7/28/2019 Inside Investor - Tourism
2/3InsIde MALAYsIA JULY 2012110
overview
TOURISM & HOSPITALITY
A muli-ehnic counry blessed wihlush rainoress and sunning
species o
wildlie, Malaysia has a naural advanage
or reeling in ouriss. Add o he mixure
a ascinaion wih shopping ceners and
experience in halal services, and you sar
o see he reason or he appeal. Malaysia
saw 24.6 million ouris arrivals in 2010,
making i he ninh mos visied counry
in he world, he hree bigges markes
or ouriss being China, India as well as
he GCC.
The indusry added RM36.9 billion
o gross naional income (GNI) in 2009,making i he h larges
indusry in he
counry aer oil, gas and energy, nancial
services, wholesale and reail and palm oil.
Tourism is also he hird larges source o
income rom oreign exchange.
Though Malaysias ourism indusry is
growing a a rae o 12 per cen per annum
(2004-2009), placing i beside selec ew
oher counries ha have mainained
double-digi growh, such as Egyp,
China and Souh Arica, he majoriy o
his aciviy is buoyed by arrivals, no
expendiure yields. The counry rakedin RM30 billion in 2004 and
RM53 billion
in 2009, a period ha saw a growh o
12 per cen per annum, ranking i 13h
worldwide in global ouris receips,
which add up o an average o RM1 billion
per week. However, hese yields only
accouned or 25 per cen o growh in he
indusry, while arrivals made up 75 per
cen.
This unbalanced patern o growh
can bes be explained by Malaysias lack
o atracion owards high-yield, medium-
haul markes due o low igh requency,he endency or low-haul ouriss
o
complee high-requency rips, and use
o he counry as a ransi poin. In 2009,
only 15 per cen o ouris arrivals in
Malaysia accouned or he medium-haul
porion o he marke much lower han
he 43 per cen in Singapore and 36 per
cen in Thailand while 78 per cen came
rom he shor-haul marke and 7 per cen
rom long-haul. The soluion currenly
in play is o boos requencies beween
Malaysia and hose ciies where here
High arrivals,
low yieldsMalaysias warm weather, eco-diversity and retail
landscape help entice 24.5 million
tourist arrivals, who gross about RM59 billion. This makes
Malaysia the ninth most
travelled destination in the world, but only the 13th highest
expenditure by visitors.
Since tourism becamea signifcant source oincome or Malaysia,
thecountry has launched anumber o initiatives toboost the
sector.
TourismM
alaysia
TourismM
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7/28/2019 Inside Investor - Tourism
3/3InsIde MALAYsIA JULY 2012 111
overview
TOURISM & HOSPITALITY
is a conneciviy gap, such as Beijing,
Delhi, Melbourne, Mumbai, Osaka, Seoul,
Shanghai, Sydney, Taipei and Tokyo. Local
airlines are due o increase capaciiesand Malaysia Airpors
Holding Berhad
(MAHB) has begun o make concered
efors o atrac oreign airlines o
increase ighs o Malaysia or se up
operaions.
Since medium-haul marke adds
an exra 53 per cen yield compared o
shor-haul ouriss, and is a segmen
which is orecas o grow by eigh per
cen beween 2010 and 2020, he ourism
indusry sands o gain he mos rom
greaer conneciviy o medium-haul
ouriss.A signican conribuor o he
economy, he ourism indusry employs
an esimaed 14 per cen o he workorce.
Unorunaely, however, he indusry
aces increasing srain rom regional
markes abroad, such as Singapore, Hong
Kong and Macau, where higher incomes
draw in Malaysian workers, especially
in he hospialiy segmen. Skills are
also drained rom he indusry due o
relaively lower pay: he average income
or a Malaysian working in hosels in
resaurans averages ou a RM1,084 permonh, compared o RM2,114 in
nancial
services and RM2,621 in oil and gas, as
noed in he Economic Transormaion
Programme (ETP), Malaysias economic
ouline o achieve high-income saus by
2020.
Shopping is already a large conribuor
o ourism receips in Singapore (35 per
cen) and Hong Kong (57 per cen) and
makes up 28 per cen o he marke in
Malaysia.
