Dr. Saul: Thailand & The Desire Economy

Dr. Saul Kruggerand, the renowned Ph.D. economist and native of South Africa, whom we last heard from in his article titled Thailand to Tackle World’s Desire Deficit in which he outlined the present economic structure of Thailand’s Desire Sector (DS) along with an insightful and detailed estimate of the Desire Sector’s current contribution to Thailand’s overall GNP. In today’s post Dr. Saul analyzes Thailand’s plan to target and develop Thailand’s Desire Economy Sector in order to re-stimulate & maximize Thailand’s GNP.

“Dr. Saul,” as he is affectionately called by his students, having focused his highly-tuned analytical skills on the present structure and dimensions of the Thailand’s Desire Sector, now follows with a detailed analysis of the radical and heretofore overlooked proposal the Thailand government made at the recent G-20 and Apec meetings to further develop the Desire Sector of the Thai economy in order to help reduce the World’s Desire Deficit (WDD) as well as to make a surprisingly significant contribution to the re-stimulation of overall economic growth in Southeast Asia and the world.

Dr. Saul is himself a Yesbel Laureate with his Ph.D. from the prestigious London School of Economics LSE. Dr. Saul has worked with or along with the World Bank, IMF, Goldman Sachs, the Dubai Sovereign Fund, AIG Hedge Fund Division and George Soros. A generous grant from the Chuwit Foundation in Bangkok where Dr. Saul is the director of research and senior fellow has helped to fund Dr. Saul’s recent studies in this area. And now, without further introduction, here is

Dr. Saul Kruggerand, Ph.D. Economist, Chuwit Foundation Director of Research & Senior Fellow

Most of the world’s economic experts have long ago reached a consensus that the inevitable and momentous process of globalization creates the most optimum outcomes when the various countries and geographic areas of the world economy are set free to focus their Financial and Human Capital (FHC) on those sectors in which they excel and leave to others those sectors in which they do not excel, thus creating large-scale efficiencies and increases in productivity per man or woman hour of labor as well as higher rates of return than otherwise might have been achieved on invested capital.

In examining the present Thai economy, the importance of various sectors cannot be overlooked, for instance:

* agriculture
* vehicle and vehicle parts
* computer and electronic
* banking
* construction
* hotels/tourism

However, while Thailand’s efforts in each of these sectors is satisfactory, in none of these areas is Thailand a world leader in:

* efficiency
* productivity
* return on invested capital

So while these areas will continue to grow and prosper over the long term, they do not present the Thai economy with any unique or special opportunities to generate extraordinary additional growth, rates of return or increases in labor productivity.

However there is one economic sector in which Thailand has:

* a world class infrastructure already in place
* a vast and sophisticated management knowledge at every level
* an in-place minister of commerce with practical, hands-on experience and expertise
* a workforce whose existing skill set is 2nd to none
* a large-scale pool of investment capital already available and in use

That is, the Desire Sector (DS), an economic area in which the entire world acknowledges and recognizes Thailand’s innovation, dominance and leadership.

Thailand’s Desire Sector Volume Levels for 2009

According to exhaustive studies by the Chuwit Foundation staff, the 2009 volume levels of Professional Service Provider (PSP) transactions per year in Thailand’s Desire Sector were as follows:

Approximately 4 billion PSP transactions of which:

76.2% took place in the Male/Female Heterosexual sector and involved female PSP’s and:

* Thai men (71.13% of the overall 4 billion PSP transactions in 2009)
* Farang men (both residents and visitors) (1.06%)
* Japanese men (both residents and visitors) (.057%)
* Malaysian men (visitors) (.255%)
* Chinese men (visitors) (.049%)
* Taiwanese men (visitors) (.173%)
* Korean men (visitors) (.18%)
* Hong Kong men (visitors) (.02%)
* Singaporean men (visitors) (.01%)
* Indian men (both residents and visitors) (.14%)
* Arab men (visitors) (.15%)
* Overseas remittance transactions involving various non-Thai men (2.45%)

11.46% involved gay or lesbian PSP’s and:

* Male/female visitors to Thailand (.31% of the overall 4 billion PSP transactions in 2009)
* Thais in Thailand (10.73%)
* Expats resident in Thailand (.42%)

12.35% Involved Lady Boy PSP’s and:

* Male/female visitors to Thailand (.12% of the overall 4 billion PSP transactions in 2009)
* Thais in Thailand (11.75%)
* Expats resident in Thailand (.48%)

Desire Sector PSP Velocity per week/Revenue per PSP Transaction

Within the overall volume of 2009 transactions, there were significant differences in “Velocity per Week” as well as in the “Revenue per PSP Transaction” as follows:

In the heterosexual male/female sector:

