TOURISM INVESTORS PARADISE
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1 TOURISM INVESTORS PARADISE
2 Contents Your Unique Investment Destination Your Unique Investment Destination 1 ECER: A Tourism Haven 2 Boosting Tourism 3 Sustainable Tourism Development 4 Key Tourism Projects in the ECER 6 Prospects Abound for Investment Teluk Bidara 8 Cherating 12 Pantai Penarik 14 Pulau Besar 16 Pekan Royal Heritage Town 18 Investment Opportunities 20 ECERDC The One-Stop Centre for Investors 21 The ECER Incentives Package - Tourism 22 Contact Us 25 MALAYSIA The East Coast Economic Region (ECER), covering the states of Kelantan, Terengganu, Pahang and the district of Mersing in Johor, is now poised to become a dynamic region in South East Asia by offering various opportunities to manufacturers and investors. Strategically located in the east coast of Peninsular Malaysia, the ECER has the potential to become the main gateway for trade and industry within the Asia Pacific region, which commands a total population of about 2 billion people. The vision and mission that will guide the transformation of the ECER into a developed Region by 2020 is defined by three main characteristics distinctive, dynamic and competitive. The distinctiveness of the ECER is portrayed through its natural beauty, abundant resources, unique culture and heritage known throughout the world. To maintain this characteristic, a balanced and sustainable development is emphasised. The dynamism of the ECER reflects the potential for the Region to grow and develop at a faster pace through innovation and a shift in economic orientation, structure, technology and mindset. The competitiveness of the ECER lies in its ability to attract local and foreign direct investments. 1
3 ECER: A Tourism Haven Boosting Tourism Malaysia is the second most popular tourism destination in Asia and the industry is a major source of foreign exchange earnings. Many tourists head for the East Coast states, making tourism a key industry and an important economic cluster for the ECER states. There are six distinct segments of tourism, namely mainland coastal tourism, sustainable island tourism, urban tourism, culture and heritage tourism, cross-border tourism and ecotourism. Over 30 tourism projects have been planned for the Region, providing vast opportunities for investors to reap rewarding returns from their investments. Investors can profit from myriad business opportunities, either participating as co-organisers and co-sponsors or hosting side-events to complement the existing annual high points in the calendar. Of special interest to investors is the fact that numerous tourism projects fall within the ECER Special Economic Zone (ECER SEZ). This is a zone set up by the Malaysian Government for accelerated development, supported by a unique package of incentives over and above those offered to investors in any other part of Malaysia. Investors will find great depth in investment options in prime real estate developments related to tourism, such as shopping malls, hotels and conference centres, local handicraft markets, commercial and residential developments, and large-scale integrated resorts. The tourism initiative in the ECER SEZ aims to transform the area into a vibrant urban centre within the East Coast, equipped with modern comforts while maintaining its age-old charm and cultural identity. The tourist haven of the ECER is thus a paradise for investors too. Infrastructure The Malaysian Government has also embarked on several projects throughout the ECER to enhance its infrastructure. Airports, rail and road links, electricity, water supply, telecommunications including ICT, and sewerage works will be undertaken. Environment In carrying out projects within the ECER, special emphasis will be placed in conserving the environment to ensure sustainability for years to come. This is to maintain the integrity of the natural environment alongside development for the benefit of future generations. Human Capital The ECER Master Plan places special emphasis in nurturing a talented and highly skilled workforce in the Region, to provide an ample source of quality human resources for tourism related businesses to tap into for long-term growth and profitable operations. 2 Investors are discovering the business appeal of tourism in the East Coast, where tremendous opportunities await. 3
4 Sustainable Tourism Development Mainland Coastal Tourism Coastal areas will soon be transformed into integrated tourism destinations. The projects will involve the development of coastal resorts and hotels, a new commercial business area and various other related components. Activities to revitalise the ECER s coastal strips to take advantage of the pristine sea frontage and exclusivity of many ECER beaches have also been undertaken. Sustainable Island Tourism The ECER s island destinations are home to some of the most beautiful islands and coral reefs in Malaysia. Future development strategies will focus on the preservation and protection of islands. Action plans include maintaining the island s carrying capacity; ensuring sustainable developments; improving and upgrading