Does Tourism Money Really Go to Tourism Malaysia

Malaysia, marketing, Visit Malaysia Year 2020

An article published in the Malaysian edition of business publication the Edge with Tourism Malaysia Director-General Musa Yusof unveils that Tourism Malaysia gets very little from the various tourist taxes set by the government…

Tourism is the third highest foreign exchange earner for Malaysia after manufacturing and commodities but unfortunately, for now a couple of years, successive Malaysian governments seem to consider tourism more as a tax-revenues machine rather than an activity where it is necessary to invest to keep growing.

For the last five years, tourism into the country has rather been stagnant. For Musa Yusof, who took over the management of the state tourism agency at the end of 2018, the mediocre performance of Malaysia tourism is due to a combination of negative factors such as the crash of two Malaysia Airlines aircraft followed by the restructuration of the airline’s network- and a sharp contraction in subsidies for marketing activities.

According to Musa Yusof, over the last decade, Tourism Malaysia has seen a 70% budget cut in promotion and marketing. Malaysia is today lacking the visibility it used to have for foreign travellers and this is reflected in total arrivals to the country,

According to Yusof, the Visit Malaysia Year 2020 could help turn around the country’s tourism fortune. “With prime minister Tun Dr Mahathir Mohamad endorsing VM2020, we are confident of moving forward, provided there is more allocation for our advertising and promotional activities, ” explained Yusof to the Edge magasine.

“Adequate allocation is crucial. Other regional destinations have been aggressive in their advertising and promotional efforts and we need to have a strong brand presence to compete. Rising media costs and the current currency exchange rate mean that advertising in other countries will be expensive,” he told the publication.

The tourist tax set up during the previous government of Najib Razak, did not seem to have translated into any additional funds for TM. According to Musa Yusof, the collection of Tourism Tax is done by the Customs Department. But no specific sum has been received by Tourism Malaysia so far.

An important element is to boost connectivity to the country. With MAS in financial troubles, all the routes to Europe but London have been closed as well as all flights to North America. This translates into longer travelling times to Malaysia as visitors need now to do one if not two stops en route to the country. ” We have to ensure that accessibility is enhanced through point-to-point connectivity. Convincing international airlines to establish routes to Malaysia is not an easy task, but we will convince them that such a move is feasible and profitable,” he added.

In terms of receipts, Asean markets held the largest share due to the big base of tourist arrivals, but growth in spending came from the East Asian markets — such as China and South Korea — which recorded an increase of 42.1% from RM12.9 billion in 2017 to RM18.4 billion last year.

This year’s target is 28.1 international million tourists and RM92.2 billion in receipts after achieving 25.83 million tourists and RM84.1 billion in receipts last year. This number was roughly the same than in 2013 and was 1.61 million short of the record year 2014 which saw 27.44 million arrivals.  For VM Year 2020, the country hopes to attract 30 million international tourist arrivals.

However, so far, the trade still waits for a proper logo and a specific marketing program as well as themes linked to the VM Year 2020. The new logo was expected to be presented  last week but so far, nothing has been shown to the trade or the consumers. With no logo and no official program and the rise of air taxes for travellers next September, Malaysia will have to work harder to reach its 2020 target of 30 million tourists…