* Thai men 2.36 transactions per week at an average cost of 30 USD per transaction
* Japanese men 4.3/wk at 70 USD/transaction
* Malaysian 2/wk at 30 USD/transaction
* Chinese 4/wk at 60 USD/transaction
* Korean 4/wk at 70 USD/transaction
* HK 5 at 60 USD/transaction
* Singapore 5/wk at 60 USD/transaction
* Indian visitor 3/wk at 50 USD/transaction
* Indian resident 2/wk at 50 USD/transaction
* Arab 6/wk at 60 USD/transaction
* Farang visitor 5/wk at 70 USD/transaction
* Farang resident 2.5/wk at 50 USD/transaction

In the gay/lesbian sector:

* Thai male/females 1.4 transactions/wk at 40 USD/transaction
* Non-Thai foreign visitors 6.6/wk at 60 USD/transaction
* Non-Thai residents 2.2/wk at 50 USD/transaction

In the ladyboy sector:

* Thai men 2.3 transactions/wk at 40 USD/transaction
* Non-Thai foreign visitors 8.4/wk at 70 USD/transaction
* Non-Thai residents 2.5/wk at 50 USD/transaction

In the “Remittance from Overseas Thai PSP Segment” (from the fourteen highest volume countries):

An average of 20 PSP transactions per week by approximately 100,000 overseas Thai PSPs at average revenue levels ranging from 100 USD/transaction down to 50 USD/transaction with approximately 50% “subtracted” by the “handling agents/facilitators” (aka “traffickers”).

Desire Sector 2009 Summary

In the year 2009, Thailand’s Desire Sector generated approximately:

* 4 billion PSP transactions
* 133 billion USD direct revenues
* 363 billion USD GNP – (after applying the GNP multiplier effect of x2.5 for “Domestic” revenues and x5 for “Foreign” or “Export of Services” revenues)

High Margin, High Value-Added Growth in order to Maximize the Desire Sector’s Contribution to Thailand’s GNP & the Re-Stimulation of Economic Growth in Southeast Asia and the World

While some might say that Thailand’s Desire Sector is already contributing more than its fair share to Thailand’s, Southeast Asia and the world’s GNP, the Thai government’s recent proposal and plan presented at the G-20 and Apec to put in place a number of focused measures to stimulate further rapid growth in Thailand’s Desire Sector has garnered almost universal admiration and praise and, per the analysis below, will add a total of 87.5 billion USD to Thailand’s 2010 GNP.

The question at hand is not whether or not to go ahead with the proposal and plan but to ensure that the proposal and plan has the correct focus and implementation sequence to achieve success.

What follows are the various targeted market segments and the concrete policies that either are already being implemented or need to be implemented in order to maximize each segment’s revenue, margin, value-added and contribution to Thailand’s overall GNP.

1. Thai Male/Thai Female Heterosexual PSP Segment

The Thai male segment with approximately 2.9 billion PSP transactions per year is just about at its limit in terms of:

* additional discretionary funds available for consumption
* available time available in any given week
* degree of personal complications and scheduling

However there is one area where there is room for additional growth among the Thai male group and that is in the executive club/5 star entertainment Area which is both very high value-added and has very high margins.

With many top flight hotels in the Bangkok, Phuket and Pattaya areas at 50% or less occupancy, the government will immediately implement a low-interest loan program to convert the empty floors and rooms into executive clubs/5 star entertainment centers.

The basic value-added is that for every USD spent on:

* hi-end interior design/decoration
* application of sophisticated music/background ambiance technology
* enhanced/designed use of mood lighting/shadow/darkness
* scientific use of newly developed scent and pheromone technology
* silk dresses and sexy Victoria’s Secret-type lingerie for the Service Staff
* unlimited complementary availability of generic Erectile Dysfunction (ED) tablets

Not only can the present transaction velocity be substantially increased, the value of each PSP transaction will increase by 300% from the present Thai male average PSP transaction cost of 30 USD to 90 USD.

Multiply the additional 60 USD per PSP transaction by the average of 3 PSP present transactions per week by the 100,000 higher income Thai males (aka the Hi-So Male Group or HSMG)

Then, add on an average of 2 incremental PSP transactions per week at the average overall cost of 90 USD per transaction by the 100,000 HSMG, and the total extra revenue volume per week generated is 36 million USD.

Overall approximately 1.87 billion USD per year of additional revenue which, once the domestic GNP multiplier of 2.5 is applied, will add a total of 4.7 billion USD to Thailand’s 2010 GNP.

2. Arab & Iranian Male/Thai Female & Thai Ladyboy Segment

In 2009, the following statistics were compiled for Arab & Iranian Male Visitors to Thailand (AIMVT):

* 500,000 who stayed an average of 14 days each for a total of 7 million AIMVT days
* Spending an average of 100 USD per day for a total of 700 million USD

By increasing the number of non-stop flights to Bangkok from the various Arab states and Iran as well as stepping up the marketing campaigns targeting Arab & Iranian males and dramatically increasing the number of ladyboys and overweight PSPs from Kazakhstan and Uzbekistan allowed to work in the Soi 3/Grace Hotel district as well as South Pattaya, in 2010, the number of AIMVT will increase as follows:

* 250,000 additional AIMVT staying an average of 21 days for a total of 5,250,000 additional AIMVT days
* Spending an average of 125 USD per day for an additional total of 666 million USD
* 500,000 present AIMVT average length of stay increased by 7 days from 14 to 21 days for an additional 3.5 million AIMVT days
* Spending an average of 125 USD per day (instead of 100 USD) for an additional incremental total of 613 million USD (the 7 additional days x 125 USD plus the additional 25 USD per day on the original 14 days)

Overall approximately 1.3 billion USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 6.5 billion USD to Thailand’s 2010 GNP.

