Tuesday, August 26, 2008

Tourism industry to remain robust

The local tourism industry, which generates RM10bil in receipts annually, is expected to remain relatively robust despite being beset by global and regional woes.

According to Tourism Malaysia statistics, tourist arrivals to Malaysia rose 3.9% to 12,891,202 in the first seven months of the year against 12,404,377 in the previous corresponding period.

“The modest increase suggests that the rise in fuel and transport costs over the past several years, particularly the sharp spike in world oil prices, and second quarter growth contraction in Japan and European Union countries have not yet impacted Malaysia’s tourism sector,” RAM Holdings Bhd chief economist Dr Yeah Kim Leng said.

He added that the long-haul segment, especially from the high-income countries in Europe, North America, Australia and New Zealand, recorded double-digit growth in the first seven months.

“This important segment, characterised by longer staying and higher spending tourists, constitutes about 8% of the total number of tourist arrivals in the country,” he said.

China and the Middle East were two other markets which saw significant growth in tourist arrivals - 41% and 15% respectively.

“Though their market shares, at 4.5% and 0.6% respectively, are still relatively small, the strong growth suggests good potential to expand the foreign tourist sub-sector,” said Yeah.

However, industry players are bracing for a consolidation in the tourism sector on expectations of marginal growth this year due to a slowing global economy, inflationary pressures and fuel price woes.

Malaysian Association of Tour and Travel Agents (Matta) president Ngiam Foon said that given the current scenario of high fuel prices, Government subsidies would assist its members in operating tourism vehicles.

“The recent hikes had increased our transport charges by up to 20% depending on the services and many Matta members have contracts with overseas agents of up to March 2009 based on old rates,” he said.

He also suggested grants for overseas promotion and sales trips and missions, saying that inbound tourism also played an important part in foreign exchange earnings.

Mayflower Acme Tours Sdn Bhd director and general manager Chin Ten Hoy said that 2008 and 2009 might be years of consolidation for the industry after the strong tourist arrivals of 20.97 million recorded in 2007.

“Tourists’ focus on Asia switched to China ahead of the Olympic Games in Beijing and it will continue to be on China after this,” he said.

“For long-haul tourists, the length of stay may shorten from three weeks to 14 days and the choice of hotels may switch from the 5-star category to the 4-star and from the 4-star to the 3-star,” he said.

For the upcoming Budget, he said, the company hoped to see an incentive payout scheme for travel agencies based on the number of tourists brought into Malaysia by the travel agent as well as diesel subsidies for tourist buses.

“Tourism Malaysia should continue to promote all popular destinations in Malaysia instead of promoting selectively on certain destinations,” he added.

Meanwhile, Asian Overland Services Tours & Travel group managing director Anthony Wong said next year’s budget allocation should look at product development and training of people in the tourism and hospitality industry.

Malaysian Association of Hotel Owners president Low Gee Tat said players in the hotel industry would like to see a special electricity tariff, reinvestment allowance for big capital items and special allowance for hotels that employed environmental friendly gadgets.

Despite challenging times ahead, a 2008 World Travel & Tourism Council research has projected that Malaysia’s travel and tourism industry would generate RM89bil worth of economic activity and 532,000 jobs this year and contribute 4.8% to the gross domestic product.

Source : STAR
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