TOURISM activities in the country have finally resumed after nearly two years of closure but operators are struggling to restart due to lack of funds, industry players said.

They are now urging the government to provide RM5 billion to help operators get back on their feet as many have run out of reserves after not earning any income for a prolonged period of time.

Malaysian Association of Tour and Travel Agents (Matta) honorary secretary-general Nigel Wong hoped that Putrajaya will allocate RM5 billion for the tourism sector to help them restart and remain competitive with neighbouring countries.

“Matta has requested that a special fund, independent of the banking system, be made available to tourism players who currently have trouble accessing financial assistance from traditional financial institutions,” he told The Malaysian Insight.

“The fund should have fewer restrictions and more favourable and flexible repayment terms.”

RM5 billion is also a small amount compared to how much the tourism sector contributes towards the country’s gross domestic product, he added.

Wong said the funds will not only facilitate the reopening of domestic tourism but also help them prepare for the arrival of international tourists.

Other forms of assistance

Putrajaya allocated a total of RM1 billion to support small and medium enterprises (SMEs) in the tourism sector, under the Penjana economic package.

The maximum financing allocated for each SME was RM300,000 while micro-enterprises received funding of up to RM75,000 at an interest rate not exceeding 3.5% for a financing period of seven years.

This, however, was introduced in August last year.

Malaysian Chinese Tourism Association national president Albert Tan said since then, tourism operators have not had any income for more than a year.

He hoped the government could introduce a similar package and give tourism agencies a RM300,000 loan to restart.

“For larger agencies, an allocation of RM500,000 to RM1 million can be considered. After the reopening of the industry, we can reemploy our original staff, pay for rent and more.”

After a year without income, a RM300,000 loan can at least help operators cover reopening costs, he said.

He said a six-month buffer period should also be given to allow operators to repay the loan once they start making profits.

And because only domestic tourism is currently allowed, Tan said players who depend on international tourists should be given this buffer before repaying the loan as they will not be earning as much as they used to.

Malaysian Inbound Tourism Council president Uzaidi Udanis said most tour agencies need start-up capital with smaller ones needing at least RM20,000.

He said it is difficult for tourism operators to obtain loans from banks as the sector is considered high-risk because of the pandemic. Hence, the government needs to provide direct assistance.

“We hope the government can set up a tourism bank, just like the Agro Bank, which provides loans for farmers. A dedicated bank that understands the burden of the industry can help fast-track loan approvals.”

Uzaidi said car rental companies, for example, have resorted to selling their vehicles to make up for cash flow.

Now that the sector has restarted, tourism players have to purchase new vehicles, hire workers, rent offices and pay for utilities, he said.

Recovery will be slow but things are beginning to pick up.

Since Monday, when the interstate travel ban was lifted, and with the adult population vaccination rate now above 90%, room bookings and occupancy rates are improving.

Malaysia Inbound Chinese Association president Angie Ng said travel agents have reserved more than 1,000 hotel rooms and 2,000 tickets to tourist attractions.

As a new approach to making sales in the pandemic, association members began collaborating with e-commerce platform Shopee to promote travel packages. More than 10,000 packages were snapped up even before interstate travel was allowed.

The most popular tourist attractions were Ipoh and Penang.

“The future of tourism is now about co-existing with the virus, where pre-travel Covid-19 testing is part and parcel of the industry,” she said. – October 16, 2021.