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					                         Putting Your Tourism Resources to Work   3-4 May


      Chairman, Tourism Malaysia

     IV Astana Economic Forum

     Astana, Republic of Kazakhstan

              3 May 2011

                                                  Putting Your Tourism Resources to Work   3-4 May


During the last few years, the tourism industry worldwide had experienced turbulent
times, from mounting concerns about terrorism, ash from volcanic eruption, rising
fuel prices, and lower tourism spending as a result of the economic downturn in
major tourism source countries. Despite all these, international tourism continues to
be resilient and tourism arrivals in 2010 grew to 935 million, up 7% over 2009.
Increasingly governments in many countries are no longer associating tourism as a
subsidiary activity associated with leisure but have given it centre stage as an
economic and export activity of the country. A dynamic tourism industry raises
national income, provides employment, brings in foreign exchange (in the manner
that the export of manufacturing goods does), and improves a country’s balance of

For many developing countries, tourism can become an important driver of growth
and prosperity as well as a key role in poverty alleviation. The positive aspect of
tourism is that a country’s own attributes and endowments, such as natural beauty,
native culture and festivals, handicrafts, activities and events, can be turned into
tourist products without the need of committing hundreds of millions of dollars as is
the case of developing the manufacturing sector. Even the rural setting and village
life could be turned into homestay as a way of enriching the cultural experience for
tourists, while providing income enhancement and employment opportunities for
rural households.


Malaysia decided to go seriously on tourism promotion following the Asian Financial
Crisis 1997/98 that resulted in sharp economic contraction, rising bankruptcies and
the depreciating Ringgit. The wide fluctuation of the value of the Ringgit as a result of

                                                  Putting Your Tourism Resources to Work   3-4 May

currency speculation brought uncertainty to international trading and seriously
dampened Malaysia’s export sector. In tackling the financial crisis, Malaysia adopted
a comprehensive National Economic Recovery Plan in 1998, which among others,
sought to stabilise the Ringgit, address the problems of the financial sector, and
adopt policy measures to turn around 13 economic sectors and bring about speedy
economic recovery. One of the major decisions by the Malaysian Government at that
time was to give more resources for tourism promotion because it was identified as
one of the sectors which could quickly boost foreign exchange, activate the economy
through its links with the other activities, and pull the economy out of recession.

As a Blue Ocean strategy, the Malaysian Government saw the potential of tourism
and decided to use the sector to generate economic activities during a time when
the other economic sectors were in recession. In the following year 1999, the
country launched the “Malaysia Truly Asia” campaign, which we continue to use
today. This was a new destination branding and marketing campaign that won many
international awards and accolades. The extra resources allocated by the
Government helped to strengthen staffing capacity at the Malaysia Tourism
Promotion Board and enabled the country to undertake an international promotional
campaign in a big way.

Tourist arrivals stood at 5.5 million in 1998 during the crisis. As a result of a
successful campaign, tourist arrivals took off and grew rapidly, adding 5 million
tourists every three or four years during the last 12 years. By 2010, Malaysia’s tourist
arrivals became four times larger at 24.6 million and the country has now emerged
as the 9th most visited country in the world. Tourism generates RM1billion every
week (or USD1 billion every three weeks), making Malaysia’s tourism industry the
second largest foreign exchange earner. In other words, tourism is only second to
Malaysia’s large manufacturing sector in terms of export earnings.

                                                   Putting Your Tourism Resources to Work   3-4 May


One powerful lesson from Malaysia’s tourism success story is the strong
commitment of the Government towards the tourism industry. Tourism is recognized
as an important economic sector as well as an export industry up to the top levels of
government. In 2004, the Ministry of Tourism was established as a standalone
establishment, separating it from the Ministry of Culture, Arts and Heritage. In
addition, the government established appropriate mechanisms to develop tourism
activities, set aside public sector allocation to develop tourism products, facilities and
infrastructure, and allocate sufficient resources for tourism promotion. The tourism
ministry is usually the ministry with the smallest budget. For a country’s tourism
industry to become vibrant, it is necessary to align the policies and actions of other
government agencies so that they become pro-tourism. This is because the policy
actions on civil aviation, public transportation, immigration and customs, local
authorities, retail activities police etc., which are beyond the Ministry of Tourism’s
area of responsibility, will directly impact on tourism development and tourist
perception of the country. But how does a junior ministry influences the policy
actions of the other senior and larger ministries? In order to bring about inter-
ministerial coordination, a Cabinet Committee on Tourism headed by the Deputy
Prime Minister was established in 2005 for policy making and coordination on
matters affecting the tourism industry. This institutional arrangement was done as a
prelude to the very successful Visit Malaysia Year campaign that was conducted in

In addition, to ensure the dynamism of tourism, some other measures that were
implemented include the setting up of a crisis management committee to respond
quickly to crises, improving service delivery, investing in human resource
development through training and capacity building, working together with industry
players, and fostering closer public-private partnerships. These measures are aimed

                                                 Putting Your Tourism Resources to Work   3-4 May

at boosting tourist arrivals by allaying safety and health concerns as well as
portraying Malaysia as value for money and top-of-mind destination.