facilities; as well as developing sustainability indicators for monitoring and accreditation purposes. Tourism in Malaysia continues to record higher arrivals amongst foreign tourists, pointing to a growth market that investors can further develop. The ECER is a region with distinctive culture and is considered as the 'cradle of Malay culture' where ancient dramatic arts continue to be performed and perpetuated. The Region is also one of the main sources of Malay handicraft, where traditional artisans continue to produce handwoven textiles, intricate silver and brass vessels and woodcarvings using fine-grained local timber. Tourism Industry Facts & Figures It is expected that the number of tourist arrivals to the ECER states will continue to increase in the future. The ECER welcomed over 1.9 million foreign tourists and 8.3 million domestic tourists in In 2008, amidst a year of global economic challenges, the number of tourists increased even more, to 3.6 million foreign tourists and 12.6 million domestic tourists. These numbers are forecast to grow to 7.4 million foreign tourists and 21.4 million domestic tourists by This growth naturally increases demand for room accommodation, better transport, and other tour-related services. In the year 2020, established hotels and accommodation in the ECER are projected to contribute 15% or 24.5 million of total hotel guests in Malaysia. Various cottage industries manufacturing exclusive products at fair prices make the ECER states one of the main attractions for local tourists. Domestic tourism is seen to remain the highest contributor to the sector in the ECER. Urban Tourism Urban centres of the east coast are being re-energised into vibrant tourism magnets equipped with modern comforts while maintaining their age-old charm and cultural identity. Investors may explore opportunities in developing high-end and budget accommodation, food and beverage outlets with a local or foreign theme, and retail outlets for marketing local handicrafts and delicacies, among others. Cultural and Heritage Tourism Cultural and Heritage Tourism programmes are being developed to enhance the participation of the local population as well as supplement their income. This is a unique and alluring attraction for foreign tourists who want to experience the true heart of a country through the daily lives of its people. Cross-border Tourism The ECER s proximity to Thailand makes it a strategic gateway for tourism and commerce, improving the economic activities that have existed at several towns on the Malaysia-Thailand border in Kelantan and the Indochina region. Border towns will be transformed into bustling hubs for shopping, dining and recreational activities. Ecotourism An unrivalled wealth of biodiversity and natural attractions gives the ECER great potential for development in ecotourism, especially for adventure-based attractions such as rock climbing, white-water rafting and boat rides deep into the heart of the rainforests. The ECER is also home to numerous protected animals and plant species, as well as home to Taman Negara, the nation s primary national park which straddles the borders of Kelantan, Terengganu and Pahang, and the Endau-Rompin Park, another world-famous national park. Hallmark Events These are events that will create a strong multiplier effect and attract an international audience to the ECER, an example being the Monsoon Cup in Terengganu, the Malaysian leg of the prestigious World Match Racing Tour. Other such events are the Taman Negara Eco Challenge in Pahang, the Royal Pahang Billfish International Challenge in Pahang, and the Sultan s Cup Endurance Challenge in Terengganu. 4 5
5 Key Tourism Projects in the ECER THAILAND Kota Bharu KELANTAN PANTAI PENARIK PULAU BESAR Kuala Terengganu TERENGGANU Pantai Penarik Pulau u Besar TELUK BIDARA Kertih Kijal KUALA LUMPUR PAHANG Kuantan CHERATING PEKAN ROYAL HERITAGE TOWN Tanjung Agas Teluk Bidara Pekan Royal Heritage Town LEGEND : Primary Routes (Existing & Proposed) Expressways (Existing & Proposed) MERSING, JOHOR Mersing Airport 6 SINGAPORE 7 Cherating
6 Teluk Bidara Teluk Bidara is located in Dungun, Terengganu. It can be reached by highway from Kuala Lumpur and the west coast, while air travellers can fly in from the Kuala Lumpur International Airport, Subang Airport and the Sepang Low Cost Carrier Terminal. Teluk Bidara is also 20 minutes drive from Kertih Airport and 50 minutes drive from Kuala Terengganu International Airport. Teluk Bidara will be transformed through a mixed development, integrated boutique resort. Its facilities will comprise accommodation, leisure and sports as well as commercial units. The key emphasis is on incorporating the distinctive Terengganu Malay ambience into development at Teluk Bidara creating a unique selling proposition built around tradition, culture, arts and crafts, local cuisine and historical heritage sites. The development at Teluk Bidara is targeted along a 2.8 km stretch of golden beach, on beachfront site of 115 hectares. Here, investors will be able to develop an authentic and traditional Malay Terengganu kampong (village) environment featuring a blend