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Malaysia Tourism Report Q2 2011


Malaysia Tourism Report Q2 2011

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Additional Information
Price $530.00
Meta Description No
Publisher Business Monitor International
Date of Report Apr 15, 2011
Quick Overview
Core Forecasts In 2010, Malaysia welcomed 24,577,196 tourists, just above BMI’s own forecast of 24.56mn for the year. This represented an increase of 3.9% year on year (y-o-y). There was particularly strong growth in arrivals from the sizeable potential markets of India (up 17.1% y-o-y), South Korea (up 16.2%) and China (up 10.9%). Tourist revenues for the year stood at MYR56.5bn (US$17.6bn).
We believe that the growth rate for tourist arrivals did slow slightly over the second half of 2010, with the opening of the new integrated resorts at Sentosa and Marina Bay Sands in neighbouring Singapore doing much to attract tourists away from Malaysia over the latter half of the year. With that in mind, we have made some slight downward revisions to our tourist arrival forecasts for 2011 this quarter. That said, BMI remains bullish about the long-term prospects for Malaysian tourism, which continues to benefit from strong government support and a relatively secure and stable political situation. The country offers a range of tourism options, from travel for meetings, incentives, conferences and exhibitions (MICE) to beach holidays, and the government is committed to supporting an industry that is an important generator of foreign exchange.
Early indications for 2011 are encouraging, with January arrivals data showing a 1.2% annual increase in the number of people visiting Malaysia, at 1,918,751. We are currently forecasting a 5% increase in tourist arrivals for the current year, to reach 25.84mn. Beyond this point, we believe the Malaysian tourism market can continue to show steady growth in the order of 5-6% per annum, with the country currently forecast to be welcoming in excess of 31.7mn tourists by the end of 2015.
Upbeat Outlook For Hotel Industry BMI remains bullish on the long-term growth potential of the Malaysian hotel industry, with several new properties set to open across 2011. At the high-end, InterContinental Hotels Group (IHG) has opened the InterContinental Kuala Lumpur (formerly the Nikko Hotel KL), following two and a half years of refurbishment works. This 473-room five-star property, located within the Jalan Ampang district of KL, offers a range of restaurants alongside gym facilities and a spa. IHG has previously stated its intention to boost its presence in the Asia Pacific region, where it currently operates some 50 hotels.
Also in the luxury segment, Starwood Hotels is to open the 298-room and suite Four Points by Sheraton Sandakan in December 2011. The hotel offers fine dining options alongside a business centre, over 1,500m² of conference space and a spa. In addition, French hotel chain Accor plans to open the 500-room Pullman Kuala Lumpur at some stage later in 2011. Aimed at the business traveller, the property offers extensive meeting and conference facilities alongside three restaurants and a fitness centre. Australia’s StayWell Hospitality Group is also opening the 444-room Park Regis Kuala Lumpur during H111. This property will also boast extensive conference facilities, as well as a gym and swimming pool. BMI believes that the arrival of this significant number of high-end properties should do much to boost average room revenue rates for Malaysia as a whole.
At the budget end of the market, local chain Tune Hotels opened its 101-room Bintulu property in early January 2011, with a second 173-room property soon to follow at Kota Bharu. This brings its total of Malaysian hotels to nine, with the company also operating three overseas properties, two on Bali and one in London. Tune hopes to open some 15 properties within the Greater London area by 2017.
BMI’s current forecasts call for a steady increase in the Malaysian national room supply, to in excess of 200,000 rooms by 2015.
AirAsia profits break the MYR1bn barrier In February 2011, Malaysian low-cost airline AirAsia announced its 2010 results. These showed a 111% annual increase in net profits to MYR1.07bn, the first time the airline has breached the billion-ringgit net profit mark. The airline also posted an 83% annual increase in core operating profit, to MYR828mn. This strong performance was based on higher passenger numbers, with the entire AirAsia group (incorporating Malaysia AirAsia, Thai AirAsia and Indonesia AirAsia) seeing a 13.1% increase in passengers carried over 2010, to 25,680,609. Over the past year, the size of the AirAsia fleet increased from 84 to 90 aircraft.
Looking forward, company CEO Tony Fernandes wants to build on the company’s strong performance in 2010. To that end, the airline is planning to open three new hubs at Kuching, Chiang Mai and Medan and to take delivery of eight brand new Airbus A320 aircraft.
The airline is also looking to raise addition funding via the launch of IPOs in its Thai and Indonesian subsidiaries. Indeed, Indonesia AirAsia (IAA) has confirmed that it still plans to sell a 20% stake later in 2011, despite a poor IPO from fellow Indonesian airline Garuda Indonesia in February. Company CEO Dharmadi says that the airline still plans to raise US$150-200mn via an IPO on the JKSE during the fourth quarter. The proceeds of the IPO will be used to buy new planes and fund growth, according to the company. IAA has a stated aim of increasing its fleet size to 30 (from 20) by 2015. IAA posted a 37% increase in revenues during 2010, to IDR2.76trn, with net profit up by 350%, at IDR474bn. Further information on AirAsia is available in the Company Monitor section of this report.
Table of Contents
Executive Summary ........................................................................................................................................ 5
SWOT Analysis ................................................................................................................................................ 7
Malaysia Tourism SWOT .............................................................................................................................................................................. 7
Malaysia Political SWOT ..................................................................................................................................................................................... 8
Malaysia Economic SWOT ................................................................................................................................................................................... 9
Malaysia Business Environment SWOT .............................................................................................................................................................. 10
Industry Forecast Scenario ........................................................................................................................... 11
Arrivals ............................................................................................................................................................................................................ 11
Table: Arrivals Data, 2007-2015 ........................................................................................................................................................................ 12
Accommodation ............................................................................................................................................................................................... 13
Table: Hotels Data, 2007-2015 (‘000) ................................................................................................................................................................ 13
Expenditure ...................................................................................................................................................................................................... 13
Table: Expenditure Data, 2007-2015 .................................................................................................................................................................. 14
Inbound Tourism .............................................................................................................................................................................................. 14
