THE Covid-19 pandemic has caused unprecedented damage to the global economy, especially the tourism industry in Malaysia which has taken a brutal hit. While the Malaysian government has introduced various initiatives to help the industry recover, more needs to be done to ensure that it not only survives but thrives.

The Perikatan Nasional (PN) government, under the leadership of Muhyiddin Yassin, took drastic measures to contain the spread of the virus, and their efforts should be commended. The Covid-19 Tourism Financing (CTF) facility, introduced by the Ministry of Tourism, Arts, and Culture, was a welcome initiative to help SMEs in the tourism sector. The CTF provided financing to tourism-related businesses at a low-interest rate of 3%, with the government guaranteeing up to 80% on the loan amount.

The PN government also introduced several other measures to support the tourism industry during the pandemic. These included the Penjana Tourism Financing, which financed tourism businesses for digitalisation and automation, and the Wage Subsidy Program, which helped retain industry jobs by subsidising employee wages.

However, despite the previous government’s efforts, some hotel industry players expressed disappointment that Budget 2023 did not positively impact them. The President of the Malaysian Budget Hotel Association, Dr Sri Ganesh Michiel, said that the budget should have included specific improvements for the hotel and tourism industry.

According to him, the current government should have made more effective budget allocations to address industry threats and to recover lost revenue from not taking early action. He added that the government should have introduced laws to regulate short-term residential accommodation (STRA) and online travel agencies (OTA).

Sri Ganesh said the tourism industry plays a vital role in ensuring sustainability and driving the hotel industry’s recovery this year. He hopes that the government can consider helping the hotel industry survive and gradually recover.

With the recent formation of the unity government, Malaysians hope that this momentum will continue and that more concrete steps will be taken to support the tourism industry. The government must critically examine the current situation and the measures to support the initiative. As the country moves towards an endemic phase, it is imperative that the government provides targeted and practical support to the industry.

While the government has announced initiatives, it is essential to implement them effectively and reach the businesses that need them the most. The government must work closely with industry players to understand their needs and challenges and tailor their support accordingly.

If the government can’t step up and provide the necessary support for the industry, we may see a new type of tourist attraction, abandoned hotels, empty beaches, and overgrown theme parks. While these may appeal to the more adventurous traveler, they won’t be much help to Malaysians who rely on the tourism industry for their livelihoods.

As the tourism industry significantly contributes to the country’s GDP, the government must provide a comprehensive and sustainable plan to support its recovery. This plan must be well thought out, targeted, and implemented effectively to ensure the industry’s growth and success. 

The government must work closely with industry players and stakeholders to identify their needs and challenges and provide targeted support accordingly. 

Additionally, the government must address the long-standing issues highlighted by the hotel and tourism industry, such as the absence of specific laws to regulate short-term residential accommodations and online travel agencies and the need to raise the annual service tax threshold for the hotel industry. 

Failure to address these issues could lead to further struggles for the industry, causing irreparable damage to the Malaysian economy. The unity government must take bold and decisive action to support the tourism industry’s recovery and ensure its long-term sustainability. 

Only then can we hope to see the return of bustling hotels, lively beaches, and thriving theme parks, providing Malaysians with a source of livelihood and putting the country back on the map as a world-class tourist destination. –  February 28, 2023

* Mahathir Hj Mohd Rais reads The Malaysian Insight.

* This is the opinion of the writer or publication and does not necessarily represent the views of The Malaysian Insight. Article may be edited for brevity and clarity.