of Terengganu s architecture, culture and customs. The Teluk Bidara Master Plan takes into account the natural environment and will preserve and enhance the heritage of Terengganu. The architecture will incorporate traditional concepts and structures to re-create the Terengganu Malay kampong experience while modern facilities and amenities will satisfy the needs of even the most cosmopolitan travellers. Hotel Apartment Meetings, Incentives, Conventions, Exhibitions (MICE) Hotel Boutique Hotel Heritage Vilage Heritage Vilage Resort Master Plan Meetings, Incentives, Conventions, Exhibitions (MICE) Hotel Activity Hotel Resort Eco Luxury u Hotel Hotel Apartment Eco Luxury Hotel Condotel Retail Village Town Villa Boutique Hotel Town Villa Town Villa Town Villa Heritage Vilage Spa Resort Hotel Town Villa Heritage Vilage Luxury Villa Spa Resort Hotel 8 Teluk T l k Bidara B offers tourism t investors a niche opportunity po u i y the unique u ue Terengganu e en a u Malay M ambience a e that h t promises p o to draw lovers of culture. r. Bidara Wharf 9
7 The Transformation Begins... Artist s impression of the proposed development 120 hectares of prime resort development featuring the distinctive Terengganu Malay ambience. The Teluk Bidara existing site
8 Cherating Chendor The Cherating Master Plan has detailed an integrated development of resorts and world-class facilities for tourists in upgrading the image of this popular coastal getaway. Once known as the location of Club Med, Cherating will now be regarded as a more comprehensive tourism destination with multiple options. As an enclave surrounded by the urbanised areas of Kemaman in the north and Kuantan in the south, Cherating enjoys a location that is in the path of holidaymakers as well as a fabulous seafront facing the South China Sea. Cherating Cherating is envisioned as a Village Resort a green tourist enclave in a rapidly developing region, a beachhead for beaches and the sea, wetlands and mangroves, and forests and the hinterland. All the village charms of Cherating will be preserved, giving tourists the unique experience of participating in a lifestyle that few can call their own. Sg. Ular Cherating is not just about magnificent beaches and the aquamarine South China Sea. Investors can participate in a host of projects aimed at integrated development. Complementing this village ambiance will be a resort enclave of international standard, complete with facilities and amenities that the well-travelled tourist will appreciate. Cherating will thus be a tourism enclave combining both rustic elements and an international resort with a clearly defined urban edge. It will be modern and complete, yet laidback and local a destination that will both intrigue and reward tourists
9 Pantai Penarik This is a stretch of the coastal belt that is particularly picturesque with fishing villages, an idyllic way of life and panoramic views of the Terengganu islands. It offers investors and operators an outstanding opportunity to develop the area into a coastal resort development incorporating nature-based tourism and sun, sea and sand activities. As the area includes stretches of turtle landing sites and the Setiu Wetlands (designated as a State Park), the development emphasis is environmentally attuned to minimise impact on its ecology. Pantai Penarik and the vicinity are noted for distinctive tourist attractions including local weekly bazaars selling local food, arts and craft. Handicraft is an important livelihood, offering tourists a glimpse into the cultural richness of Terengganu, through the making of kites, tops, silverware, songket weaving, woodcarving and boat building. Investors will see numerous opportunities to provide for the needs of tourists - both domestic and foreign in accommodation, food and beverage, wellness, eco activities and marine leisure and sports activities. 14 Idyllic Pantai Penarik exemplifies the rich potential for mainland coastal tourism development its range of attractions has something for everyone. 15
10 Pulau Besar Pulau Besar in Terengganu enjoys the distinct advantage of both river and sea frontage in transforming itself into a tourism magnet for local and foreign tourists. It is close to key roads and airports, which open the way to its golden sandy beaches. Investors are encouraged to take advantage of the river and sea frontage to create a holiday experience unlike any other, by developing facilities and services that are equally different from other tourist destinations on the east coast. Key developments, spread out over a 150-hectare zone, will focus on high-end integrated resorts and spas offering five-star amenities, a medical spa, a boutique resort, private villas, floating riverside villa, and a marina and water sports centre. The medical spa will introduce medical tourism to Terengganu, offering a range of medical and lifestyle services by both medical and spa professionals who will provide comprehensive preventive and wellness care of the highest quality
