This article first appeared in The Edge Malaysia Weekly, on January 30 - February 5, 2017.

THIS year, expect to hear more about the Visit Asean@50 tourism campaign in conjunction with the Association of Southeast Asian Nations marking its five-decade milestone. Asean members are coming together to promote 50 destinations in the region as a way of enticing tourists from all over the world.

Southeast Asia is undeniably home to amazing diversity, from Cambodia’s Angkor Wat and Thailand’s rich cultural heritage to Singapore’s world-class urban attractions and Malaysia’s famed rainforests and beaches.

Launched at the recent Asean Tourism Forum 2017 in Singapore, all 10 Southeast Asian nations pledged to continue working together to facilitate intra-Asean travel and shared knowledge.

Yet, underlying the spirit of collaboration is intense competition between the countries for tourist arrivals and the all-important  travel dollars. Governments the world over know that tourism is a crucial economic sector. It contributes to the economy directly and indirectly and is an important source of foreign exchange.

Tourism also keeps hundreds of thousands of people employed and is a major boost for services, accommodation and construction, transport and air travel. Take Malaysia, whose travel and tourism sector directly contributed RM51.1 billion or 4.4% to gross domestic product in 2015, according to the World Tourism and Travel Council. This is due to economic activities generated by hotels, travel agents, airlines, passenger transport, food and beverage as well as the leisure industry.

The sector’s contribution is projected to rise 7.9% to RM55.2 billion in 2016, WTTC says in its Malaysia report. It adds that domestic travel spend in Malaysia is expected to rise 4% to RM61.7 billion in 2016 whilst visitor exports by international tourists are projected to grow 12.3% to RM68.1 billion.

Malaysia has long promoted tourism. The wildly popular “Malaysia, Truly Asia” slogan has indeed stamped the country’s mark on the minds of many a foreign visitor. The current motto, “Celebrating 1Malaysia Truly Asia”, continues in that vein.

Nevertheless, the global business of travel and tourism has indeed changed significantly in the last decade. Affordable air travel has been a huge catalyst for swelling tourist arrivals. The world’s young and burgeoning middle class is ever-eager to travel and experience other cultures. The internet too has made it exceedingly easy to obtain information about the far-flung corners of the world.

The question is, does Malaysia remain attractive to international visitors when all its neighbours are ramping up efforts to court them? In short, can Malaysia still rely on its pitch of offering the best of Asia in one country?

Where Malaysia stands

At a recent briefing, Tourism Malaysia officials conceded that the tourism landscape is definitely getting more challenging. In his presentation, Tourism Malaysia deputy director-general (advertising and digital) Datuk Seri Abdul Khani Daud shared the good news and the bad news on Malaysia in terms of tourism numbers.

In the industry, international arrivals and tourist spend are the two headline indicators of how well a country is doing. Malaysia is not doing too badly on these fronts. International arrivals grew 4.4% to 22.1 million between January and October 2016 from 21.1 million in the same period in 2015. According to Abdul Khani, tourism receipts for 2016 are expected to total RM82.13 billion, up 18.8% from 2015.

A bright spot in 2016 was that inbound tourists from East Asia and Asean registered growth of 14% and 6.3% respectively. During this period, the top three source markets for international tourists were Singapore (10.957 million, +2.9%); Indonesia (2.45 million, +11.6%) and China (1.755 million, +27%).

The bad news is that there was a decline in arrivals from all other major tourist markets, including West Asia (-6.5%), Europe (-8.2%), the US (-9.6%), Africa (-60%), South Asia (-16.1%), Central Asia (-37%) and Oceania (-22.5%).

Tourism Malaysia blames the drop in visitors from medium and long-haul markets on Malaysia Airlines axing some of its direct flights to European cities like Amsterdam and Paris.

“When Malaysia Airlines withdrew some of its routes to Europe … our link to long-haul markets was significantly reduced. Our immediate reaction was to work closely with other international carriers and in the spirit of Asean, we talked to Singapore Airlines and it agreed to work with us without any hesitance,” Abdul Khani says.

