing their appeal to younger travelers, repeat visitors, and those seeking new experiences.

Young and middle-class tourists are increasingly seeking new destinations that offer deeper, more personalized experiences or opting for high-end tours.

Business data from travel agencies shows that interest in and bookings for China tours have grown by 20-30% compared to the same period in 2024.

Amid high domestic airfares, package tours to China, especially land routes or short flights, offer competitive prices.