From the Cameron Highlands north-east of Kuala Lumpur to the ethereal chants and drum playing to be found in the Buddhist caves of Ipoh, Malaysia’s tourist industry is on a roll and drawing visitors in from around the world.

Tourism remains a relatively young business in Malaysia and did not start having an impact on the economy until the 1970s when the country’s Tourism Department, established in 1959, was upgraded and became the Tourism Development Corporation in 1972. But it is now the country’s second most important source of income after manufacturing.

The latest figures from Tourism Malaysia show that, while Singaporeans still made up the bulk of the visitors to the country in 2006, at more than 1.6 million, visitor numbers from elsewhere have soared. More than half a million visitors came from Thailand and Indonesia, and 200,000 from Brunei and China. There are also significant numbers of visitors from Japan (61,133), India (53,870), the UK (51,213), Australia (50,296) and South Korea (41,595).

These numbers should rise further when the region’s Open Sky Policy comes into effect in 2009 and the 10 member countries of the Association of South East Asian Nations (ASEAN) open up and liberalise the region’s air services.

Malaysia has also benefited from the arrival of world-class events that have helped to enhance its image as a tourist destination, such as the Petronas Malaysia F1 Grand Prix, the Langkawi International Maritime and Air Show Exhibition (Lima) and Le Tour de Langkawi.

Strong growth in medical and health tourism has also kept the sector healthy: in 2006, nearly 300,000 health tourists arrived, generating revenues in excess of RM200m ($57.8m). And since the introduction of the nationwide Mega Sale Carnival in 1999, which helped to lift the retail sector, the Malaysian tourism authority has undertaken efforts to position the country as a leading international shopping destination.

High-profile year

The fact that Malaysia is celebrating 50 years of independence and that 2007 is Visit Malaysia Year means that tourist numbers are expected to grow significantly. After a diffident start to the year, visitor numbers surged by almost 10% in February.

The government is aiming to attract more than one million visitors each month and 20.1 million tourists this year with an estimated total spending of RM44.5bn. By May, tourist arrivals had already touched 8.9 million, suggesting that the country may exceed its target.

Whether it reaches its target or not, the travel and tourism industry will continue to be a major contributor to Malaysian gross domestic product, with tourist receipts expected to exceed RM52bn by 2010, according to research from industry research company RNCOS. Analysts expect the tourist boom to continue and inbound tourism receipts to grow at an annual rate of nearly 10% over the coming five years.

More room

New hotels are being built across the country and there has been a steady increase in the number of rooms available. For example, The Four Seasons and Grand Hyatt are scheduled to open in Kuala Lumpur in 2008, with a combined offer of more than 800 rooms.

Despite this upbeat assessment, competition in the region is intense and Malaysia is not without its problems – one being ongoing regional worries about avian flu. However, it should be noted that despite the SARS outbreak in 2003, visitor arrivals recovered sharply the following year, increasing by 48% in 2004.

Tourism Malaysia’s campaign continues apace to portray the country as a peaceful, colourful and multicultural nation that is at ease with itself and that encompasses the whole of Asia’s diverse cultural experience, which continues to pay dividends.