Impact of Tourist Arrival in Economic Growth: Empirical Evidence from Malaysia

Dayang Hummida Abang Abdul Rahmana, A.M Dayang-Affizzah , Salbiah Edman

Department of Economics, Faculty of Economics and Business, Universiti Malaysia Sarawak (UNIMAS)
Email: aardhummida@feb.unimas.mya, amdaffizah@feb.unimas.myb , esalbiah@feb.unimas.myc

ABSTRACT

This study uses secondary data from 1977 until 2011 to determine the relationship between tourist arrivals
and economic growth in Malaysia. Apart from that, the other objective of this research is to investigate the
contribution impact of tourism to economic growth. There are several methods of analysis were used to
analyse the data which are Unit Root test (ADF & PP), Cointegration test (Johensen and Jeselius), normality
test and Granger Causality test. The result shows that there is a positive relationship between tourist arrivals
and economic growth in Malaysia.

Keyword: Economic growth; causality; Tourist arrivals.

INTRODUCTION

Tourism industry which already growing in ancient times found successful becomes generating resources of
high foreign exchange revenue. Furthermore, tourism is one of these important generators of income and
employment creation. Tourism can be defined as process, activity, and result which arose from relationship
and interacting among tourists, tourism suppliers, host governments, host communities, and surrounding
environments which involved in attracting and hosting of visitors (World Tourism Organization [WTO],
2003)1. In addition, tourism is a human activity, which encompasses human behaviour, resource utilization,
and interaction with other people, economy and environments (Adrian Bull, 1995). Apart from that, people
come from this country also could categorise as tourist. Visitors were divided into two, firstly tourist that
means temporary visitors to a country at least 24 hours, for the purposes of leisure or business and; secondly
excursionists that means temporary visitors staying in a country less than 24 hours, for the same purposes,
but excluding transit passengers (Adrian Bull, 1995). At the same time, tourist have are various perspective
in different countries. Mohammad, Elsadig & Abdur (2011) also mentions that Malaysia can become one of
the leading tourist destinations competing with other popular destinations of the global economy. In
addition, tourism sector success many countries worldwide, including Malaysia, is often measured in dollars
and cents or specifically by the number of international tourist arrivals and the income they bring
(Baharuddin, Ahmad, Jamil & Kong, 2000)
According to Khaled (2009), tourism term is a kind of universal remedy for some of the macroeconomic
problems, as an engine for social transformation and to produce a good image on the global platform driver
in an era give incentive that is too generous to industry. As we know, tourism represents one of the most
dynamic economic sectors in the world (Edgardo, 2005; Imran, Muhammad & Fareed, 2010; Jamieson,
2000). However, tourism also can give the positive and negative impact to our economic growth. Tourism is
also main source and the biggest contribution in economic Malaysia. Nowadays, tourism industries
The World Tourism Organization is the United Nations agency responsible for the promotion of responsible, sustainable and
universally accessible tourism. This organization also promotes tourism as a driver of economic growth, inclusive
development and environmental sustainability and offers leadership and support to the sector in advancing knowledge and
tourism policies worldwide.
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becoming increasingly vital namely are catalyst in Malaysian economic development and contribute much to
income and countrys growth. Furthermore, it can become aspiring a foreign centre for tourism. Malaysia is
an interesting holiday destination offering something for everyone to enjoy their holiday. According to WTO
(2005), Malaysia was ranked as the thirteen worlds top tourist destinations while within ASEAN region
Malaysia was the leading country in receiving inbound tourists by controlling about 32.7 percent of total
arrivals in 2004 (WTO, 2006). The countrys main gateway is the Kuala Lumpur International Airport
(KLIA). Besides, it also offers low cost flight which is Air Asia in Low Cost Carrier Terminal (LCCT).
Other major international airports are Langkawi, Penang, Johor Bahru, Kota Kinabalu and Kuching
(Malaysia, 2012). According to Syahida (2003), in the tourism industry, the tourism attractions are key
factors in making a destination attractive and exciting. However, they are a few reasons for tourist to come
the country. In generally, factors that attracting the tourists is culture, demography, political environment,
and economic growth. Firstly, endowed with a diversity of culture, Malaysia offers a truly Asian
experience. Malaysia is a melting and amalgamation of people from various races (Tourism Malaysia;
National and Marine Parks, 2010). Moreover, factor that attracting the economic growth in Malaysia is the
size and value of a national economy is normally expressed as the total value of all goods and services
produced by the economy during a specified time period, such as one year (Adrian Bull, 1995). This industry
perceived as contributed on generating foreign exchange earnings, employment and income. Norsiah Kadir
(2008) found that the rising economic importance of the industry had been fuelled by the large and growing
number of international tourists. However, the tourists that come to our country can give some effect and
challenges face the Malaysia tourism industry
