Malaysia to experience influx of Chinese tourists. Here's why

Malaysia is expected to maintain strong momentum of international traffic flow in the second half of 2018, with Chinese tourists forming a "significant portion" of that mix.  According to MIDF Research, the Golden Week in October is expected to encourage outbound travel among the Chinese.

Meanwhile, revenue from retail segments in the airports operated by Malaysia Airports Holdings (MAHB) are also predicted to benefit due to higher footfalls expected in October. As such, MIDF Research remains positive on MAHB's ability to post decent traffic growth this year.

This comes as MAHB's network of airports in areas including Kuala Lumpur, Penang, Kuching and Istanbul registered a 9.5% year-on-year (yoy) passenger growth to 11.2 million in June 2018. International traffic saw a growth of 9.0% to 5.1 million passengers, while domestic had a 10.0% increase in passengers to 6.1 million. According to MAHB, the total 9.5% growth was mainly due to Eid Al-Fitr holiday season, which coincided with the two weeks mid-term school holidays in Malaysia.

On the local front, the 39 airports handled by MAHB recorded a 9.7% yoy growth in passengers to 8.4 million. Meanwhile, ASEAN international traffic registered a growth of 9.4% to 2.2 million passengers, while non-ASEAN destinations grew by 77.2% to 2.1 million passengers. Meanwhile, KLIA Main Terminal and klia2 recorded a yoy growth of 6.7% and 12.5% respectively.

Nonetheless, MAHB said that the anticipated increase in air travel leading to and post elections has been below expectations, adding that the growth for the next six months is expected to be moderate.