Projected domestic tourism spending puts Malaysia in a better position compared to other countries in the region.
This year saw the travel and tourism industry thrown off course as the pandemic took over the world overnight. Travel restrictions and border closures happened instantaneously to contain the threat of infection, thus bringing the industry to a standstill.
The good news is that recovery is on the way, especially for the ASEAN region as the respective governments are now planning to spur the travel and tourism sector domestically. Economist Wellian Wiranto from OCBC Bank says that the increase in inbound receipts will differ across the ASEAN countries when looking at the varying ratios of inbound and outbound tourism spending.
"Looking at the 2019 data, the relative value of outbound tourism (what ASEAN nationals spent abroad) versus inbound (what foreigners spent here) put some countries in better stead than others," he said in a research note recently.
Compared to four other ASEAN countries, namely the Philippines, Singapore, Indonesia and Thailand, Malaysia is in a better position with US$12.4 billion of outbound spending figure, which exceeds its inbound receipts of US$5.2 billion in 2019. Meanwhile, Thailand’s inbound tourism receipts are at US$60.5 billion and their outbound spending is at US$14.3 billion.
This means, when Malaysians spend the same amount of money that they would normally spend abroad locally, there is a potential inbound spending of at least USD17.6 billion for the country. This is more than 3 times compared to the previous year, giving a huge boost to the country’s economy. Wiranto added, even if the Thais were to spend all of their 2019 travel budget domestically, it would still be three-quarters short compared to Malaysia’s ratio.
Based on the current trends, stimulus vouchers and tax relief will spur domestic travels . This will definitely help the domestic airline industry as Malaysians look to holiday in locations best reached by plane such as Langkawi, Penang, Kuala Terengganu and locations in Sabah and Sarawak. In fact, locals are actually stretching their ringgit to cover more grounds as domestic flight tickets are cheaper compared to international flights. With the personal income tax relief of up to RM1,000 for domestic travel announced by Malaysian Prime Minister Tan Sri Dato’ Muhyiddin Yasin under the PENJANA Short-Term Economy Recovery Plan, more Malaysians will be taking this opportunity to Cuti-Cuti Malaysia, and it is definitely an opportunity that should not be passed up, indeed. So, get your travel luggage ready and start preparing for your next local getaway now!