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Langkawi Blueprint

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					                                V. Economic impact and funding
                                The results of the Blueprint will double Langkawi’s tourism and
                                tourism-related gross national income (GNI) from RM0.8 bn
                                in 2010 to RM1.9 bn in 2015. This doubling is driven by an
                                expected increase in tourism receipts and additional agri- and
                                aquaculture revenues from the farming and fisheries initiative
                                (categorised as ‘tourism-related’ income). There is also likely to
                                be further potential upside to the GNI as our forecast currently
                                excludes income that may be generated from real estate sales
                                as well as the multiplier effect (as income from tourism flows into
                                other related sectors to generate more income).




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MSG027_SquareA4_inlay.indd 66                                                                   2011-12-01 17:44
                                V. Economic impact and funding
                                The results of the Blueprint will double Langkawi’s tourism and tourism-related gross national income
                                (GNI) from RM0.8 bn in 2010 to RM1.9 bn in 2015. This doubling is driven by an expected increase in
                                tourism receipts and additional agri- and aquaculture revenues from the farming and fisheries initiative
                                (categorised as ‘tourism-related’ income). There is also likely to be further potential upside to the GNI
                                as our forecast currently excludes income that may be generated from real estate sales as well as the
                                multiplier effect (as income from tourism flows into other related sectors to generate more income).

                                Tourism receipts are expected to double from                  opportunity. For example, local entrepreneurs will
                                RM1.9 bn in 2010 to RM3.8 bn in 2015                          benefit from healthier market competition given
                                                                                              strict enforcement against illegal operators. Similarly,
                                By launching tailored marketing campaigns, enhancing          students who were previously deterred from entering
                                flight connectivity and developing more products               the tourism industry due to a lack of training
                                targeted at the luxury market, we expect to shift the         opportunities and uncertain work prospects will now
                                mix of tourists to higher spending tourists. In addition,     be able to pursue a good education at the Tourism
                                the Blueprint will also create a greater variety of quality   Academy followed by a guaranteed job placement
                                products, thereby encouraging visitors to spend more          with a participating industry member.
                                on attractions and stay longer. The increase in these
                                key levers (visitor arrivals, average spend per day and       Cumulative funds of over RM5 bn are required,
                                average length of stay) will drive Langkawi’s tourism         of which only 8% is expected to be publicly
                                receipts to grow at 14% p.a. from RM1.9 bn in 2010 to         funded
                                RM3.8 bn in 2015.
                                                                                              We estimate to spend over RM5 bn from 2011 to
                                The Blueprint will create an incremental 4,200                2015 to implement the Blueprint initiatives. Of this
                                jobs by 2015                                                  amount, ~84% will go towards capital expenditure
                                                                                              for the product initiatives, for instance, the building
                                The Blueprint will be a growth catalyst for Langkawi’s        of hotels, commercial zones and new attractions like
                                tourism industry. More accommodation and commercial           the Interpretive Centres.
                                zones are expected to be developed, leading to
                                generation of new jobs at hotels and retail shops.            We expect the private sector to participate actively in
                                The fragrant rice programme and integrated cage fish           these initiatives and contribute 92% of funding. The
                                farming initiative will create more jobs for farmers and      remaining 8% that is funded by the public sector will
                                fishermen as well. As a result, the Blueprint is expected      primarily go towards the acquisition of land for the
                                to create an incremental 4,200 jobs, of which ~55%            development of the accommodation and commercial
                                will require vocational or certificate qualifications and       zones and the enhancement of baseline infrastructure
                                ~45% will earn over RM2,000 per month.                        (e.g., agriculture dams). In the 2012 Budget tabled
                                                                                              on October 2011, RM420 mn was allocated towards
                                Critically, the Blueprint will improve the livelihoods of     the implementation of the initiatives within this
                                the local community by addressing current career              Blueprint.
                                frustrations and opening up a new landscape of

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MSG027_SquareA4_inlay.indd 68                                                                                                                            2011-12-01 17:44

				
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