Table 1: Total Number of Tourist Arrival and GDP in Malaysia (2007-2011)
Year
Tourist Arrival
GDP Constant Price
2007
20.9 million
506,341
2008
22.0 million
530,683
2009
23.6 million
522,001
2010
24.6 million
559,554
2011
24.7 million
590,353
Source: Department of Statistics Malaysia
Table 1 shows GDP and tourist arrival from 2007 to 2011. In year 2007, the number of tourist arrival is 20.9
million and the total GDP in Malaysia is 506, 341. Whereas in year 2010, the number of tourist arrival
slightly increase to 22.0 million and GDP also rapid dramatic sharp to 530,683. After that in year 2010, the
total tourist arrivals only encounter rose dramatic a litter that of 24.6 million and the total GDP is 559,554.
Lastly, in year 2011 the total tourist arrival is 24.7 million and the total GDP is 590,353. This prove that the
higher tourist arrival, that will become dramatic sharp GDP and the largest contributor to this country.
Tourism sector is the largest generated into economic growth in Malaysia. This is the main reason for the
government support and promotes tourism throughout the world. Furthermore, this sector can give a
positive impact upon economic growth and development in Malaysia. According to Edgardo Sica (2005),
today tourism represents one of the most dynamic economic sectors in the world and the study aims to verify
if tourism represents a determinant of growth in such countries. Different from other perspective, tourism
should generate employment and income, lead to a positive tourism balance of payments, stimulate the
supplying sectors of tourism, and lead to a generally increased level of economic activity in the country and
will give an impact on the frequently used quantitative measure of the economic development, gross
domestic product (GDP) (Edgardo, 2005; Stanislay and Craig, 2006; Nanthakumar, 2007). In fact, tourism
industry is largest contributed to our economic country. Another key point, Syahida (2003) also agreed that
tourism can create needed jobs for residence, generate needed funds to improve the lives of local people and
increase business for local merchants in small coastal town seeking economic security. In other word,
tourism industry not only benefits to economic growth in our country, but it also benefited to the people of
this country. Sara and Elias (2008) also belief that there a significant relationship between economic growth
and tourism. In addition national economy to benefit from tourism depends on the availability of investment
to develop the necessary infrastructure, and capacity to supply the services that tourists require. Furthermore,
when a country becomes more recognized, thus it facilitates to attract foreign travels (Business travels),
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which leads to an increase in the foreign reserve of the country. Therefore, indirectly it will increase our
FDI.
On the contrary, Samina (2010) found that tourism led to a growth of household incomes and government
revenue directly and indirectly by means of multiplier effects, improving balance of payments and provoking
tourism-promoted government policies. Indirectly, household will be active participating contribution to
development of the nation. In addition, it can improved policy environment for sustainable tourism
development has major implication for macroeconomic goals and national social development objectives,
especially those related to poverty reduction (United Nations, 2007). They also mention that at the same
time, are new opportunities for increasing the efficiency and effectiveness of tourisms contribution
involving the government, the private sector and other stakeholders.
As noted in the previous section, tourism is one of the largest and fastest growing industries in the global
economy and currently the third most important industry for Malaysia in term of foreign exchange earning
(MIER, 2008). Balaguer and Jorda (2002) explored the role of tourism for the economic growth of Spain
using cointegration and causality testing. Adamos and Sofronis (2009) have acknowledged that diminishing
returns will eventually set in, putting a limit until level that the tourism sector can contribute on countries
welfare. Tourism is not only one creator of GDP, but has an important contribution to value added [Minciu,
2000, 25]. This industry can also have an impact on natural resources in the various tourist destinations, on
everyday life of these locations and also on the individuals from those areas, whether rural or urban.
Therefore, this study try to fill this gap by investigate the between Gross Domestic Product (GDP) and
tourist arrivals in Malaysia. The problem is to understand the difficult of effectiveness of virtual tour
technology for the market of tourist places in our country in particularly with grows of tourism industry.
Other than that, it is difficult to our country to attract the international tourist especially from western
country. Furthermore, is that our place and product in our country will satisfy the tourist desire. The visitor
can also virtually browse through a souvenir or gift shop thats on internet before deciding to buy anything
they wish (Prasana, 2002). This study gives the opportunity for country to identify the real source for
economic growth in this country. Different from other research, this study merely using two variables only;
the fist was total tourist arrival and secondly is GDP in Malaysia. In other words, this study would like to
investigates the contribution of tourism in related to the Malaysian economic growth whereby provide the
relevant recommendation of government policy to strengthen the economic performance in Malaysia.
LITERATURE REVIEW