3. Japanese Male/Thai Female PSP Segment

The Japanese Male Executive in Thailand segment (mainly hi-end KTV/hostess venues and “special services” hole-in-the-wall massage places), is already thoroughly saturated and, given that most Japanese Male Executives in Thailand actually have to go home to their wives at some point at the end of each night out, there is very little additional revenue to be squeezed out of this particular segment.

In regard to the more promising Japanese Male on a Golf Holiday in Thailand (JMGHT) segment, in 2009 there were approximately 1.2 million JMGHT visitors to Thailand, each one averaging 7 days and spending an average of 200 USD per day for a total revenue of about 1.7 billion USD per year.

With additional marketing and incentives, an additional 200,000 JMGHT visitors can be generated, the average stay can be increased to 8 days and, with certain relatively inexpensive but crucial enhancements around the 18th hole area of Thailand’s many excellent golf courses, such as the construction of small but comfortable “19th Hole Cabanas,” a significantly higher spend rate per day can be achieved, perhaps as much as 30 USD per day per JMGHT.

Overall, this would result in approximately 900 million USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 4.5 billion USD to Thailand’s 2010 GNP.

4. Japanese Female/Thai Male PSP Segment

Another often overlooked but productive and high margin market segment that can be further developed is the Un-Married Japanese Woman over Thirty on Holiday in Thailand (UMJWTHT). At present, there are approximately 200,000 UMJWTHT visitors per year, staying an average of 10 days and spending a total of 250 USD per day for a total revenue of about 500 million USD per year.

By fully leveraging the already installed and well-established Male PSP labor pool and facilities infrastructure in and around the Surawong/Silom area of Bangkok, the Paradise Hotel area of Patong and the Boyz Town area of Pattaya, so that the “booked and in-use PSP productivity rate” increases from its present “gay-only” level of about 40% to a “mixed gay and heterosexual” level of 80%, a tremendous amount of additional margin can be achieved with very little additional investment or manpower.

This would in turn not only attract even more UMJWTHT, perhaps an additional 100,000 per year, but also add 2 days to the average stay and increase the spend rate by as much as 50 USD per day.

Overall, this would result in approximately 600 million USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 3 billion USD to Thailand’s 2010 GNP.

5. India Male/Thai Female PSP, Thai Ladyboy PSP & Thai Male PSP Segment

India, with its recent economic advances, is a growing source country for Male Visitors to Thailand (IMVT), in 2009, about 450,000 Males out of 700,000 total visitors from India. There is also a rapidly growing group of middle-income and above Indian Male Residents of Thailand (IMRT), now numbering about 100,000.

At the moment, due to various Indian traditions centering around sexual modesty and an emphasis on marriage and family values, the Indian IMVT and the IMRT are not an important contributor to Thailand’s Desire Sector. However, with the proper marketing and adjustments/adaptations, we are confident that these barriers can be successfully overcome and that there is a large future potential in both of these segments.

Indian-style nightlife can be developed with Indian décor, pop music and dancing. Thanks to the historical presence of Hindu/India/Sri Lanka people in parts of Thailand and the surrounding countries, women, men and ladyboys with Indian-style features such as longish rather than round faces, narrow noses and darker skin can be recruited, trained and fitted out with Indian-style wardrobe and jewelry.

The need for discretion among the older Indian males can be met by re-designing the entrance areas of massage and other personal “entertainment” venues so as to ensure rapid initial processing and an absence of inter-customer contact, especially in those venues staffed by ladyboy and gay PSPs, an area of apparent interest among both the IMVT and IMRT segment.

More importantly, racial tolerance programs will need to be introduced so that Thai PSPs are better able to accept and welcome IMVT and IMRT as clients with a warm and inviting Thai smile.

On the IMVT and IMRT side, the traditional price and time expectations brought to Thailand from India, need to be adjusted upwards from less than 5 USD and 20 minutes per PSP transaction to a level closer to Thai standards, for instance, a minimum of 30 USD and 60 minutes per PSP transaction. And some Indians need to be gently weaned away from the tradition of “sharing” a single PSP among a group of four or five clients in a single hotel room.

Once these adjustments and adaptations are in place, the present level of revenues being generated from the IMVT and IMRT segments, about 213 million USD per year of direct revenues or, (after the Export of Services GNP multiple of 5 is applied), about 1.1 billion USD, can easily be doubled adding a net total of 1.1 billion USD to Thailand’s GNP.