11 Pekan Royal HeritageTown Evolving from its humble beginnings i in the 13th century, Pekan grew to become an important commercial hub, feeding trade along Peninsular Malaysia s longest river, the Pahang River, right up till the 1960 s. Pekan is a fascinating heritage town primarily known for its status as the seat of the royal house of Pahang. The influence of the royal family can be seen and felt through the magnificent palaces throughout Pekan, which includes the Istana Sultan Abu Bakar, Istana Mangga Tunggal and Istana Kota Beram as well as various royal mausoleums. Other must-see sites that embody the legacy of Pahang include the recently renovated Sultan Abu Bakar Museum and the Watercraft Gallery. The town is also home to Tenun Pahang Diraja, a unique hand-woven silk cloth cottage industry which is one of the key heritage elements to be promoted further. An established Homestay programme also exists where you can stay with a local family to experience and discover the Malaysian way of life in heritage-rich Pekan. Additional accommodation through the form of boutique hotels is also being considered to meet future tourist demand. Further development in Pekan will focus on improving tourist-friendly facilities, amenities and accommodation as well as developing and encouraging sustainable heritage practices through a cultural arts college to ensure that Pekan s unique cultural heritage will live on. 18 Heritage stamps its mark on Pekan, offering investors a unique look at the heritage and culture of the largest state in Peninsular Malaysia. 19
12 Investment Opportunities ECERDC The One-Stop Centre for Investors Tourism is a key revenue generator for the country and has been one of the key thrusts of development in the ECER. Investors will find that the natural resources and landscape of the Region offers them numerous opportunities to invest and enjoy attractive returns on their investment. Within the hospitality industry, investors will be able to participate in integrated resort developments that offer a holistic experience to tourists and business visitors. Due to the varied nature of the landscape and resources of the ECER in tourism, investors will find ample opportunities in the six sub-clusters - mainland coastal tourism, sustainable island tourism, urban tourism, culture and heritage tourism, cross-border tourism and ecotourism, as well as hallmark events. Each of these areas has unique characteristics, adding to a diversity of choices for visitors who are likely to keep exploring the Region over successive vacations. Investors can also explore vast opportunities in tour package development and retail and marketing, as well as the manufacture of handicraft and ethnic inspired gifts as some possible ventures. To accelerate the growth and development of the ECER, a special vehicle has been established through the East Coast Economic Region Development Council (ECERDC). The ECERDC plays a leading role in promoting and stimulating economic and social development as well as private sector investment in the Region. The Chairman of the Council is the Prime Minister of Malaysia with Council members consisting of the highest level of Federal and State leaders. The ECERDC is also made up of a management team of professionals, who provide a range of services that seamlessly facilitate your investments. The ECERDC acts as the one-stop centre to fast track investment applications and approvals as well as provide counseling, advisory services, process fiscal and non-fiscal incentives and various solutions to help make the process of investment easy for investors
13 The ECER Incentives Package - Tourism The ECER Incentives Package - Tourism ECER Incentives Other Incentives Activity/Cluster ECER Incentives Package (To qualify for these incentives, companies must commence operations before 31 December 2015) Activity/Cluster Incentives These incentives are mutually exclusive/to be utilised upon expiry of ECER Incentives Package Tourism activities in designated locations in the ECER Master Plan i) Mainland Coastal Tourism Pantai Sri Tujuh, Kelantan Kuala Besut Tembila, Terengganu Kg. Penarik/Pulau Besar Merang, Terengganu Dungun, Terengganu Kijal, Terengganu Pantai Sepat, Pahang Kuala Pahang, Pahang Cherating, Pahang Mersing, Johor Cross Border Tourism Pengkalan Kubor, Kelantan Rantau Panjang, Kelantan Bukit Bunga, Kelantan Urban & Cultural Heritage Tourism Kota Bharu City Centre, Kelantan Lojing Highlands Urban Centre, Kelantan Kuala Terengganu City Centre, Terengganu Cukai, Terengganu Pekan, Pahang Kuantan, Pahang Sungai Lembing, Pahang ii) Eco-tourism State Parks - Kelantan: Nenggiri & Stong Hills - Terengganu: Tasik Kenyir, Terengganu Hills, Setiu Wetlands - Pahang: Chini Lake Gua Musang Integrated Transport, Rest & Recreational Centre, Kelantan Terengganu Global Marine Turtle Observatory Kuala Gandah Elephant Sanctuary, Pahang iii) Island tourism Group of islands in Mersing Group of islands in Terengganu To qualify as a tourism project, a company must have a minimum investment of RM5 million. Incentives given to owner or owner operator of hotels and resorts, Integrated resorts, Themeparks, Amusement and family entertainment centres, Cultural centres, Conference centres, Exhibition centres, Regional operation of hotel and leisure services