A development in tourism industry is really emphasized therefore the interesting places in Malaysia can
attract more tourists arrival to come to Malaysia. Alfartas (2009) investigated that to have a development
increasing in this sector a demand from the people must be created and that cannot be happen if they only
have a tourists attractive place. Apart of that, government and private sector must participation through a
long term plan. In contrast, Sica (2005) said that they are other factors contributed to the rapid development
of tourism in the South-East regions, for example are technological improvements, new marketing
promotional strategies and elimination of political barriers. Moreover, in order to, tourism sector become an
alternative driving force to achieve economic development, the part of gains from tourism should be
allocated for improving the living conditions of weak population.
According to the Salleh (n.d), explored the tourism development can be attracting foreign direct investment
(FDI) inflow that having significant impact in generating economy. In addition, according to Kweka et al.
(2003) also have the same opinion. They mention that in Tanzania, the contribution of tourism sector has
attracted investment and policy initiatives to supports its development. The certain investment can give
benefit both communities and reserves. Apart of that, they also mention that tourism sector can generate
indirect tax revenue. Tourism sector will also give in directly or indirectly contribution to one country.
Households indirectly will be earning income more by working in tourism sector or supporting industries.
Indirectly, tourism industry will increase economic growth and further increase this countrys name. In
3

addition, according to Brida et al. (2008), investigated the tourism sector have relationship among elasticity
of tourism expenditure (TourExp), real exchange rate (RER) and in long-run economic growth (GDP).
Policy implications will be accessible this by enhance performance of the economic growth and increase
their administrative management performance. In contrast, Malik et al. (2010) examined that there is longrun relationship between the number of tourists, GDP growth rate and current account deficit. It will increase
Pakistan balance of payments accounts by cutting down current account deficit and the GDP will be
improves.
According to the Zortuk (2009), identify that tourism industry in Turkey have emerged as a great empire
with annual foreign exchange that high and job opportunities directly and indirect. In fact to, it is not only
increase foreign exchange income, yet it had spurred growth of the tourism industry and additional it also
triggered overall economic growth. As a matter of fact, Tohamy and Swinscoe (2000) having the same
opinion on the matter above. Moreover based on export revenue, tourism has become the worlds largest
source of income and item that is important in balance of payment to most of the country. The direct effects
of tourist expenditure on business are tax potential contribution that estimates high from total of tax revenue.
That research also indicated that direct impact foreign tourist expenditure about four times the one percent
contribution from hotel and restaurant to GDP in national account.
Furthermore, Mazumder et al. (2011), think that tourism industry not only creates considerable high
multiplier effects but also stepped up the inter-sectoral linkages in the economy. Therefore, multiplier effect
that is direct, indirect, and induced is reason which helps in expand tourism contribution to economic. In
additional, the capacity to generate ripple effect by tourism makes one important medium of foreign
currency injection which had been significant attention for developing countries economic development. The
developing country has been gradually depending on income streams from tourism while traditional
economic sector has been less potential in contributing to GDP country. In contrast, Evan et al. (2008) has
different perspective. They found that tourism industry is as one of the income earners that are attracts great
interest from policy aspect for economic growth that continued in this country.