During the last 12 years we undertook many marketing campaigns. However, one
campaign that stands out is “Visit Malaysia Year 2007” which was organized to
celebrate Malaysia’s 50th year of Nationhood. Through this campaign alone,
Malaysia’s tourist arrivals jumped by 3.5 million and tourist earnings increased by
RM10 billion (USD3 billion) in one year. The campaign not only involved stimulating
demand through effective marketing and promotion to the target markets, but also
improving the supply side such as cleaning and sprucing up cities, improving tourism
products, and coming up with an attractive calendar of events. The training of front
liners and the close collaboration between the government and private sector is
essential for the success of this campaign. The power of mounting a successful Visit
Malaysia Year campaign is that it helps to realign the perspectives and actions of
various players in the country so that they become more tourism friendly, thereby
increasing our overall effectiveness in attracting tourists over the medium and long


In times of adversity such as the economic downturn, there was an even greater
need to be creative in product development. For that matter, there is an urgent need
to continue increasing the tourist attractions for market diversification. The focus is
on product innovation and creativity. There is a need to create products that are
interactive, fun, exciting and that are well received by the tourists. Malaysia lies at
the crossroads of Asia and showcases the rich integration of cultures and values from
the East and West. The country also is endowed with rich and well-diversified
tourism potentials that can be easily tapped.

                                                 Putting Your Tourism Resources to Work   3-4 May

   Citrawarna –Colours of Malaysia

Malaysia is a multi ethnic society comprising large segments of Malays, Chinese and
Indians as well as other ethnic communities. The Citrawarna or Colours of Malaysia
Festival is held every year in a street parade to showcase the pomp, splendour and
pageantry of cultural extravaganza of songs, dances and cuisines of the multicultural
society. This is the time of the year where the cultures and arts of the various races
take centre stage. The unique composition of our culture, which is the amalgamation
of Asian civilizations comprising the Malay, Chinese, Indian and other ethnic groups,
has provided us the competitive advantage to develop exciting and creative tourism
products andpackages. This event attracts over 100,000 audience as well as many
foreign media and journalists.

   Fabulous Food 1Malaysia

The different ethnic communities with their different cuisines are turned into a
tourism product. The three-month long food festival, “Fabulous Food 1Malaysia”
promotes the unique cuisines from Malaysia, the ASEAN countries as well as the rest
of the world. This event which runs from October to December will feature three
different segments. They are:

    Malaysian International Gourmet Festival (1-30 October)-features fine-dining
      cuisines from hotels and restaurants.

    ASEAN Food Trail (1-30 November) featuring the rich and diverse cuisines
      from the ASEAN region.

    Street Hawker Food (1-30 December) - the promotion of street hawker
      cuisines and shopping mall food courts.

                                                  Putting Your Tourism Resources to Work   3-4 May

   Geographical Location and Weather

Geographically, Malaysia is strategically located just north of the equator and is well-
positioned to tap the various markets in Asia, Europe and Oceania. Given its location,
it can tap the summer and winter markets from both the northern and southern
hemisphere two times a year. Its summer temperature is constant throughout the
year and ranges from 23 degree Celsius to 33 degree Celsius. Malaysia is also blessed
for being situated out of the belt for volcanoes, earthquakes and hurricanes.
Currently, it is well-positioned to tap the fastest economic growing short and
medium-haul markets, including China, India and the Southeast Asia.

Peninsular Malaysia, which ends in the southern-most tip of mainland Asia,
experiences the Northeast monsoon and the Southwest monsoon. The Northeast
monsoon, which occurs from November to March, brings strong winds and heavy
rain to the east coast of the peninsula. This season is usually associated with the low
tourist season and low hotel occupancy. However, through some innovative thinking,
the disadvantage of rain and strong waves and wind became an event feature. The
Malaysian event organisers turned the monsoon weather into a tourism event. By
organising the Monsoon Cup, which is an international yacht race held during the
North-east monsoon season, the strong wind and heavy rain are part of the
demanding conditions that international yachtsmen would have to compete under.
The Monsoon Cup is recognised internationally during the America Cup and brings in
70,000 tourists and the wide coverage of many international TVs and media to
Terengganu, where the event is held.

