INTRODUCTION
Malaysia has long been one of the worlds best kept tourism secrets. It is an ideal tourism
destination in so many different respects as it offers a wide range of diverse attraction to
suit all tastes and most importantly, at relatively affordable prices.
Figure 1: Map of Malaysia
Lying just north of the equator, Malaysia is located at the south of Cambodia and Vietnam
and north of Singapore and Indonesia. More than one thousand islands are part of Malaysia
with some 38 designated as marine parks. Parts of the primeval rainforest are more than
100 million years old with a dazzling selection of birds and wildlife.
Malaysia has superb golden beaches, lush vegetation, mountains and fabulous shopping
allied to some magnificent hotels. This has made the country the fastest growing
destination in South East Asia. The mix of the ancient and the ultra-modern make Malaysia
a fascinating place to visit, while the low cost of living and huge visitor choice makes it an
ideal holiday location.
Malaysia has a tropical climate throughout the year, enjoying warm days and mild
evenings in all seasons. English is widely spoken in Malaysia, although the national
language is Malay. In addition, the country also offers a fascinating cultural mix with
colorful festivals, unique arts and crafts, architecture, food and a rich array of dance forms.
Malaysia is ideally placed to take advantage of its increased interest in the tourism
industry, especially ecotourism segment, as it possesses a wide variety of natural land and
marine habitats, spectacular wildlife, diverse indigenous ethnic groups and cultures,and a
rich history. The World Travel & Tourism Council (WTTC) stated that that the future
prospects for Travel & Tourism industry of Malaysia are good. There is a widespread
recognition of its contribution to the national economy, and the Malaysian Government at
its highest level is fully committed to the long-term development of the industry.
OBJECTIVES
The objective of this assignment is to examine the impacts that tourism could bring to the
country of Malaysia. These impacts are categorized into economical impacts,
environmental impacts, political impacts, and also socio-cultural impacts. Malaysia is
chosen as a research target because Malaysias tourism is at a developing stage and it would
be important to figure out what impacts stem from tourism that the country has to deal
with. Lastly, a number of recommendations as to the future of Malaysia are presented.
ECONOMICAL IMPACTS
Tourism was virtually unknown in Malaysia until the late-1960s. Since then it has
developed into a major sector of the economy. In 1980, Malaysia attracted a fairly modest
2.3 million international tourist arrivals. Ten years later, the total had more than tripled and
the country appeared to be firmly established on the world tourism map.
Tourism industry of Malaysia is one of the most important sectors contributing to the
economy and is the second largest foreign exchange earner after the manufacturing
industry. The country considers tourism as a generation of foreign exchange, increasing
employment, fostering regional/ rural development and diversifying the countrys economic
base.
Travel & Tourism is seen by the government
as one of the keys to promoting a greater understanding of the various cultures and
lifestyles of Malaysias multi-ethnic population.
Employment Generation
The rapid expansion of international tourism has led to significant employment creation.
The employment categories of the Travel and Tourism Economy of Malaysia include:
– Travel companies employment;
– Government agencies employment; and
– Supplier companies employment
The first category (Travel companies employment) represents Travel and Tourism Industry
jobs, while all three categories represent Travel and Tourism Economy jobs.
Figure 2: Malaysia Travel & Tourism Employment
Sources: World Travel & Tourism Council
According to the research of World Travel & Tourism Council (2002), Malaysia Travel and
Tourism Economy employment is estimated at 1,345,000 jobs in 2006, 12.6% of total
employment. By 2016, this should total 1,818,000 jobs, 13.9% of total employment. The
Travel and Tourism Industry jobs account for 4.6% of total employment in 2006 and are
forecast to increase to total 663,000 jobs for 5.1% of the total by 2016. Tourism can
generate jobs directly through hotels, restaurants, nightclubs, taxis and souvenir sales, and
indirectly through the supply of Gross Domestic Product (GDP) needed by tourism-related
businesses.
Contribution to government revenues
Government revenues from the tourism sector can be categorized as direct and indirect
contributions. Direct contributions are generated by taxes on incomes from tourism
employment and tourism businesses, and by direct levies on tourist such as departure taxes
(UNEP Tourism, 2001).
Indirect contributions are those originated from taxes and duties levied on goods and
services supplied to tourists (UNEP Tourism, 2001).
According to the World Travel & Tourism Council (2002), in Malaysia, the largest portion
of this total is from indirect taxes paid in connection with visitor purchases of goods and
services. Next in size is of corporate income taxes paid by Travel and Tourism businesses
and suppliers. Personal taxes are paid by Travel and Tourism generated employment, and
other taxes include oil and stamp taxes. For instance, when all totaled, the Travel &
Tourism Economy was responsible for 10.5% of total taxes paid in 2001. Over the next ten
years, Malaysias Travel & Tourism tax contribution is expected to increase to US$2.7
billion. By 2010, the tourism industry will account for 11.5% of Malaysias tax revenue.
Contribution to Gross Domestic Products (GDP)
The tourism industry is a high growth activity. For Malaysia, the tourism industry is
expected to contribute to 4.6% to Gross Domestic Product in 2006 (US$6.7 billion), rising
in nominal terms to US$16.6 billion (4.8% of total) by 2016 (World Travel & Tourism
Council, 2006). Travel and Tourism is a major exporter, with inbound visitors injecting