METHODOLOGY
This section explains more about the method to be used in this research. The Methods and techniques of this
study will involve several aspects such as the conceptual framework, research design and hypotheses of the
study. Furthermore, this study was focuses on the period of the studies data, the variables that used, and how
data is analyzed and what the data analysis carried out from these studies. In this section, the time series data
always includes four standard procedures which are Unit root test (ADF, PP), Normality test, Co-integration
test (Johansen and Jesulius, JJ 1990) and Granger Causality.
Data
This study use the time series annual data from year 1977 until year 2011 which is was used the yearly data.
The data that used are GDP and total number of tourist arrival to Malaysia. The data had been found from
Department of Statistic Malaysia.
Unit Root test
Unit root test is test to defined stationary or non-stationary in the result. The unit roots test is a more formal
test, which is required to check the stationary properties of the variables. Stationary is refers to the state
where the underlying stochastic process that generates a data series is invariant with respect to time. It is
important for estimation because with apply least squares regression on non-stationary variables can give
misleading parameter estimates of the relationship between variables. Meanwhile, with checking for
stationary, it will be explain what kind of processes we need to estimate for our models. If the characteristics
of the stochastic process change over the time, we can say that the process is the non-stationary. Nonstationary time series data is necessarily contain the permanent components. The mean and variance of a
4

non-stationary time series depend on time, which can cause a series has no long- run mean. The ADF test
is one-sided because the alternative hypothesis is that < 0 (or p).
Phillip and Perron (1988) propose an alternative (nonparametric) method of controlling for serial correlation
when testing for a unit root. The PP method estimates the non-Augmented DF test equation, and modifies
the t-ratio of coefficient so that serial correlation does not affect the asymptotic distribution of the test
statistic. The PP test is differing for the ADF in the treatment of serial correlation. The information based
method does not apply to the PP test. The lag selection is not that important in PP test if compare with ADF
test.
Cointegration test
Cointegration test is the test to find this result is long run relationship or short run relationship among the
endogenous and exogenous variable. Advantages of Johansen and Jeselius, JJ is the Johansen multivariate
procedure poses several advantages over the residual-based Engle-Granger two-step approach in testing for a
long-run relationship among economic variable. Phillips (1991) has documented the desiberility of this
technique in term of symmetry, un-biasedness and efficiency. Furthermore, it is well known that the
Johansen procedure does not suffer from normalization problem and is robust to departures from normality
Cheung and Lai, (1993), Gonzalo (1994). To reject the null hypothesis, the trace statistic and maximum
eigenvalue statistic must greater than critical value. When the two or more variables in a system are found to
be co-integrated, it said to have a long run relationship. But if does not co-integrated they are short run
relationships.
Normality test
Normality tests are used to determine whether a data set is well-modeled by a normal distribution or not, to
compute likely an underlying random variable is to be normally distributed. The distribution of sum of a
large number of independent and identically distributed random variables tends to a normal distribution as
the number of such variables increases indefinitely. If the number of variables is not very large or they are
not strictly independent, their sum may still be normally distributed. The normal distribution is a
comparatively simple distribution involving only two parameters (mean and variance).