   Rainforest World Music Festival

Malaysia is covered by the tropical rainforests which are millions of years old and
among the most biodiverse on the planet. According to reports, there are more than
700 species of trees in a 10 hectare plot in the Malaysian rainforests. This number of

                                                 Putting Your Tourism Resources to Work   3-4 May

species is equal to the total number of trees in Canada and the United States

In order to build up the mystery of the Borneo rainforest, the event organisers in
Sarawak stage the Rainforest World Music Festival at the Cultural village in the midst
of the forest, bringing together on the same stage renowned world musicians from
all continents as well as indigenous musicians from the interiors of the mythical
island of Borneo. In the afternoon, the festival is filled with informative workshops,
ethno-musical lectures, jamming sessions and mini concerts, followed by evening
performances on the main stage. This event has now gone into the 12th year and
proven to be a hit with the audience, who come from near and far. There are many
enthusiastic fans worldwide that come specially for the event. It has also received
free publicity by various TV stations that make and screen documentaries on the
event. The number of audience has grown to 24,000 over the 3-day event.

   Homestay Programme

The Homestay programme is part of rural tourism aimed at boosting the
participation of rural communities in the tourism sector. It helps to differentiate
Malaysia from its competitors by highlighting its rich and unique natural
environment. The advantages of this programme are many. Tourism activities and
their beneficiaries need not be confined to urban areas and tourist resorts. Through
the Homestay programme, tourism activities could be brought to the rural areas and
benefit directly the rural inhabitants by generating income and improving the social
economic circumstances of people in the rural areas.

Homestay and rural tourism can create a new brand of tourism experience for
visitors by featuring the attractive scenic and lush tropical landscape, offering
activities for the tourists to participate in and enjoy, and providing accommodation in
rural houses where the tourists can interact with the rural community. In Malaysia,

                                                  Putting Your Tourism Resources to Work   3-4 May

the homestay programme is a cultural experience where tourists stay with selected
families and interact and experience the daily life of these families as well as
experiencing Malaysian culture. For the tourists, homestay provides a unique
experience of rural lifestyle and culture, while the rural community can share the
benefits of the tourism industry and boost household income through rural tourism
entrepreneurship and job creation.

There are some challenges to be faced particularly in terms of the big gap between
the tourism product quality, standards, and services found in the cities and resorts of
Malaysia compared to what is found in the villages. There is also the challenge of
changing the attitude and work practice in rural areas where people are primarily
engaged in agriculture production to that of the provision of tourist service.
Improvements will have to be made to accommodation, visitor facilities, rubbish
clearance, customer care delivery and maintenance of products and facilities. The
cost of undertaking these improvements are, however, quite minimal since they
involve activities that could be organised and performed at the village level.

The activities undertaken at the community level cover livestyle and cultural
activities as well as rural economic activities. The community organises tradition
dances, songs and food, traditional games, wedding ceremonies and excursion to
nearby tourism sites. The tourists are also brought to experience rural economic
activities such as rubber tapping, fishing, going to the paddy fields and fruit farms,
and visiting rural micro industrial projects. In 2009, the Malaysian homestay
programme received 161,600 tourists and RM10.9 million (USD3.4 million) revenue.
For the rural community, this programme provides a useful supplement to household
income, particularly for the elderly. Up to October 2010, the Ministry of Tourism
registered 138 homestay participating villages, 2,987 homestay operators and
homes, providing 4,042 rooms.

                                                  Putting Your Tourism Resources to Work   3-4 May


In recent years, Malaysia tourism has introduced many new and novel programmes
as a way of attracting high value tourists and diversifying the tourist market.

  1 Malaysia International Shoe Festival

The 1 Malaysia International Shoe Festival was first held in 2010 as part of the
Malaysian Grand Prix Sale in conjunction with the Formula 1 Grand Prix season. Dato
Jimmy Choo, who is an international shoe icon and whose shoes are featured in the
popular TV series, Sex and the City, is Malaysia’s tourism ambassador. Malaysia is a
billion dollar producer of ladies shoes for exports. The 1 Malaysia International Shoe
Festival is a creative way of bringing together the strengths of a country, that is, an
international shoe icon who is Malaysian and the vibrant shoe industry, and turn that
into a tourism product. The shoe festival not only generates interest among shoe
connoisseurs, buyers and sellers from across the globe to Malaysia, but also attracts
high-end tourists who seek exclusiveness and high-value services.