Tourism Malaysia is collaborating with Singapore Airlines on promoting five cities in Malaysia, namely Kuala Lumpur, Penang, Langkawi, Kota Kinabalu and Kuching, to selected markets, namely the UK, Germany, France, Switzerland, Spain, Italy, Russia, the US, Australia, New Zealand, South Africa, India, China and Scandinavia.

Abdul Khani says Tourism Malaysia is also talking to other airlines such as Turkish Airlines and Emirates to increase their flight capacity to Kuala Lumpur.

Although visitors from China and Asean account for a substantial portion of Malaysia’s tourist arrivals, “we cannot lose the long-haul market”, says Abdul Khani, adding that “long-haul visitors stay longer and spend more”.

Malaysia’s tourism sector is quite evenly balanced between domestic travellers (49.5%) and international visitors (50.5%). There are also almost as many leisure travellers (50.1%) as business travellers (49.9%) who come for meetings, incentives, conferences and events.

Tourism Malaysia data shows that the average length of stay of visitors fell to 5.5 nights in 2015 from 6.6 nights and 6.8 nights in the previous two years. Average spend remained stuck somewhat at RM2,600 per person; average per capita expenditure stood at RM2,687.30 in 2015 and at RM2,624.10 in 2014.

Data for the last two months of 2016 is still being compiled but Abdul Khani says Malaysia is on track to hit the projected 26.75 million international arrivals for the year. “We had expected to receive 26.75 million tourists in 2016, up 4% from 2015. But this is still low compared with 27.5 million in 2014. There is a lot more to do,” he concedes.

Although Malaysia’s tourist arrivals and receipts are up year on year, the country is still far from achieving its targets. It did not reach its targeted 30.5 million arrivals last year. When asked about it, tourism ministry officials lament that the target set by the Government Transformation Programme’s National Key Results Areas — for Malaysia to welcome 36 million tourists and record RM168 billion in receipts by 2020 — is rather high.

For this year, Tourism Malaysia has to hit a target of 31.8 million arrivals and RM118 billion in receipts. Is this realistic? “We will have to struggle for it,” Abdul Khani says point-blank.

Competing strategies

At ATF 2017, each of Asean’s 10 members gave an hour-long press briefing on its tourism performance in the past two years and its strategy going forward. This offered a glimpse of the trends in the region and each country’s strategy on how to pull in more tourists and make them stay longer and spend more.

One of the common trends is that Asean and the Far East, namely China, South Korea and Japan, are becoming important sources of tourists — a big shift from a decade ago when the most prized tourists were from Europe and the Middle East.

To be sure, not all Asean countries are equal in terms of tourism infrastructure and know-how. For example, less developed economies like Myanmar, Laos and Cambodia are still working on improving their infrastructure for arrivals and on-ground support services and information. Brunei is updating its tourism products to showcase experiences in the small nation while Singapore and Thailand are ahead of the pack in terms of planning their tourism sectors.

Singapore Tourism Board executive director of communications Oliver Chong outlined the country’s multi-pronged approach to enhancing the tourism and travel sector, which reads more like a strategic business plan than a case study of public policy.

Singapore has committed S$710 million to a tourism development fund to improve its capacity in cruise development, business and leisure events and skills training.

According to Chong, Singapore is also rethinking its digital campaigns to focus on three main points: telling a great Singapore story, targeting the right fans and enhancing delivery. “The story of Singapore should go beyond the destination’s brand. We want to ensure we are focusing on the right fans, namely working millennials, families with young children, active silvers who have retired and have time to travel as well as business travellers.”

Even more impressive is Singapore Tourism Board’s plan to roll out data-driven marketing in a big way to leverage user-generated data as well as official sources of information that may prove useful to travellers. “We intend to build an information and service hub to deepen our understanding of data. We are also looking at word-of-mouth advertising,” said Chong.

The Tourism Authority of Thailand meanwhile said the country has shifted its strategy to promote experiences rather than just attractions and is rebranding itself from being purely a cheap travel destination. “We are highlighting uniquely Thai local experiences. People are looking for real and authentic stories. As they say, it is better to experience something once than to see it a thousand times,” said Tourism Authority of Thailand governor Yuthasak Supasorn.

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