Granger Causality Test

Granger Causality Tests based on Vector Error Correction Model (VECM) is deployed when cointegration is
detected. The purpose is to avoid problem of misspecification (Granger, 1988). The existence of a
cointegrated relationship in the long run indicates that the residuals from the cointegration equation can be
used as ECT as below.
LnGDPt=0 i + =1

3,i LnTA t-i + 1ECT t-1 + 1t

LnTAt = 0 + =1

2,iLnGDP t-i + 2ECT t-1 + 2t

EMPIRICAL RESULT AND DISCUSSION

5

(1)

(2)

As mentioned in the previous chapter, the data that have been used in this study was gained from year 2001
until 2010 for both dependent and independent variable. This chapter will be presented the empirical result
using the statistical analysis of Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) Unit Root Test,
Co-integration Test, Normality Test and Granger Causality Test. The result will be presented in the table
form followed by the explanation for each tests. The empirical result will be presented in table from and
followed by the analysis of the empirical result.
Table 2: Result for Unit Root test

intercept

ADF test
level
Trend & intercept

2.372(1)
-3.446(14)

-0.923(0)
2.629(0)

variable

LGDP
LTOURIST

1st difference
intercept
Trend & intercept

-6.834(0)***
-2.261(0)

-8.083(0)***
-3.244(0)*

Notes: Asterisks (*), (**), (***) indicate the rejection of the null hypothesis of non-stationary at 10%, 5% and 1% and ( ) denote
the lag length.

Table 2 represents the result of ADF unit root test in probability value (p-value). Null hypothesis can only be
rejected if p-value is smaller than 0.1. In the levels intercept, ADF test results provide evidence that only
Tourist arrival and GDP not significant in that case the first different are proceed. At the first differences,
GDP are stationary at 1 percent significant and Tourist arrival only have one significant at first differences,
trend and intercept at the level of 10 percent during the period of the annually from 1977 2011.
Furthermore, the null hypothesis is rejected at the first difference because the variable of GDP and Tourist
arrival was found to be stationary at the first different and statistical significant.

Table 3: Result for Unit Root test

PP test
intercept

Trend & intercept

1st difference
intercept

2.824(5)
5.489(3)***

-0.421(3)**
2.629(0)

-6.781(3)***
-2.161(3)

variable

LGDP
LTOURIST

level

Trend & intercept

-8.787(3)**
-3.087(3)**

Notes: Asterisks (*), (**), (***) indicate the rejection of the null hypothesis of non-stationary at 10% 5% and 1% and ( ) denote
the lag length.

Table 3 represents the result of PP unit root test in probability value (p-value). At the level intercept GDP
significance. In other words, all the probability is less than 0.01. In contrast, in first differences, only GDP
are stationary at 1 percent significance. Tourist arrival only significant at level intercept, at 1 percent
significance. Moreover, the null hypothesis is rejected at the first difference because the variable of GDP
was found to be stationary at the first different and statistical significant. The ADF and PP test shows that,
most the variables are stationary and the test can be proceed to cointegration test

Cointegration test
6

The purpose of cointegration test is to test the existence of long run relationship among the endogenous and
exogenous variable, namely the GDP of Malaysia and Tourist who come to Malaysia. It is also known as
multivariate analysis. To reject the null hypothesis, the trace statistic and maximum eigenvalue statistic must
greater than critical value.
Table 4: Co-Integration Test
Alternative

Null

k=2 r=5
Test statistic

Trace
95% (C.V)

Test statistic

-Max
95% (C.V)

14.76445**
14.07
19.72945**
15.41
4.965006**
3.76
4.965006**
3.76
Notes: Asterisks (**) denote statistically significant at 5 percent level. The k is the lag length and r is the co-integrating
vector(s).

r=0
r<= 1

r=1
r=2

Table 4 indicate that the trace test and maximum eigenvalue exist at single and double cointegration vector
and the variables are moving towards equilibrium. The table shows that both Max and Trace tests suggest
that there is a cointegrating relationship because they are significant. The trace test shows that the rejecting
of the null hypothesis of r=0 which is 14.76445 is greater than critical value. The null hypothesis of r 1 is
also rejected due to the greater than critical value. The maximum eigenvalue test indicates that the rejection
of the null hypothesis is only occurs at r=0 of maximum eigenvalue test of 19.72945 and r 1, maximum
eigenvalue test of 4.965006 is greater than critical value. Based on the result, it can be interpreted that
cointegrating test has are relationship between the GDP and tourist arrival.

