ASEAN inbound tourism to Malaysia showed a decline of 7% in 2018, driven by a collapse in tourist arrivals from Singapore and Brunei. Both countries have been confronted to a worsening in their political relations with Malaysia since the come back of Dr Mahathir as the country Prime Minister. Is there a link between Malaysia tourism evolution and regional politics?
Last year, Malaysia has continued to see total number of foreign tourist arrivals declining, It was the second year in a row of decline although last year can be considered more by a year of stabilisation than a true drop. Total arrivals topped 25.83 million tourist arrivals in 2018 compared to 25.95 million a year before, a decline of 0.4%. Blame for this negative evolution is to be put on Singapore and Brunei which declined respectively 14.7% and 16.8%. Unfortunately for Malaysia, both countries are among top visitors source. With 10.61 million outbound travellers to Malaysia, Singapore is by far the largest source market as it generates alone 41% of all arrivals. Brunei accounted for 1.38 million arrivals in 2018, representing a share of 5.3% of all international arrivals.
Both countries have seen a worsening of their political relations since the new government under the leadership of PM Mahathir Mohamad took over a year ago. Is it only a coincidence?
A degraded political relationship between Malaysia and Singapore is perceptible since the middle of last year, starting with the cancellation -turned now into a delay over the new high speed train between Kuala Lumpur and Singapore- to issues over air space and maritime space. Both countries have also been unable to solve the issue of overcrowding of border checkpoints across the Strait, especially at the Causeway linking Singapore with Johor Bahru. This probably further dissuade Singaporeans to go visiting its northern neighbour.
Regarding Brunei and Malaysia, the relation has turned more difficult over the Pan-Borneo Highway and over concessions for offshore oil blocks in the South China Sea. Although both countries speak about their cultural and ethnic proximity, the relation has become more tense. During an official visit to Brunei in September last year, Mahathir Mohamad declared that the second phase of the highway project linking Miri to Limbang and Lawas would not go anymore through Brunei after taking into account the cost as well as immigration issues. It is possible that long immigration lines are also having a deterrent effect for tourists.
Last year, total ASEAN arrivals to Malaysia reached 18.11 million, down by 7% over 2017. This translated into 1.3 million less travellers in just one year. Good news was however the return of Indonesian travellers as well as a surge into arrivals from Vietnam and Cambodia. Indonesian tourists to Malaysia jumped by 17.2% to pass again the 3-million mark while Vietnam is on its way to reach the 400,000 travellers’ mark in 2019 after arrivals surged last year by over 50%. It could then take over the Philippines as the fourth largest inbound market to Malaysia.
This is however Cambodia which generated the largest growth in the region. Arrivals jumped by over 114%, passing the 90,000 tourist arrivals. The country is likely to generate in 2019 over 100,000 arrivals for the first time…
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