Time to woo more people to the country

The new govt aims a figure of 30m visitors that could also bring in RM100b in tourism receipts


Some five years ago, Malaysia was visited by 27.4 million tourists — a number that almost equalled the country’s population.

It was certainly quite an achievement for the country, especially when flocks of tourists from all over the world converged to enjoy all the diverse offerings the country has to offer.

Nevertheless, while the number was pretty impressive, it has to be put on record that the visitors were mainly from the region, namely the South-East Asian tourists.

The previous government had forecast that 36 million tourists would arrive in Malaysia by 2020, which could potentially translate into RM168 billion in earnings and tourism receipts.

The new government, however, has decided to shave the target a little lower to a more realistic figure of 30 million visitors that could also bring in RM100 billion in tourism receipts.

The lower figure is also based on the recent declines in the number of tourists. In 2017, Malaysia received 25.9 million visitors and the number went down slightly to 25.8 million in 2018, a million less than the number reported in 2016.

According to the latest report by the Ministry of Tourism, Arts and Culture (Motac), the 0.4% fall was mainly due to the drop in footfall from Asean visitors, which was recorded at 7% year-on-year (YoY).

The drop was translated into a 12.8% earnings decline from the segment to RM48.5 billion from RM55.6 billion in 2017.

Last year, only 10.6 million Singaporeans visited the country, a 14.7% drop from the previous year.

Malaysia needs to revamp its products such as Batu Caves and the museums, so they could offer a better experience to the guests, says an expert (Pic by Muhd Amin Naharul/TMR)

Laos, Myanmar and Brunei also recorded a dip by 39.7%, 9% and 16.8% respectively last year compared to 2017.

Despite the declines in the number of Asean visitors, the overall revenue for the tourism industry slightly increased by 2.4% to RM84.1 billion.

The per capita expenditure also grew by 2.9% to RM3,257, while the average length of stay (ALOS) climbed by 0.8 points to 6.5 nights.

Both factors were contributed by the medium and long-haul destinations, which grew 22.3% and 13.3% with a market share of 20.3% and 9.6% respectively.

West Asia recorded the highest per capita expenditure growth at 6.1% (RM9,947), while Asean expenditure dropped by 6.2% (RM2,678).

The UK, Sweden, India, Russia, the US, South Korea, Japan and China were countries that recorded growth in per capita expenditure as well.

Apparently, Malaysia is still heavily relying to the Asean market, while more steps should be taken to push the number of visitors from Europe and other parts of the world higher.

Govt-Industry Collaboration

As it is, medium-haul flights of between three and six hours cover visitors from China, South Korea, Japan and India, while flying time above six hours is considered long-haul flights.

As there are encouraging markets from both classes, the government and industries are expected to work hand in hand to increase footfall from new target countries.

As we speak, officials from Motac are already on their way to Berlin, Germany, for the Internationale Tourismus-Borse (ITB) festival slated from March 6 to March 10, in an effort to reach out to more tourists from that region.

Motac Minister Datuk Mohamaddin Ketapi said the ITB Berlin is instrumental in boosting the number of visitors to Malaysia.

For the European market, Tourism Malaysia is also expected to “sell” the country’s cultural uniqueness.

“This has resulted in a mixed, yet harmonious legacy that manifests itself in Malaysia’s architecture, clothing, language, cuisine and other aspects.

“As such, the highlight of our presence at ITB this year will be the cultural aspects that we bring to the show,” Mohamaddin said recently in a news report.

Last January, Tourism Malaysia and Malaysia Airports Holdings Bhd (MAHB) signed a memorandum of understanding (MoU) for the Joint International Development Tourism Programme.

The MoU will pave the way for possible cooperation between the two parties, especially in the areas of international tourism promotion.

Under the MoU, both parties will contribute up to RM10 million each which will be disbursed to eligible industry players, for the purpose of marketing and promoting Malaysia to the international audience.

Among the initiatives planned are airlines collaboration, the operation of inaugural and charter flights, as well as high-yield niche tourism promotion. The same initiative, done in 2018, already succeeded in covering 20 main projects for the short and long-haul markets by the government agency, while MAHB is working on airport and route developments.

Over the past several years, 50% of the total passenger traffic has been contributed by international visitors.

Last year, the airport operator welcomed 11 new airlines and more than 40 new services (routes) to international destinations, registering a total of 99 million passenger traffic movements for Malaysia.

Flight Connectivity vs Product Improvement

In a press conference recently, newly appointed Tourism Malaysia DG Datuk Musa Yusof said the country’s flights connectivity is still rated at low par, compared to neighbouring countries.

He said while tourists are keen to visit Malaysia, the transportation mode also needs to be ready to cater to such demand.

“Presently, we do not have the advantage of connectivity compared to our neighbouring countries,” he said.

The ministry has already attracted some foreign-based operators such as Condor Airlines to Malaysia.

Germany-based tour operating giant TUI Group has already received the nod to begin its operations in Malaysia, its first South-East Asian office, which will add more fleet into the country.

The Malaysian Aviation Commission (Mavcom) chairman Dr Nungsari Ahmad Radhi said such a “chicken and egg situation” would heavily rely on the supply and demand situation.

In order to boost demand from international tourists, Nungsari says there must be attractive reasons for airlines to be part of the growth in the country (Pic by Ismail Che Rus/TMR)

He said on the supply side, no airline would ignore routes that are profitable for them.

“If profitable, airlines will operate the routes. There is no issue about permits or approval for them to operate.

“Having said that, yields for Malaysian flights are low — profit margins are somewhat low, making the routes unattractive to airlines,” he told The Malaysian Reserve (TMR).

In order to boost demand from international tourists, Nungsari said there must be attractive reasons for airlines to be part of the growth in the country.

“Malaysia as a destination, either for holiday or business, must be attractive. An example is Kota Kinabalu which has been receiving a strong demand from East Asia, Korea and parts of China.

“It’s a cycle of supply and demand,” he said, adding that the airport operations must be also efficient and consumer-friendly for airlines and passengers.

In 2018, the air traveller mode increased by 35.7% compared to the previous year, while the usage of land transportation dropped by 14.4% YoY.

Revamping Tourism Products

Malaysian Inbound Tourism Association (Mita) president Uzaidi Udanis said it is crucial to revamp tourism products and offer visitors a better experience in the country.

“We need to revamp our products such as Batu Caves and the museums, so they could offer a better experience to the guests.

Mita is currently travelling throughout the country for its inbound tourism boot camp that teaches industry players to create new products based on experiences, says Mita’s Uzaidi (Pic by Ismail Che Rus/TMR)

“Besides connectivity, we would also need to revamp our products — the way we promote them — so they could get a better view of how they will spend their days here. If we could do that, it will make them stay longer,” he told TMR.

He added that Mita is currently travelling throughout the country for its inbound tourism boot camp that teaches industry players to create new products based on experiences.

As of last year, tourist expenditures were centred on shopping (33.4%), lodging (25.7%), and food and beverages (13.4%).

Motac said Malaysian handicrafts are the most popular items bought by tourists, besides food and beverages.

Business tourism is predicted to contribute RM3.9 billion to gross national income and create 16,700 jobs by 2020.

While the country is struggling to make the Visit Malaysia 2020 a dream come true, neighbouring countries such as Vietnam and Thailand are currently enjoying double-digit growth in tourism arrivals.