Customised incentives based on merit of each case, or Income tax exemption of 100% for 10 years commencing from the year company derives statutory income, or Income tax exemption of 100% for 5 years for eco-tourism commencing from the year company derives statutory income, or Income tax exemption equivalent to 100% of qualifying capital expenditure (Investment tax allowance) for 5 years Stamp duty exemption on land acquired for development Withholding tax exemption on royalty and technical fees for 10 years Application to be submitted to ECERDC Import duty and sales tax exemption on machinery, equipment, and consumables that are not produced locally and used directly in the activity. TOURISM Licensed Tour operators Promotion of - International Conference - Trade Exhibitions (approved by Matrade) in Malaysia Promotional activities overseas by Hotel and Tour Operators Participation in Trade Fairs approved by MITI in Malaysia Cultural performance sponsoring of any arts, cultural or heritage activities approved by the Ministry of Information, Communications and Culture Tax exemption on statutory income derived from: - bringing in more than 500 foreign tourists by group-inclusive tour per year of assessment - domestic tourism packages for more than 1,200 local tourists per year of assessment The incentive is available until year of assessment Tax exemption on income derived from: - bringing in at least 500 foreign participants into the country - bringing in at least 500 foreign visitors per year Double deduction on qualifying expenditure incurred. Double deduction on revenue expenditure incurred, excluding exhibits Single deduction on expenditure incurred for - Sponsoring up to RM500,000 per year for local performances, of which sponsorship of foreign performances shall not exceed RM200,000. Car Rental Operators purchase of National Cars Tour Operators purchase of locally assembled 4WD vehicles Training Investment in buildings used for industrial, technical or vocational training approved by the Minister Cash contribution to non-statutory income oriented vocational training institutions and those established and maintained by a statutory body Royalty payments to non-residents (franchisors) for franchised education programmes approved by the Ministry of Education Research and Development (R&D) Cash contribution to approved research institutes, The above claims to be submitted to the Inland Revenue Board Full exemption on excise duty 50% exemption on excise duty Applications to be submitted to Ministry of Finance Industrial Building Allowance: Initial allowance of 10%, and an annual allowance of 3%. Single deduction Withholding Tax exemption Double deduction on cash contribution Double deduction on payments for services rendered iv) Hallmark Events such as: Taman Negara Eco Challenge, Pahang Royal Pahang International Billfish Challenge, Pahang Monsoon Cup, Terengganu Sultan s Cup Endurance Challenge, Terengganu Single deduction up to a maximum of RM1 million per assessment year for sponsors of event approved by ECERDC Claims to be submitted to Inland Revenue Board Payments made for the use of the services of approved research institutes and companies Research on commercialization of research findings 50% tax exemption on income (honorarium/royalty) received The above claims to be submitted to the Inland Revenue Board 22 23
14 Contact Us If you are an investor planning to establish or expand your business opportunities in the East Coast Economic Region (ECER) we will provide you with professional assistance. We will be the first point-of-contact for all your investment inquiries. Companies planning to start or expand operations in the ECER can obtain information and assistance from the East Coast Economic Region Development Council. We will help you harness the ECER s competitive edge and capabilities to achieve your business objectives. East Coast Economic Region Development Council (ECERDC) Tel : /22 Fax : secretariat@ecerdc.com.my Website : Kuala Lumpur Office Level 69, Tower 2 PETRONAS Twin Towers Kuala Lumpur MALAYSIA Tel : Fax : Kelantan State Office Ground Floor & Mezzanine Lot 137 & 138 Bangunan Sutera Inn Prima Jalan Dusun Muda off Jalan Bayam Kota Bharu, Kelantan, MALAYSIA Tel : Fax : Terengganu State Office Ground Floor & 1st Floor 100 B, Jalan Sultan Zainal Abidin Kuala Terengganu, Terengganu MALAYSIA Tel : Fax : Pahang State Office B8002, Sri Kuantan Square Jalan Teluk Sisek Kuantan, Pahang MALAYSIA Tel : Fax : ECER/V1 East Coast Economic Region Development Council (ECERDC) 2010 All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any means (electronic, mechanical, photocopying, recording or otherwise) without the permission of the copyright owner (ECERDC). 24 Disclaimer: While every reasonable care has been taken in preparing this document, ECERDC cannot be held responsible for any inaccuracies. All information and specifications are current at the time of preparation and are subject to change as may be required. Renderings and illustrations are artist s impressions only and cannot be regarded as representations of fact. 25
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