6. Malaysia Male/Thai Female PSP, Thai Lady Boy PSP, Thai Male PSP Segment

About 50,000 Malaysian Men visit Southern Thailand every week, 2.5 million every year, most of them to Had Yai, a major center of nightlife/PSP business with tens of thousands of hotel rooms and thousands of bars, nightclubs, massage places, KTV’s, snooker places, “barber shops,” a Boyz Town district and even 3 or 4 Ladyboy revues.

The average visit is three days during which each Malaysian Man has an average of 4 PSP transactions at an average cost of 30 USD or a total of 120 USD per Malaysian Man per visit for a grand total of 320 million USD per year which, when multiplied by the Export of Services GNP factor of 5, comes to 1.6 billion USD of Thailand GNP.

With all sectors (male/female, male/male, male/ladyboy) already saturated and generic ED stimulants already freely available at every possible venue, and all weekend flights already relatively inexpensive and fully booked, there is little potential for any significant increase in either the volume or value of this particular market segment.

However there is a potential to provide a more cost-efficient PSP experience for Malaysian Males by exporting large numbers of Thai female, male and ladyboy PSPs to Malaysia, instead of constantly importing Malaysian men into southern Thailand, an idea which will be analyzed and discussed in the Remittance section below.

7. Korean Male/Thai Female PSP Segment

The Korean Male Executive in Thailand segment (mainly hi-end KTV/hostess venues and “special services” hole-in-the-wall massage places), is already thoroughly saturated and, given that most Korean male executives in Thailand actually have to go home to their wives at some point at the end of each night out, there is very little additional revenue to be squeezed out of this particular segment.

In regard to the more promising Korean Male on a Golf Holiday in Thailand (KMGHT) segment, in 2009 there were approximately 800,000 KMGHT visitors to Thailand, each one averaging 7 days and spending an average of 200 USD per day for a total revenue of about 1.1 billion USD per year.

With additional marketing and incentives, an additional 150,000 KMGHT visitors can be generated, the average stay can be increased to 8 days and, with certain relatively inexpensive but crucial enhancements around the 18th hole area of Thailand’s many excellent golf courses, such as the construction of small but comfortable “19th Hole Cabanas,” a significantly higher spend rate per day can be achieved, perhaps as much as 30 USD per day per KMGHT.

Overall, this would result in approximately 550 million USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 2.75 billion USD to Thailand’s 2010 GNP.

8. Chinese-HK-Singapore-Taiwan Male/Thai Female PSP Segment

About 1.2 million persons who are ethnically Chinese from China, Taiwan, Hong Kong and Singapore visit Thailand each year for an average stay of 12 days. 800,000 are Chinese Males who, on average, during their stay in Thailand, enter into 9 PSP transactions each at an average cost of 60 USD per transaction for a total yearly revenue of 432 million USD.

As China itself becomes more prosperous and more Chinese can afford overseas travel/holidays and have higher discretionary incomes, it is anticipated that in 2010, there will be 900,000 Chinese males who visit Thailand for an average stay of 14 days, each one entering into 10 PSP transactions at an average cost of 60 USD.

Overall, this would result in approximately 110 million USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 550 million USD to Thailand’s 2010 GNP.

In addition, each Chinese Male visiting Thailand purchases an average of 4 Traditional Thai Massages during his stay in Thailand. Each traditional Thai massage last for two hours at an average cost of 15 USD including tip.

In order to maximize the return on the already in-place investment of the many traditional Thai massage venues, each with an already in place and well-trained staff, it will soon be required that all traditional Thai massage transactions include mandatory “special services” at an average extra cost of 30 USD.

Overall, this would result in 108 million USD of additional revenue from the Chinese visitor market alone which, once the Export of Services revenue multiplier of 5 is applied, will add a further 540 million USD to Thailand’s 2010 GNP.

9. Male Farang Tourist-Farang Resident/Thai Female PSP Segment

While male farang tourists and male farang residents receive an inordinate amount of worldwide media attention in regard to Thailand’s Desire Sector, in 2009, male farang/Thai female PSP transactions (a total of about 43 million per year) comprised only slightly more than 1% of the Thailand Desire Sector’s overall volume of 4.1 billion Thailand PSP transactions per year.

Even after the Export of Services GNP multiplier is applied, the male farang/Thai female PSP market segment contributed a relatively minor 3.6% of the overall GNP generated and spun off by the Thailand Desire Sector in 2009.

However there are areas in this market segment where substantial additional volume, value-added and higher margins can be achieved.

Large Plasma TV’s & the Detrimental Effect of Satellite Sports Broadcasting

For instance, over the past few years, there has been an explosion of large plasma TV screens installed in almost all of the male farang nightlife venues in Bangkok, Phuket and Pattaya, mainly broadcasting sports, especially English Football Premier League and NBA basketball games.

