Malaysia has outperformed other South-East Asian countries, with tourist arrivals as of December 2022 recovering to around 92% of December 2019 levels, driven by visitors from Singapore. — Bloomberg
PETALING JAYA: Travellers are once again flocking to South-East Asia with Malaysia leading the region in terms of tourist arrivals.
Standard Chartered (StanChart) reported that across Indonesia, the Philippines, Singapore, Thailand and Vietnam, total tourist arrivals have recovered to about 60% of 2019 levels on average.
Malaysia has outperformed the rest with tourist arrivals as of December 2022 recovering to around 92% of December 2019 levels, driven by visitors from Singapore.
However, with the exclusion of visitors from China and Hong Kong, StanChart pointed out that tourist arrivals from Asean-six (ex- alaysia) had recovered to 75% of 2019 levels.
“The slower recovery in arrivals from China and Hong Kong is due to their more recent border reopening,” the British multinational bank said in a global research report.
It estimated that arrivals from China and Hong Kong are only back to 18.4% of pre-pandemic levels.
While the return of Chinese tourists still has some ways to go, StanChart said Thailand would see the most significant improvement in its travel balance in 2023, followed by Malaysia, from a current account perspective.
It noted that in 2022, Thailand’s travel balance improved to 0.8% of gross domestic product (GDP) from 0.1% in 2021, still far short of the 2017 to 2019 average of 8.6% of GDP.
Malaysia’s travel balance, on the other hand, improved to 0.1% of GDP in 2022 from 0.9% in 2021, but was still below the 2017 to 2019 average of 2.2% of GDP.
“Improving travel balances should continue to support the Thai baht and Malaysian ringgit,” StandChart said.
Separately, Nomura reported that the surge in tourist arrivals to Asean, led by China, is rapidly gaining momentum.
It pointed out that visitors from China to Thailand increased significantly to 269,800 in March from 155,700 in February – a jump to 27.4% of 2019 levels from 14.6% in January.
“This improved total arrivals to 63.9% of 2019 levels from 58.7%, slightly ahead of our forecast of 62.9%,” it said.
In Singapore, total arrivals rose to 65.3% from 63.9% despite non-China visitor arrivals easing to 75.9% from 79.6%.
According to Nomura, there is a bright recovery prospects, particularly for Thailand, which is more reliant on visitors from China than elsewhere in Asean.
“We expect supply-side constraints, such as flight capacity, to ease further starting in Q2, and do not expect the elections in Thailand to be disruptive,” Nomura said.