Normality test
Normality tests are used to determine whether a data set is well-modeled by a normal distribution or not, to
compute likely an underlying random variable is to be normally distributed.

Figure 1: Normality test

9
Series Residuals
Sample 1977 2011
Observations 35

8
7
6

Mean
Median
Maximum
Minimum
Std. Dev.
Skewness
Kurtosis

5
4
3
2

Jarque-Bera 0.884566
Probability
0.642568

1
0
-15000 -10000

1.35E-12
-476.0103
9592.812
-13874.48
4978.152
-0.379907
3.171002

-5000

5000

10000

The figure 1 indicates that most observations are highly concentrated on the left side of the distribution.
Furthermore, based on figure above, the distribution found more to negative side. This proved to its
7

skewness and kurtosis is -0.379907 and 3.171002. To summarize, the Jarque-Bera test return 0.884566,
which reject the null hypothesis of normality because p-value is less than 0.0001.
Granger causality test
Table 5: Result for Granger Causality Test
Dependent variable

GDP

TOURIST

ECT1__________
ECT
t-ratio

GDP
TOURIST

0.124

0.355
-

-0.383*
-325.715

-2.537
-1.685

Notes: is the first difference operator. Asterisk (*) indicates statically significant at 5% level

Table 5 indicates the causality relationship between Tourist arrival and economic growth in Malaysia based
on VECM. The t-ratio on the coefficient of the lagged error-correction term (ECT) represents the statistical
significance on the long run causal effect, while VECM was constructed to obtain the short run elasticity.
The coefficient of ECTs in GDP equation is 0.383, indicating that about 38 percent of the adjustment is
completed in an annually. This means that Malaysia needs approximately 2 and year to reach long run
equilibrium from the estimed result. In other words, only the Tourist arriva VECM has long run causality. In
addition, the result also shows that the direction of granger causality is shown a one-way causality. For short
run causality, based on the results obtained that both GDP and Tourist arrival statistically insignificant at the
5 per cent level.
Figure 2: Long Run Causality Direction
GDP

Tourist
Notes: GDP

Tourist implies one-way causality or unidirectional

Furthermore, the result indicates that economic growth does not Granger cause tourist arrivals, but tourist
arrivals Granger causes economic growth. Based on the figure 2, this suggests unidirectional causality
running from economic growth to tourist arrivals.
CONCLUSION
As a conclusion, this research is carried out to investigate the impact of tourism will effect economic growth
in Malaysia. Apart from that, this study also has others objectives which aim to identify the contribution
impact of tourism in related to economic growth and to provide recommendation and policy for government
in related to tourism growth. Besides, the results for ADF test suggest that GDP are stationary at the first
difference with one percent of significant level while tourist arrival are stationary at the first difference with
ten percent of significant level. Corollary, null hypothesis rejected at the first different because the variable
was found to be stationary. Moreover, PP test suggest that only GDP are stationary at the first difference
with one percent of significant level. In addition, the cointegration test has been run by using Johansen and
Juselius test (1990) and it shows that both trace and maximum eigenvalue test statistics rejected the null
hypothesis at five percent significant level which implies that there is cointegration between GDP and tourist
arrival.
In the vector error correction model, the result suggest the there is no causality between the GDP and tourist
arrival in the short run because the result shows that bigger than 5 percent level of significant. This mean the
8