An unintentional outcome of this proliferation of abundant high-quality satellite sports broadcasts has been to dramatically lower the velocity of PSP transactions among the Male Farang Expat in Thailand (MFET) sector to the point that it has now dropped to an average of only 2.5 PSP transactions per week, half the PSP transaction velocity of the Male Farang Visitor to Thailand (MFVT) market segment.

A policy directive has recently been distributed to all the Farang nightlife venues in Thailand immediately banning all sports broadcasts and allowing one of two options, either remove the plasma TV screens altogether, or use the already installed plasma TV’s as an “enhancement” device, tuned to, depending on the particular venue’s overall tone and level, the Fashion Channel, the VH1 Music Video Channel, or one of the many available porn channels, either soft-core, hardcore or cartoons.

It is predicted that this policy change will result in a 40% spike in the Farang Expat PSP transaction velocity to a more acceptable level of 3.5 per week which at an average cost per transaction of 50 USD, will result in approximately 390 million USD of additional revenue per year which, once the Export of Services revenue multiplier of 5 is applied, will add a total of 1.95 billion USD to Thailand’s 2010 GNP.

More Male Farang Visitors to Thailand Needed

In regard to the Male Farang Visitor to Thailand segment, with the proper marketing and the introduction of special “Thailand’s a total bargain” breakeven air fares on all Thai Air flights from Europe, Australia and North America, the present level of 3 million MFVT to Thailand will jump by 1 million to 4 million MFVT per year.

In addition, all MFVT will be eligible to receive 1 generic ED tablet for every thousand miles flown (including the return trip mileage) and all MFVT hotel bookings will waive any and all so-called “additional guest” charges.

This will result in the average MFVT length of stay increasing from 11 to 14 days and the average PSP transaction velocity increasing from .7/day to 1/day. Overall, this will generate 2.3 billion USD of additional revenue which, once the Export of Services revenue multiplier of 5 is applied, will add 11.5 billion USD to Thailand’s 2010 GNP.

Further Development of the Farang Retirement/Marriage Segment

In recent years a promising new segment of the male farang in Thailand market has opened up, Elderly Male Farang Retired and Married to Thai female market (EMFRMTF).

While increasing in numbers every year, the overall number of EMFRMTF is presently only around 50,000. However, the extremely hi-value added in this market is impressive.

Each EMFRMTF brings into Thailand and spends an average of 40,000 USD per year, a total of 2 billion USD per year.

In addition, approximately 70% of EMFRMTF’s transfer money into Thailand in order to build or purchase a house or condo either in their own name or the name of their Thai wife. The average transfer for this purpose is 100,000 USD or an overall total of 3.5 billion USD.

In 90% of the marriages, funds are transferred into Thailand to purchase a vehicle at an average cost of 15,000 USD or an overall total of 675 million dollars.

When each EMFRMTF finally dies, the Thai wife inherits an average of 175,000 USD in financial assets, giving a total of 8.75 billion of farang financial assets that will eventually become Thai Female assets.

If the EMFRMTF mortality rate per year remains at the present average of 5,000 and the new additions to the EMFRMTF group are 10,000 each year, there will be a net plus of 5,000 EMFRMTF per year which will generate an overall total of 1.65 billion of additional direct revenue per year which, once the Export of Services revenue multiplier of 5 is applied, will add 8.25 billion USD to Thailand’s 2010 GNP and each subsequent year following.

The Internet/Email/Sponsor Segment

Finally, a new but very fast-growing, extremely high margin and high value-added technology-driven market segment has opened up recently in the Farang area and that is the Farang Sponsor in Touch with Thai Female via Internet segment (FSTTFI).

The basic structure is as follows: Thai PSPs using the services of Thai email/internet “facilitators” initiate and maintain contact with thousands of Farang who have passed through Thailand during which time, they engaged in one or more transactions with said PSPs.

With the assistance of the Thai facilitator’s creativity and language-skills, various scenarios, scripts and stories are created and utilized in emails sent “from” the PSPs to the Farang who have since returned to their home country.

* Sick farm animals, children and parents stories
* Car, pick-up truck and motorcycle accident stories
* Desire/need to be “rescued” from their lives as PSPs stories, etc.
* Wish to upgrade their “relationship” to the enhanced so-called “sponsor” level story

The results even at this early stage of this segment’s development are impressive. Approximately 60,000 Thai females are presently in regular email contact with 5 FSTTFI’s at any point in time. For every 10 emails sent each week, some kind of money transfer is generated, averaging 100 USD per week or 5200 USD per year per Thai female for an overall total of 312 million USD per year.

In addition, out of the overall total of 300,000 FSTTFI’s in regular email contact with Thai females, about 5% or 15,000 become so-called “sponsors” entitled to special booking privileges on their return trips to Thailand as well an enhanced level of the so-called “Thai girlfriend experience.” The average transfer required to become a “sponsor” is 1,000 USD per month or 12,000 USD per year, an overall total of 180 million USD.

While all of this is a very impressive example of spontaneous Thai ingenuity and entrepreneurship in action, with more focus, organization and development – language skills training, banking/transfer skills, passport fees to be waived, more complex, varied and plausible “stories” developed, etc – this segment can expand by a minimum of 50% per year for at least the next ten years.