This relaively lower proporion o
he marke share is largely due o highlyragmened, sand-alone
concenraions
o reail areas ha have poor conneciviy
and collaboraion beween each oher.
For example, Buki Binang in Kuala
Lumpur is disconneced rom Kuala
Lumpur Convenion Cener (KLCC) due
o inadequae pedesrian walkways,
which in urn leads o a lack o appeal and
vialiy.
Addiional pedesrian walkways and
public ransporaion has been proposed
o amend hese problems. Pedesrian
walkways o be buil will connec KLCC
o Pavilions Raja Chulan bridge, Pavilion
across Jalan Buki Binang o Fahrenhei
88 shopping cener, Fahrenhei 88 o Lo10 shopping cener, Sungei
Wang Plaza o
Berjaya Times Squares Imbi bridge, and
rom Sungei Wang Plaza o Jalan Buki
Binang-Jalan Pudu inersecion. I is
hoped ha once hese areas are linked
up ha a ashion disinc wih enough
vibrancy o atrac esivals will be
creaed.
Ouside o KL, addiional shopping
ceners are being developed in Johor
Bahru, Sepang and Penang. Iskandar
Malaysia, a large-scale propery
developmen projec in Johor Bahru,will be composed o residenial
buildings
and oher privae projecs such as
religious buildings as well as reail.
Aer compleion in 2013, i will be open
o caer o ouriss and day visiors rom
Singapore and Indonesia.
The Sepang projec is posiioned o
atrac ransi passengers rom Kuala
Lumpur Inernaional Airpor (KLIA)
and he Low Cos Carrier Terminal
(LCCT); in Penang, here is a large volume
o Indonesian ouriss ha can be
capured as hey make heir way up oneighbouring Thailand.
Cruise line ravel is a globally growing
segmen, one in which hal o passengers
are high-yield ouriss. In Souheas
Asia, Singapore is currenly leading in
he indusry because o lacking cruise
erminal inrasrucure elsewhere.
According o he Business Times, a local
business newspaper, ourism logisics
will be vamped up in Langkawi and
Penang by developing premium shopping
ceners and promoing he developmen
o appealing ourism conceps, such asenerainmen zones, cable car
services
and gol courses. Penang is also slaed o
develop wo new convenion ceners o
atrac MICE ouriss.
When compared o regional peers
Singapore and Thailand, Malaysia
has precious ew ve-sar hoels. O
Malaysias hoel indusry, ve per cen are
in he ve-sar mix, while 13 per cen are
represened in his caegory in Singapore
and 14 per cen in Thailand.
Invesmen ax allowances will be
exended o include our- and ve-sarhoels wih oreign ownership in
order
o atrac more unds o upgrade and
reurbish hoel asses. In addiion,
saring rom 2013, our- and ve-sar
hoels will have o charge a minimum
room rae. I is hoped ha his will
encourage hoeliers o work o mach
service levels wih pricing.
Hopping on he bandwagon aer
regional leader Singapore debued is
Marina Bay Sands and Resors World
Senosa, Malaysia has ploted ou
developmenal plans in he inegraedresors (IR) segmen. Aer he
opening
o Resors World Senosa in February
2010, ourism arrivals doubled, which
includes a 46 per cen increase rom
Malaysian ouriss, as noed in he ETP.
The amily-relaed ravel indusry in he
region largely caers o he burgeoning
middle-class populaions o India, China
and he Middle Eas, regions ha make
up he vas majoriy o Malaysias ouriss.
As hese cenral sraa o sociey move up
he economic ladder, hey will coninue
o conribue more o global ourism, nowonly represening 13 per cen
o global
deparures ye 48 per cen o he global
populaion.
The Malaysia Tourism Transormaion
Plan has been se up o push he goal o
achieve 36 million ouriss by 2020, rom
24.6 million in 2010, and generae up o
RM150 billion in annual revenue, rom
RM56.5 billion in 2010, which indicaes
ha he plan is eyeing a higher average
spending o he individual ouris in he
uure.
Investment tax allowances
will be extended by the
Malaysian government
to include our- and fve-star hotels with oreign
ownership in order to
attract more unds to
upgrade and reurbish
hotel assets.
