Thailand's once-booming tourism industry is scrambling to arrest a slump in foreign visitor numbers after a military coup and a night-time curfew tarnished its reputation as the "Land of Smiles".

While most tourists in the Southeast Asian nation barely noticed when the generals suddenly seized power on May 22 in a bloodless coup, the impact is starting to be felt with many hotel rooms in the capital unoccupied.

"Hotels were dramatically hit," said a manager at a luxury hotel in Bangkok whose occupancy rates have fallen below 30 percent, compared with above 70 percent a year ago.

Foreign visitor numbers nationwide slumped 10.6 percent in May compared with a year earlier, to roughly 1.74 million people, the tourism and sports ministry reported on Friday.

Bookings had already suffered because of months of political unrest, and the government has lowered its forecast for tourist arrivals this year to 25.9 million, down from an initial target of 28 million.

Asian tourists have been particularly spooked, with visitors from Hong Kong, Japan and Taiwan quick to cancel.

"Hong Kong people treat safety very importantly because travelling is part of their daily life," said Steve Huen, executive director of EGL Tours, which has stopped promoting package trips to Thailand due to an industry advisory.

The Hong Kong government has issued a "red" travel alert, urging citizens to avoid non-essential travel.

Drawn by its sun-soaked beaches and hedonistic nightlife, the kingdom welcomed a record 26.5 million foreign visitors in 2013.

But months of street protests and political bloodshed have taken their toll on the key sector, particularly in the capital Bangkok.

On Khao San road, renowned as one of the busiest hubs for backpackers in Southeast Asia, local businesses are suffering.

"After the coup, I have only earned a little. Things are harder than before," said stallholder Phongsathorn Wongchuen.

- Curfew relaxed -

The junta and tourist officials have now launched a campaign to try to reassure tourists that it is safe to visit.

Army commander-in-chief Prayut Chan-O-Cha said in a weekly address to the nation Friday that foreigners were welcome -- but only if they behave.

"They shouldn't come to Thailand to do anything illegal," he said, criticising foreign films for portraying the kingdom in a sleazy light.

"They came for drugs and for bad things," he said. "I feel embarrassed. Aren't you embarrassed when they put it in their foreign films?"

In an attempt to lure back tourists, the curfew has now been lifted in most major beach resorts including Pattaya, Koh Samui, Phuket and Krabi.

Ravers will also be able to dance until dawn at the notorious full moon party on Koh Phangan after the junta granted a curfew exemption for June 9-13.

Since deposing an elected government, the ruling generals have curtailed civil liberties by banning public protests, censoring media and temporarily detaining hundreds of critics for questioning.

But international flights are still in operation, with those travelling to and from airports among the few exempt from the curfew.

"We feel that it is safer than in France. Even if there were some riots, they were covered a lot on TV, we feel really safe and we haven't seen anything out of the ordinary," said Yoann Vella from France.

One issue is travel insurance which may not cover holidaymakers during periods of unrest, particularly if their government has warned against non-essential travel.

- Bookings slump -

On the day after the coup, airlines saw roughly 5,000 cancellations for flights to Thailand, compared with roughly 28,000 inbound bookings on May 19, according to figures from travel data firm ForwardKeys.

Daily bookings have since begun to rebound but remained about 50 percent lower at the end of May year-on-year.

European tourists are often less quick to cancel than their Asian counterparts, with French and German tour operators reporting only a small impact on demand.

Thailand's popularity has endured several episodes of civil strife in the past, including in late 2008 when hordes of frustrated travellers were stranded after protesters staged a nine-day blockade of Bangkok's two airports.

"Thai people actually are such a great nationality and great ambassadors that people always come back," said Deepak Ohri, chief executive of Lebua Hotels and Resorts.

In the days after the coup, the five-star Lebua hotel saw hundreds of cancellations and bookings dropped nearly 70 percent.

But since the curfew was relaxed the hotel says business is returning to normal.

"Whether there is a tsunami, whether there are floods or whether it is a political issue, guests always come back," said Ohri.