Overall, this would result in 246 million USD of additional revenue in 2010, which, once the Export of Services revenue multiplier of 5 is applied, will add a further 1.23 billion USD to Thailand’s 2010 GNP.

10. Russians in Pattaya Segment

Four hundred thousand Russians, about half of them men visited Thailand in 2009, staying an average of 14 days each for a total of 2.8 million Russian Men in Thailand (RMT) days. The average spend rate per Russian Man in 2009 was 75 USD per day or 210 million USD in total.

Despite almost all the RMTs being accompanied to Thailand by their Russian wives, each RMT on average made 3 visits per week to “special services” massage venues at an average cost of 50 USD per visit, a total of 60 million USD.

Due to a very high rate of extreme obesity among the RMT, (as well as the constant presence of their wives perhaps), the PSP transaction rate for RMTs outside of the “special services” massage area is statistically insignificant.

As the number of RMT visits to Thailand, especially to the Pattaya area, is expected to increase by 20% a year over the next ten years, it is worthwhile for the Thailand government to devise and develop certain long term policies in order to increase the RMT level of PSP consumption and revenue by:

* Introducing special training courses for PSPs to acquire obesity sex techniques
* Developing more “Russian-friendly” PSP venues such as traditional Russian-style men-only-bath-houses which would add a “Thai touch” in the form of special bath attendants
* Building and marketing special weight-loss spas for RMTs which would include, in addition to the standard dietary, exercise and group discussion procedures, “Special Personal Aerobics Weight Loss Trainers”
* Considering the possible development and revenue potential of special PSP venues and programs for Russian Females/Wives which would be staffed by young, handsome and well-built Thai PSP males

All of the above improvements, once they are implemented, will gradually increase the amount of PSP revenue from the RMT segment but the increase will not be statistically significant until at least 2012.

11. The Remittance/Overseas Thai Female/Male/Ladyboy PSP Segment

In 2009, the remittance/overseas segment of the Thailand Desire Sector (about 100,000 PSPs) generated 1.67 billion USD of direct revenue which translated into 8.35 billion USD of Thailand GNP.

The potential to increase the level of this market segment is dramatic, possibly a doubling of the present revenue level, if the correct government policies can be swiftly and effectively implemented.

A much higher volume of PSP trafficking/transport/facilitation to certain key markets (which include Malaysia/KL, Singapore, Taiwan, Hong Kong, Macau, Japan, Korea, the Gulf States, the U.S., Canada, England, Germany, France, Scandinavia, Switzerland) will require a full-scale effort not only by various government officials and departments but also by the PSP labor pool and include the following:

* Free passports to be issued within 24 hours to all Thai PSPs willing to work outside of Thailand a minimum of one year
* Interest-free travel loans/advances to be approved and issued with 24 hours notice
* Regulation of traffickers/agents who are at present stifling growth due to the negative effect of their extreme predatory behavior
* Export focus on more hi-revenue hi-margin, hi-productivity, hi-endurance, lo-maintenance ladyboy PSPs
* Export focus on more hi-revenue, hi-margin Gay PSPs
* Introduce training courses for female PSPs to increase their knowledge of the pro’s and con’s of the various destination points, revenue maximization techniques, money transfer procedures and also to alleviate their fears of journeying to unknown places where they will be controlled and abused by violent and vicious criminal gangs.

If the goal of exporting an additional 50,000 overseas/revenue/remittance PSPs is achieved in 2010, and especially if a higher percentage of ladyboy and gay PSPs are successfully exported, the result will be an additional 900 million USD of additional revenue in 2010, which, once the Export of Services revenue multiplier of 5 is applied, will add a further 4.5 billion USD to Thailand’s 2010 GNP.

12. The So-Called “Underage” Segment

Some years ago, Thailand’s Desire Sector was well-known around the world for its large and thriving so-called “underage” market segment which catered to not only Thai adults but adults from all over the world who were interested in having sex with so-called “underage” males and females.

For whatever reasons, starting in around 1985, Thailand allowed this lucrative and dynamic market segment to gradually migrate to Cambodia, its less prosperous and more desperate neighbor to the east.

However, now that Cambodia has demonstrated an apparently endless and ongoing hostility towards Thailand and Thailand’s interests, it is time to re-consider Thailand’s earlier generosity and to take back this very high margin, high value-added market segment.

To those NGO groups and governments around the world who might object to this, Thailand’s answer is:

Thailand is not an occupied colony of the Western democracies. Why should Thailand allow so-called humanistic Western values and the West’s obsession with so-called human rights to interfere with and override traditional Southeast Asian values that go back some thousands of years.

Since the earliest recorded Southeast Asian history, the vast majority of Southeast Asian people have followed the belief that whenever a young female reaches puberty (aka “sexual maturity”), it is only natural and good that she be made available for sexual relations and marriage. And that the natural and wholesome path for young males is to engage in sexual activity and play whenever their biological desire dictates.

