According to statistics on Tourism Malaysia’s website, foreign tourist arrivals in January had fallen from 2,447,397 last year to 2,291,603 this year, a drop of 6.4 per cent. ― File pic

PETALING JAYA, Oct 21 — Malaysia is experiencing its first slump in foreign tourist arrivals in decades.

Malaysian Association of Tour and Travel Agents president Datuk Hamzah Rahmat said this was due to the global economic slowdown and tourists having less money to spend regardless of the exchange rate.

“Domestically, we are able to break even but as far as the foreign market is concerned, I don’t recall when we have had it this bad,” he said.

Hamzah said the haze had a minimal impact on tourist arrivals but said street protests including Bersih 4 and the Red Shirt rally had a negative impact on the industry.

“The haze is not something new. The tourists know when to avoid the country but the protests definitely made them worried. It created the impression of instability in the country,” he said, going by the startling tourist arrival figures in the first quarter of the year.

Hamzah suggested the government take firm steps in Budget 2016, which will be tabled in Parliament on Friday, to give the industry a boost including extending the tax waiver to tourist agencies for handling tourists that is set to end this year.

“If an agency is able to secure 700 foreign tourists or 1,000 locals, they will get a tax waiver. We are asking for an extension of this policy,” he said.

Hamzah said the government should consider lowering the threshold or do away with it altogether as an incentive for bringing in foreign tourists.

He also said domestic flights should be zero-rated, especially for those flying between East and West Malaysia to encourage domestic and foreign tourists to travel.

“A tourist visiting Kuala Lumpur might consider an extension of his trip to Kuching if it was more affordable.”

However, Tourism and Culture Minister Datuk Seri Mohamed Nazri Aziz did not seem worried although he said there had been a decline of 9.4 per cent tourist arrivals in the first half of this year. Some 12.56 million tourists visited the country from January to June, compared to 13.9 million in the first half of last year.

“Among the reasons for the decline were the knock-on effect of the economic downturn, the East Coast flooding disaster, and the incidents involving Malaysia Airlines and AirAsia,” he said in a reply during question time in Parliament yesterday.

He dismissed claims that the recent Bersih 4.0 and Red Shirt rallies had scared away tourists and negatively affected the industry.

Instead, he said tourists from Western countries were used to street demonstrations.

“For them, this is normal and there is nothing to fear. In fact, I want to thank the foreign media outlets for broadcasting the demonstrations every hour because they show that we are a democratic nation.

“In fact, we have probably saved billions of ringgit in free advertising to show we are a healthy democracy!” he said, eliciting laughter from other MPs.

“Don’t always think these things have a negative effect on the country.”

According to statistics on Tourism Malaysia’s website, foreign tourist arrivals in January had fallen from 2,447,397 last year to 2,291,603 this year, a drop of 6.4 per cent.

The drop continued in February with 1,949,016 tourist arrivals compared to February last year (2,118,540), an eight per cent drop.

Arrivals in March were 2,242,007 compared with 2,525,496 in March last year, an 11.2 per cent drop.

The figures released by the ministry were last updated on April 22.

Among the worst-hit were arrivals from China, which fell from 520,466 from January to March last year to 379,265 (-28.5 per cent) in the same period this year. Tourists from Singapore also dropped from 3,548,301 last year to 3,241,651 this year, a slump of 8.6 per cent. Arrivals from Japan fell from 149,859 to 125,339, dropping 16.4 per cent.

Sectors which saw growth in the first quarter of this year were arrivals from Brunei (3.3 per cent), India (2.5 per cent) and South Korea (11.2 per cent).

In 2013, Malaysia recorded 25.72 million foreign tourist arrivals. Countries recording the highest tourist growth in the first quarter were Singapore (an increase of 18.3 per cent), China (26.4 per cent), and Indonesia (21.1 percent).

The only major country which saw a decline was Thailand which went from 309,666 in 2012 to 272,564, a drop of 11 per cent.