VISIT Malaysia 2020 (VM2020) is the boost the national economy needs this year in the face of sluggish domestic private investment and a challenging global environment, said a think-tank.

The Socio-Economic Research Centre (SERC) said the tourism campaign can provide more jobs and increase business profits, provided the government and its private sector allies carry it out effectively.

This is because industry players feel that the country has not fully harnessed its tourism potential, while neighbours like Thailand and Indonesia have surged ahead, it said.

Businesses related to tourism, such as retail, food and beverage, accommodation and transport, together make up more than a quarter, or 27.8%, of the national economic output or gross domestic product.

In 2018, one out of 10 jobs in the Malaysian economy was tourism-related, said SERC executive director Lee Heng Guie.

According to Finance Ministry calculations, a 10% increase in tourist arrivals will lead to a 0.033% rise in GDP and 0.007% increase in jobs, said SERC’s 2020 economic outlook.

“(The) Visit Malaysia (campaign) is a low-hanging fruit that can boost the services sector,” Lee told The Malaysian Insight.

“If we can get the numbers and spending effect, tourism will surely create economic spin-offs and multiplier effects for the domestic economy.”

The government has targeted 30 million in tourist arrivals and hopes to collect about RM100 billion in tourist receipts this year.

The last Visit Malaysia push in 2014 earned the country RM72 billion from 27 million visitors.

Since then, said SERC, tourist arrivals and revenue have stagnated due to increasing competition from Malaysia’s regional neighbours.

In 2017, there were 25.9 million arrivals and RM82.2 billion in revenue, while 2018 saw 25.8 million visitors and RM84.1 billion in revenue.

Last year, between January and September, arrivals reached 20.1 million, while revenue was RM66.1 billion.

An Associated Chinese Chambers and Commerce and Industry survey revealed that 78.2% of those in the sector feel that “Malaysia has not harnessed its full potential in tourism”.

About 81% of respondents said “Malaysia’s tourism is lagging behind its neighbours”.

The Malaysian Insight’s own interviews with industry players found that some doubt whether the government can reach its target, given the late start of promotions for VM2020.

To take full advantage of the campaign, Putrajaya must ramp up marketing and branding to attract “quality-spending” visitors from the Middle East and China, said Lee.

“The country must improve its cleanliness and also enhance tourist safety, and publicise this,” he said, pointing to Malaysia’s low scores in world rankings on public security and cleanliness.

Among his other proposals are:

– Front-line service counters at airports must be adequately staffed with guides who can speak several languages;

– The revenue threshold for budget hotels to charge the sales and services tax should be increased to RM1.5 million from the current RM500,000, so that they can be more competitive;

– Local councils must be more flexible with cut-off periods for night events in tourist areas; and,

– Increase the number of tour guides who speak foreign languages. – January 15, 2020.