In any case, there are many fully-grown, so-called “adult” females inhabiting Thailand and the surrounding countries to the east, north and west, especially from various “ethnic minorities,” who are physically of very small stature and, at least to non-Asian eyes, who appear to be “underage” even though they may be well into their 20s.

After considerable feasibility studies in regard to what would be required in order to re-construct this dormant market segment, how much manpower would be needed and what levels of transaction volume and revenues could be achieved, the bold and courageous decision has been taken to go full steam ahead.

In regard to staffing, the goal for the first year is to have 100,000 so-called “underage” female and male PSPs up and running. This will require the following policies to be maintained and implemented:

* the average school leaving age should continue to be no higher than 14/15-year-old (end of 8th grade)
* a national system of ID’s will need to be developed which will blur and disguise the actual age of each PSP to avoid bothersome NGO and foreign media attention
* more “discretion style” venues will need to be developed so the activity is not visible
* the income levels of the less developed areas of Thailand’s northeast and north will need to stay low so that the parents have sufficient economic incentive to accept loans/advances against their children’s services and the children themselves have no other meaningful economic opportunities
* the system of government pensions should also remain so low as to be meaningless economically in order to ensure that the parents are dependent on their children for their income once they can no longer work

In regard to the training needs of such a large labor pool:

* the vast majority of male and female PSPs will have spent their early life on small farms where the various farm animals are constantly having sex with one another in full public view
* almost all of the male and female PSPs will have spent many months and years taking care of water buffalos which in many ways are very similar to large, slow-moving foreign people
* DVD and internet pornography is now widely available and consumed throughout Thailand, giving the male and female PSPs a significant head start in knowing what to do
* Buddhist training will be provided to the male and female PSPs so that they are able to maintain “detachment,” “a state of equilibrium,” “mindfulness” and “purposeful intention”

Once the first hundred thousand of these so-called “underage” PSPs are in place and economically active, the volume level per PSP should average 4 transactions per day, 28 days per month, at an average revenue per transaction of 60 USD. The target is for 80% of the revenue to be Export of Services revenue and 20% to be “Domestic Revenue.”

Overall, this would result in 8.1 billion USD of additional revenue in 2010, which, once the Export of Services revenue multiplier of 5 is applied to 80% and the “Domestic” revenue multiplier of 2.5 is applied to the remaining 20%, will add a further 36.3 billion USD to Thailand’s 2010 GNP.

13. The Iranian Sex Change Operation Medical Tourism Related Segment

Despite being considered a “theocratic state” under the sway of an extreme form of Islam, Iran has one of the world’s largest populations of transsexuals/transvestites. Twenty thousand according to official government statistics and one hundred and fifty thousand according to informal studies.

Surprisingly, in a country where homosexuality is actually illegal, Iran’s transsexuals/transvestites are given legal status and protections. The government of Iran actually provides funding for sex change operations and also loans/advances for transsexuals/transvestites to start small businesses.

As a result, Iranian surgeons perform more sex change operations than any other country with the exception of Thailand. However the skill level of Thailand’s sex change surgeons remains world-class and at the cutting edge. Given a choice, most Iranian transsexuals/transvestites who desire to have a sex change operation would prefer the services of a Thai sex change surgeon and in 2009, about five thousand Iranian transsexuals/transvestites actually travelled to Thailand to do this.

In 2009, the average expenditure for each Iranian Sex Change Tourist (ISCT), including surgeon and hospital fees, hotels, meals and incidental expenses, is 5000 USD, a total of 25 million USD of direct revenue or, once the GNP Export of Services multiplier of 5 is applied, 125 million USD.

Thailand’s hospitals and sex change surgeons already have the capacity in place to handle a much higher volume level of ISCT’s and with the proper marketing and packaging, it is possible to at least double the present numbers as well as to increase the overall price levels by 20%.

Overall, this would result in 35 million USD of additional revenue in 2010, which, once the Export of Services revenue multiplier of 5 is applied, will add 175 million USD to Thailand’s 2010 GNP.

14. Further Notes on the Thai Ladyboy Segment

The ladyboy market segment is one of the highest margin, highest value-added and highest transaction rate per day areas of Thailand’s Desire Sector. Thailand’s thousands of ladyboy PSPs are creative, entrepreneurial, self-reliant and energetic in constantly seeking out ever more clients and ever more sources of income from each client.

Recognizing their contribution, the Thai government has taken steps to encourage more ladyboys to become active in the Desire Sector, to help create a larger overall ladyboy infrastructure and many more venues, especially a much larger number of “discretion venues” which are a key element driving the increase in the Desire Sector’s ladyboy PSP utilization rate.

15. Further Notes on the Thai Gay/Lesbian Segment

The gay/lesbian sector of Thailand’s Desire Economy is maxed out in terms of transaction velocity, utilization of venues and gay/lesbian-friendly hotels. There is a desperate need for more gay and lesbian PSPs and more high-margin venues like the world famous Babylon Sauna/Massage and the Bangkok, Pattaya and Patong streets known as Boyz Town.