Table: Tourist Arrivals By Region, 2007-2015 ................................................................................................................................................... 16
Table: Tourist Arrivals By Country, 2007-2015 (‘000) ....................................................................................................................................... 16
Outbound Tourism ........................................................................................................................................................................................... 17
Table: Outbound Tourism Data, 2007-2015 ....................................................................................................................................................... 17
Table: Departures By Destination Country, 2007-2015 (‘000) ............................................................................................................................ 18
Market Overview – Travel .............................................................................................................................. 20
Commercial Airlines ........................................................................................................................................................................................ 20
Global Oil Products Price Outlook ............................................................................................................... 22
Table: Oil Product Price Assumptions, Q410-Q411 (US$/bbl)........................................................................................................................... 22
Table: Oil Product Price Data And Forecasts, 2008-2015 (US$/bbl) ................................................................................................................. 25
Market Overview – Hospitality ...................................................................................................................... 27
Accommodation ............................................................................................................................................................................................... 27
Health Tourism ................................................................................................................................................................................................ 28
H1N1 And H5N1 Update ................................................................................................................................ 30
Business Environment Outlook .................................................................................................................... 32
BMI’s Security Ratings .................................................................................................................................................................................... 33
Table: Asia Pacific Regional Security Ratings .................................................................................................................................................... 33
Table: Asia Pacific State Vulnerability To Terrorism Index ............................................................................................................................... 34
Malaysia’s Security Risk Rating ......................................................................................................................................................................... 34
City Terrorism Ratings .................................................................................................................................................................................... 35
Table: BMI’s Asia City Terrorism Index ............................................................................................................................................................. 36
South East Asia Security Overview .......................................................................................................................................................................... 37
Global Assumptions, Q211........................................................................................................................... 39
Table: Global Assumptions, 2009-2015 .............................................................................................................................................................. 39
Table: Regional Real GDP Growth, 2010-2013 (% change y-o-y) ...................................................................................................................... 40
Table: Selected Exchange Rates, 2010-2013 (average) ...................................................................................................................................... 40
Developed States .............................................................................................................................................................................................. 41
Table: Developed States’ GDP Growth, 2010-2013 (% change y-o-y) ................................................................................................................ 41
Emerging Markets ............................................................................................................................................................................................ 42
Table: Emerging Markets’ GDP Growth, 2010-2013 (% change y-o-y) .............................................................................................................. 43
Consensus Forecasts ........................................................................................................................................................................................ 44
Table: Consensus Forecasts, 2011 And 2012 ..................................................................................................................................................... 44
Company Profiles .......................................................................................................................................... 45
AirAsia ........................................................................................................................................................................................................ 45
Berjaya Hotels & Resorts (BHR) ........................................................................................................................................................................ 47
Malaysia Airlines ........................................................................................................................................................................................ 48
BMI Methodology .......................................................................................................................................... 50
How We Generate Our Industry Forecasts .............................................................................................................................................................. 50
Tourism Industry ......................................................................................................................................................................................... 50
Tourism Ratings – Methodology ......................................................................................................................................................................... 51
Table: Tourism Business Environment Indicators .............................................................................................................................................. 52
Table: Weighting of Components ........................................................................................................................................................................ 53
City Terrorism Ratings .................................................................................................................................................................................... 53
Table: City Terrorism Ratings Methodology....................................................................................................................................................... 55
Sources ............................................................................................................................................................................................................ 55




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