Opportunities and Challenges for Fdi in Tourism Industry in Malaysia

3183 Words Feb 22nd, 2007 13 Pages
Opportunities and Challenges for FDI in Tourism Industry in Malaysia

CONTENTS

1 Introduction 2
2 Overview of the tourism industry in Malaysia 2
2.1 Arrivals and Receipts 2
2.2 Composition of visitor arrivals 4
2.3 Performance of sub-sectors and new investments 5
2.3.1 Hotels and Lodgings 5
2.3.2 Special Tourism Products and Services 6
2.3.3 Related transportation service 6
3 Opportunities for FDI in tourism industry in Malaysia 6
3.1 Healthy tourism business environment 6
3.2 Attractive potential market 8
3.3 Policies and incentives 9
4 Challenges for FDI in tourism industry in Malaysia 10
4.1 Competition between countries and industries 10
4.2 Political risks 11
4.3 Force majeure 11
5 Promote inward FDI 12
6 Conclusion 12
References: 13
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¡°The top three countries of origin for incoming tourists remained unchanged over the review period. The results of an established communication network between its neighboring countries, Indonesia, Singapore and Thailand accounted for over 70% of total tourist arrivals in 2005.¡±(Travel and tourism in Malaysia, pp.24) Besides, the increase of Middle Eastern arrivals during this period was also one of the reasons for the expanding. Table 3 Arrivals by Country of Origin: 2000-2005
'000 people 2000 2001 2002 2003 2004 2005
Australia 236.8 222.3 193.8 144.5 204.1 288.2
Brunei 195.1 309.5 257.0 215.6 453.7 454.2
China 425.2 453.2 557.8 350.6 550.2 294.4
Hong Kong 76.3 144.6 116.4 72.0 80.3 73.7
India 132.1 143.5 183.4 145.2 173.0 224.1
Indonesia 545.1 777.4 769.1 621.7 789.9 972.5
Japan 456.0 397.6 354.6 213.5 301.4 366.3
Singapore 5,420.2 6,951.6 7,547.8 5,922.3 9,520.3 9,799.8
Taiwan 213.0 249.8 209.7 137.4 190.1 157.3
Thailand 940.2 1,018.8 1,116.9 1,152.3 1,518.5 1,915.2
UK 237.8 262.4 239.3 125.6 204.4 250.4
USA 184.1 145.8 127.9 131.1 145.1 168.0
Source: Euromonitor International from trade interviews and official sources (including Tourism Malaysia Profile of Tourist 2004), cited in Travel and Tourism in Malaysia, 2006, pp.25
We can see the downturn in arrivals from western countries (especially from the US) from 2001 terrorist attacks. The economy growth in east and south-east Asia had substantial impact on Malaysian tourism
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