One of the problems is that there is a very high education level among Thai gays and lesbians, allowing them to successfully pursue lucrative careers in numerous economic sectors rather than being economically pressured or obliged to work as a PSP in the Desire Sector.

The only solution is for Thailand to look outside its borders and to immediately organize recruiting programs and trafficking networks in order to import large numbers of non-Thai gay and lesbian PSPs into Thailand. Fortunately, the Thailand Border Police already have a vast experience and expertise in the recruiting/trafficking area and now that they have been given the green light, we anticipate that there will soon be a regular flow of imported gay and lesbian PSPs into Thailand.

In regard to the need for more high-margin venues, the Thailand government has already implemented a low-cost loan program to convert much of the under-utilized hotel space in the Silom and Ratchada districts of Bangkok as well as South Pattaya and Patong into suitable high-margin venues for gay and lesbian Desire Sector activity.

16. Some Additional Notes & Comments

Sex Inside Marriage/Long-Term Relationships

The Negative GNP Impact of sex inside marriage/long-term relationships is a well-known economic phenomenon which needs to be addressed by any country seriously wishing to maximize the GNP impact of its Desire Sector. Every sexual encounter within the confines of marriage and long-term relationships has an economic opportunity cost that can never be retrieved. Whereas sexual encounters with PSPs not only create the GNP value of the actual transaction but also trigger the GNP Multiplier Effect, adding further value to the actual transaction and resulting increase in a country’s GNP.

Point of Sale/Impulse Buy Revenues

In order to maximize Point of Sale revenue and to encourage a high rate of impulse buy behavior in the Desire Sector, it is essential to have as many Desire Sector venues as possible spread across as wide a geographic area as possible. Much like the 7-11, Starbucks, McDonald’s phenomenon in regard to impulse consumption of caffeine, sugar, salt and carbohydrates.

Even if some of the venues are very small, their ubiquitous presence will encourage and allow the most momentary Desire impulse and thoughts to be realized immediately, thereby capturing GNP revenue that might otherwise never exist and will be lost forever.

The Thailand government policy of encouraging the establishment of small “special services” massage venues on almost every block of every city and town in Thailand, along with the universal presence of ATM machines and immediately available and low-cost generic ED tablets at all pharmacies (i.e., without the need for a prescription), is a useful example and model for the rest of the world to follow.

Other small PSP venues spread across a wide geographic area throughout Thailand include barber shops, snooker halls, department store perfume sections, dry cleaners with special delivery staff, restaurants, hotels, convenience stores and petrol stations with special service staff, etc. The only limit to how many forms such small PSP venues can take is the human imagination.

Re-Defining “Short-Time”

As a matter of custom and tradition, most PSP transactions in Thailand are referred to as “short-time” transactions and last about two hours. In order to maximize the output of Thailand’s already installed facilities and PSP base, it would be useful to re-define “short-time” to mean a maximum of only one hour.

If such a re-definition were successfully implemented and accepted, it would have an immediate impact on the volume of potential PSP transactions per PSP in any given 12 hour shift and significant positive effect on revenue and GNP levels per PSP and per venue.

17. Final Thoughts

Only in a deeply Buddhist country and spiritual society like Thailand could such a large-scale Desire Economy exist without at the same time gradually eroding, corrupting and destroying the moral and cultural fiber of the people, their institutions and the nation itself.

Thailand and the Thai people can be very grateful for Buddhism and how the Buddhist system is applied in Thailand.

* Detachment – Helps PSPs avoid self-pity and depression no matter what their circumstances, allows PSPs to successfully extend their career span to ten or more years
* Belief in Karma – Providing Good Service leads to a better life next time and a PSPs position in this life, no matter how low, unpleasant and degrading is their own responsibility from a past life lived badly
* Desire as Illusion – Commercial sexual relations, venues and the surrounding degeneracy are not real
* Purposeful Intention – Wish to take care of their children and family relieves PSPs of the psychological burden created by unpleasant environments, situations, actions and activity
* Mindfulness – Helps PSPs maintain ability to project “goodness,” “cheerfulness” and “willingness” in the face of desperation, destitution, depravity and evil

(Disclaimer: The opinions expressed here represent the author’s and are entirely from his own experience. Furthermore, they do not necessarily reflect the views of the the people who live in the author’s hemisphere and the individual letters, words and punctuation marks involved had no option but to be placed into the story, and should not be held accountable for the author’s statement. Any spelling or grammatical errors are not the responsibility of the schools the author attended, the teachers the author was taught by, the regional governments who did or did not fund the author’s educational system, or anyone else involved in the author’s life.)

Sphere: Related Content

Related posts on absolutelyBangkok.com:

1. Dr. Saul: Thailand To Tackle World’s Desire Deficit
2. Dr. Saul: Ratchada’s GNP Factor
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4. Before America Came, Thailand Was Pure
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