Tourism is Malaysia's number two revenue earner, having contributed over $11bn in earnings for 2006. Of the 17.54m visitors who came to Malaysia last year, 185,000 were from the Middle East. While constituting only a small percentage of total volume, Middle East tourists represent Malaysia's fastest-growing and most profitable per capita geographic segment.
As part of Malaysia's celebrations this year to mark 50 years of independence, Tourism Malaysia, the country's tourism promotion arm, has launched the 'Visit Malaysia Year 2007' campaign, an aggressive promotional effort aimed at increasing visitors to the country.
Malaysia is aiming to attract 20.1m visitors for 2007, an ambitious 15% growth over 2006 levels. When it comes to visitors from the Middle East, the targeted growth is far more aggressive, with a goal of 300,000 visitors, a significant rise over the 185,000 visitors who came the previous year. The number of Middle East visitors has risen dramatically since 1999 when they numbered just 15,000.
In addition to the sheer growth in numbers, Arab tourists are particularly attractive to businesses as these visitors spend nearly three times more per day than the average visitor according to Minister of Tourism Adnan Mansor. Middle East visitors are estimated to spend $1842 per family per visit, compared to the average of $497. The average number of room nights per visit is also significantly higher, at 10.5 compared to the usual of 7.6.
Arab tourists, for whom August is the most popular travel month, also help offset seasonality, adding an additional period of traffic to the spring Formula 1 and December European winter-crowd rushes.
As many as 90% of the arrivals from the Middle East come from Gulf Co-operation Council countries. The minister of tourism, as well as Mirza Mohammad Taiyab, director of Tourism Malaysia, were both part of a large delegation at the Arabian Travel Market (ATB) in Dubai, and are now following that up with a 12-day road show to Saudi Arabia, Bahrain, Qatar and Oman.
Razali Mohd Daud, deputy director general of Tourism Malaysia, told OBG, "The Gulf market is important to us because tourists from this area are considered as high-yield tourists. On the average, they stay for over a week and spend three times more than tourists from most parts of the world. Malaysia is known as a family and value-for-money destination. It is a shopping haven and our image as a modern Islamic country is a further advantage in making them feel more at home here."
Mansor, when speaking at the event, cited a number of examples of how Muslim and Arab tourists are well catered to when they visit. There is a district in Kuala Lumpur, known as 'Al-Ain', with Arabic restaurants and clubs. There are also Arabic speaking staff specially placed at Kuala Lumpur International Airport, special immigration lines for Arab tourists with families and there is a wide range of hotels that offer halal food and rooms with Arabic movies and TV.
To capitalise on this growing market, Malaysian Airlines is set to open new routes to the UAE, Kuwait and Bahrain this summer, following UAE-based Etihad Airways' recent increase in direct flight routes to Kuala Lumpur.
The picture is not entirely rosy. A group of Arab travel agents told Mansor of their concerns about dirty beaches and taxi drivers who overcharged their passengers. With the Gulf representing such a profitable emerging market, he said he would act quickly to forward the complaints to the relevant agencies and ministries.
Given the spending power and growth of this niche segment, competition is also fierce, with over 20 national tourism agencies having established permanent offices in the Gulf region.