tourist arrival cannot be explained properly by the economic condition. However, the granger causality test
has explained there is long run relationship between the two variables. These results show that there is
unidirectional between economic growth and tourist arrival in the long run. The result of analysis which
made in chapter four found tourists arrival have a positive relationship with GDP Malaysia. This can be
proved when all tests have been made to show that the existence of positive relationship between dependent
variable namely economic growth and independent variables are tourists arrival. In other words, an increase
in tourist arrivals also led to increase in GDP Malaysia.
From the results that are obtained, it was found that the objective have been achieve where found that
tourism has a positive impact on economic growth in Malaysia. In other words, the increase in tourist
arrivals will cause an increase in economic growth in Malaysia generally. Diversity of tourism products that
introduced like ecotourism, health tourism, film tourism, tourism homestay, edutourism and tourism aqua is
also one of the increase of tourists factor to Malaysia. Apart from that, a high gross national income, lower
inflation, population rates that high and short haul destinations influencing tourists to visit Malaysia.
In addition, the tourism industry is very sensitive to international recession crisis non- economic like war,
natural disasters such as haze and plague. The global economic recession has greatly slowed also related to
tourist development in this region. Besides that, the World Tourism Organization estimates has estimated
that tourism accounts will reach up to 10% of global gross domestic product, making it the worlds largest
industry. Besides that, tourism also contributes to the reduction of poverty and that for many of the least
developed countries, and in many rural areas, tourism is one of the viable strategies that also contributed to
the development of the country. In 2020, Malaysia targets 36 billion tourist will arrive, and bringing up to
RM168 billion in the revenue for the country. As a conclusion, the analysis shows, then, that a long-run
stable relationship between economic growth and tourism expansion exists. The strong impact of tourist
activity, according to the magnitude of the estimated parameter would reveal the existence of important
long-run multiplier effects.
In developing a master plan countries may wish to consider incorporating the recommendations presented
below as well as those contained in Commission resolution on Implementation of the Plan of Action for
Sustainable Tourism Development in Asia and the Pacific. Malaysia as a truly Asia, is a country that has an
attractiveness of its own. Moreover, by looking at the rise in the tourism sector, it is opportunity to further
boost the tourism industry in Malaysia by diversifying tourism activity that more innovative. Government
should consider increasing their efforts to assess the economic impact of tourism from boiling. The
formulation of national tourism development policy must be done will as not hindered by lack of data on the
scope and extent of the economic contribution of tourism and its impact. Promotional activities should be
directed towards to raise awareness and encourage visitors to visit tourist attractions in Malaysia.
Concentration should be given to improvements to attractions and present markets and developing tourist
infrastructure. Government also should consider establishing in order to create inter-ministerial committees
that include representatives from the tourism industry in order to coordinate and monitor that
implementation of the plan. In addition, the government must make improvements in procedures for the
issuance of visas, border formalities and customs regulation to ease international travel.
In other words, to attract tourists arrival, a strategy involves consumer marketing and commercial need to
be developed to promote the tourists on tourism product offering unique and different than other countries.
Although, has a strong tourism product, it is possible can be the main motivate a tourist to travel our country.
Thus, to attract the international market to come to Malaysia, tour package can be proposed together with
other tourism package. For example, the welfare tour package and tourism homestay were consolidated, that
can attract more tourists attention. It is likely to be a added value for product tourist from other countries
and with the image enhancement it will contribute to extension of tourist visit to one country. In order to
increase the demand on the international market, the unique destinations may need to be explored with
include and introduce natural products that are invaluable national treasures such as rafflesia flower that can
only found in Sarawak. Environmental and socio-cultural should be considered and integrated into national
policies and plans for tourism development. Collaborative approach between the public sector, private sector
and stakeholders can internalize some of the external travel cost thereby preserving the cultural heritage and
9

protect our environment. Government and private sector must work together to ensure efficiency in realizing
Vision 2020 to achieve developed nation and thus introduced the name at the international level. Besides
that, countries should consider a undertaking surveys to assess the needs and demands of the workforce to
the level skills and training of current and future training requirements in the tourism sector, and develop a
national tourism training plan. Bilateral, multi-lateral and sub-regional cooperation in tourism development
should be further strengthened. All the above recommendations are intended to improve and add value to the
existence to being tourist attractions. However, it may be increased in accordance with the needs and
demands of tourists which is in line with current trends, tastes and quality of life improvement.

Acknowledgements
Financial support from Universiti Malaysia Sarawak through SGS-03(S100)/868/2012(13) is gratefully
acknowledged. All remaining flaws are the responsibilities of the authors.

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