SINGAPORE: Malaysia collected RM84.1 billion in overall tourism receipts last year, its highest ever while China tourists' expenditure make up RM12.3 billion of the total.
Chinese tourists who have been the key growth driver across southeast Asia for the past decade will continue to support Malaysian tourism growth, said research house Maybank Kim Eng.
In its latest report titled 'Blue Skies, But Keep Your Seatbelts Fastened' presented at the Invest Asia 2019 conference here recently, the research house expects more Chinese to visit Malaysia.
While there were higher tourism receipts collection, data from the Malaysian Tourism Board showed visitor arrivals to Malaysia had eased 3.0 per cent in 2017 before easing another 0.4 per cent in 2018 to 25.8 million.
In delivering the report here today, Maybank Kim Eng analyst Wong Chew Hann said the lack of promotion over the past few months partly contributed to the decline.
“That is something that the government needs to do to step up its efforts.”
In 2018, Singaporeans accounted for 41 per cent of 25.8 million visitor arrivals to Malaysia.
Congestion at land checkpoints due to new biometric system and strengthening of the ringgit against the Singapore dollar has deterred some tourists from crossing over to visit Malaysia.
Wong suggested Malaysia should consider adopting e-visa for visitors from Singapore to counter the land checkpoints issue.
Back in April 2017, one Singapore dollar was exchangeable for RM3.17 but as the ringgit strengthened over the years, it can only fetch RM3.04 today.
Last year, 2.9 million tourists from China visited Malaysia. Recently, China Ambassador to Malaysia Bai Tian had reportedly said this year he expects 3.5 million tourists from China to fly into Malaysia.
As Chinese visitors spend an average of RM4,200 which is a lot more than other visitors, the research house believed more inbound Chinese visitors this year will moderate the adverse impact of fewer Singaporean visitors on Malaysian tourism industry.
Tourists from China are known to frequent casinos. In anticipation of higher tourist arrivals from China, Asian governments are increasingly turning to integrated resorts for tax revenues, including Malaysia.
Maybank Kim Eng gaming analyst Samuel Yin noted that, under Budget 2019, casino licence fees has increased from RM120 million to RM150 million per year while licences for dealer machines has also gone up from RM10,000 to RM50,000 per year.
Malaysia’s Finance Ministry has also raised duties on casinos to 35 per cent from 25 per cent of gross income while duties on gaming machines is hiked to 30 per cent from 20 per cent of gross collection.
Tourism is important for Malaysia's economy because it is a driver of services exports, current account and foreign currency reserves.
The report, revealed the number of hotel rooms in 2018 across Malaysia totaled 308,200. There is a glut of hotel rooms, especially in Kuala Lumpur and Selangor. Airbnb had, in recent years, exacerbated the glut.
Malaysia ranks well globally in terms of cost of living and quality of healthcare. It emerges top in Asean for retirement tourism, boosted by its Malaysia My Second Home (MM2H) programme and retirement villages.
MM2H visa is one of the world's longest duration social visit pass and it is touted to be as good as a permanent residency. With its multiple entry privileges and easy to renew conditions, the 10-year MM2H visa facilitates retirement plans for many wealthy participants.
Many working expatriates have also qualified for MM2H programme making Malaysia their base where they can travel to any of the Asian countries easily for the work and business.
As at August 2017, there were 35,800 participants of the MM2H programme contributing RM13 billion to the economy.
"Many of the participants were from China and based in Johor due to the presence of Chinese developers there. Chinese also like Penang. Western participants, however, prefer Penang and Langkawi," Wong said.