   The Malaysia International Night Floral Parade 2011

Malaysia’s tropical climate as well as hill flower growing industry produces a
profusion of flowers for domestic consumption as well as export. The Malaysian
International Night Floral Parade this year will feature the colourful floats and lights
that represent the vibrant floral species and designs as well as the multicultural
facade of the region. Each participating country will be represented by a boat
decorated with colourful lights in the shape of floral and fauna, as well as nature and
cultural icons representing the identity of each country.

                                                 Putting Your Tourism Resources to Work   3-4 May

   1 Malaysia Contemporary Arts Tourism Festival

The Festival traces the development of modern Malaysia through contemporary art,
featuring more than 80 Malaysian artists. There will be Seminars and talks on
Malaysian contemporary arts by internationally-acclaimed speakers such as Mika
Kuraya from Japan and Russell Storer from Australia. There are also Art auctions by
Henry Butcher Art Auctioneers. Besides creating a tourist attraction for art lovers and
collectors, the Contemporary Art Festival has also benefited the local artists whose
works are better appreciated and command better value.


Malaysia’s tourism sector will continue to be in the forefront of the country’s
economic development, to drive the economy, provide income and job
opportunities, and brand the country as an attractive place to visit, live, and invest.
Realizing the advantage the country has in tourism and its strong position in global
tourism, the Government has set its sights further for the tourism industry. As the
target for the year 2020, Malaysia aims to receive 36 million tourist arrivals and
RM168 billion (USD56 billion) tourist receipts. This would mean the industry will
grow by 3 times and tourism will contribute RM3 billion (USD1 billion) receipts every
week to the country in 2020. This ambition will be achieved by implementing key
tourism initiatives under the Economic Transformation Programme.

The five thematic areas for the tourism initiatives are Affordable Luxury, Nature
Adventure, Family Fun, Events and Entertainment, and Business Tourism. Under
Affordable Luxury, Malaysia’s attraction as a duty free shopping destination will be
enhanced as a means of increasing tourist spending. The country is blessed with an
abundance of biodiversity. To turn this natural gift to an advantage, the tourism
programme is to tap Malaysia’s full potential for ecotourism that is well managed
according to the principles of long-term sustainability. In addition, the ecotourism

                                                 Putting Your Tourism Resources to Work   3-4 May

sites would be developed and better managed in terms of their carrying capacity and
packages sold to tourists would reflect the true value of the precious natural
resource and heritage.

Malaysia is also taking steps to capture a bigger share of the family market segment
that is rapidly growing among the middle-class populations of India, China and the
Middle East by increasing the availability of world-class family bonding activities and
tourism products, such as integrated resorts and cruise tourism. Another area of
focus is hosting more international events and promoting a vibrant nightlife in
Malaysia necessary to attract tourists and provide a boost to the tourism industry.
Finally, business tourism would be developed by having a more targeted approach in
bidding for international conferences and seminars to be held in Malaysia. Business
tourism is an attractive segment because delegates to business events spend up to
three times more than non-business tourists and up to 60 percent of delegates
eventually return as regular tourists.


In conclusion, countries should look at their natural attributes and competitive
factors and be creative in developing them as tourism products so as to tap this
rapidly growing industry that is one of the world’s greatest sources of income,
employment, and export earnings. Regardless of the level of economic development,
a country can always seek for ways to create its own niche in the tourism industry.
While highly developed cities may be an attraction for some tourists, there are
tourist segments that look for unspoilt wilderness or tranquillity that are associated
with less developed environments. Ethnic tourism activities create direct benefits to
local ethnic communities in rural areas. It further encourages people to conserve
their typical life, traditions and related natural or biological resources which are
unique and has much more value in their life.

                                                  Putting Your Tourism Resources to Work   3-4 May

I believe that in order to put tourism resources to work and for tourism to thrive in
any country, certain issues should also be addressed accordingly. We need to
strategise and manage tourism growth in a systematic and orderly manner consistent
with the scope of priorities and plans. Tourism marketing, infrastructure and new
product development are required in a bid to improve and grow the industry and
increase tourist earnings.

-Hence, when a country puts to work its tourism resources, it will be able to reap the
benefits of a growing and vibrant tourism industry. A well-sustained tourism industry
will not only create jobs, but will also provide many with hope, career and a future. It
will also bring people together, foster mutual tolerance and respect, and support
environmental sustainability.


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