In the midst of unstable market conditions of the world, the tourism sector is seen to be one of the drivers of Malaysia's economic growth. As a small country, the international tourism segment is more important than domestic tourism.
The flow of international tourist expenditure is regarded as a service export in the calculations of the Gross Domestic Product (GDP). Statistics show that the widening service trade deficit has increased from RM11 billion in 2014 to RM19 billion in 2016. Hence, hosting an international sporting event is not only seen to potentially reduce the service trade deficit, but also impact the local economy through foreign tourist spending.
Research in other countries have clearly shown that organising international mega sports events such as the Olympics, the FIFA World Cup and the Formula One (F1) race has a significant impact on the host country. The importance of international mega sports events to the economy is that they have led many countries like the United Kingdom, Germany and Japan to compile Sports Satellite Accounts.
Malaysia has often hosted international mega sports events such as Le Tour de Langkawi, Monsoon Cup and MotoGP. To what extent has the hosting of these international sports events contributed to the GDP and the creation of employment opportunities to the people? The answer to this question calls for specific studies and a need for the compilation of Sports Satellite Accounts. For the record, Malaysia has only currently compiled the Tourism Satellite Accounts and Information And Communication Technology Satellite Accounts.
The compilation of Sports Satellite Accounts is important to monitor the development of the sports industry and to formulate strategies to maximise impact on the overall economy. Furthermore, sports tourism is very closely related to the cultural and health tourism segment.
In a few day’s time, Malaysia will host the 29th SEA Games in Kuala Lumpur. A study on the impact of the 29th SEA Games on the Malaysian economy is being conducted by the Institute for Youth Research Malaysia (IYRES). Hopefully, this study can lead to the preparation of the Sports Satellite Accounts in Malaysia.
Dr. Mohd Yusof Saari
Date of Input: 13/09/2017 | Updated: 13/09/2017 | fakarrudeen