Rising hotel prices, frequent security issues threaten tourism industry

KOTA KINABALU: In light of the persistent depreciation of the Malaysian Ringgit (MYR), it is imperative for the government to take proactive measures to bolster the national economy’s stability, said MCA Deputy Secretary General Dr Pamela Yong.

She said this can be achieved through robust promotion of tourism and export trade, particularly amidst challenging economic conditions.

According to recent statements issued by the Malaysian Hotel Association (MAH) and the Malaysian Budget & Business Hotel Association (MyBHA), the government’s increase in the Sales and Services Tax (SST) to 8 per cent, rising electricity and water charges, increasing operating costs, and the upcoming implementation of the electronic invoice policy will lead to a 30 per cent to 40 per cent increase in hotel room rates.

Adding to the current challenges are recent security incidents that have garnered international attention, such as the shootings at Kuala Lumpur International Airport and in the waters off Kunak, Sabah, along with frequent incidents of car window smashing and robberies.

Pamela said these events are likely to significantly undermine the confidence by both domestic and international tourists in visiting Malaysia, thereby exacerbating the already struggling domestic tourism industry.

According to her, tourism stands as one of the main pillars of the Malaysian economy. Amidst the ongoing depreciation of the MYR, Malaysia’s tourism sector holds inherent competitive advantages and allure. However, the rising hotel prices and frequent security incidents have significantly affected the industry.

Tourists may choose to forgo visiting Malaysia due to increased travel costs or personal safety concerns. They may also compare Malaysia to other neighbouring countries and decide not to visit due to higher travel costs.

“We call upon the government to urgently address the ramifications of the recent surge in security concerns. While actively promoting Malaysia’s tourist attractions, it should consider offering tax incentives and financial assistance to the hotel industry, aiding them through this challenging phase. Such measures would indirectly bolster the competitiveness of Malaysia’s tourism sector.

“Being a Sabahan myself and the MCA Sabah Wanita chief, I strongly implore the Sabah Minister of Tourism, Culture, and Environment, Datuk Christina Liew, to take immediate action rather than solely issuing statements. It is imperative that she ensures the safeguarding of Sabah’s tourism industry, considering its pivotal role in the state’s economy,” said Pamela in a statement on Tuesday.

According to the Sabah Regional Tourism Satellite Account (RTSA) report, she said a collaborative effort between the Department of Statistics and the Sabah Tourism Board, Sabah’s tourism sector contributed a substantial RM13 billion to the industry in 2022, representing 10.7 per cent of the state’s total economic output. This data underscores the critical importance of Sabah’s tourism industry, as any disruption in its operations would have farreaching implications, impacting not only the state government’s revenue but also the overall economic progress and the livelihoods of its residents.

“Therefore, it is imperative for Liew, to engage in hands-on field research and swiftly devise effective strategies to ensure the sustained growth and stability of the tourism sector,” she added.