Hotels facing RM1b loss

PETALING JAYA: The hotel industry is expected to lose RM1 billion in potential income now that the movement control order (MCO) has been extended for another two weeks.

Malaysian Association of Hotels (MAH) chief executive officer Yap Lip Seng said this was mainly due to hotels being unable to take in new guests while the MCO is in force.

“Hotels are considered an essential service, but we can cater only to those who are stranded, particularly foreign guests,” he told theSun yesterday.

He said the occupancy from these guests was hardly sufficient to cover operational costs.

“At this juncture, the industry has also seen a loss of RM75 million in potential revenue due to cancellations,” he said.

Yap said there had been more than 193,000 cancellations since March 20.

He said the hardest hit was Kuala Lumpur with 61,859 room cancellations followed by Sabah with 33,769 and Selangor with 25,940.

Yap said the MCO had already cost the industry about RM550 million in revenue, and the extension would put losses in the region of RM1 billion.

He said even before the MCO, tourists had been cancelling their bookings due to the Covid-19 outbreak.

Yap said jobs were at risk as losses continued to mount and the government needs to step in to support the industry.

“A survey carried out by the MAH found about 9% of employees in the hotel industry have already taken a pay-cut, 17% had been put on unpaid leave and 4% were laid off,” he said.

He said MAH had put forward several financial proposals for the government to look into to lessen the burden on the industry.

On top of the stimulus packages, he said, the government should instruct banks to waive interests on loans temporarily.

Among the proposals put forward was for the government to subsidise the payroll of employees by RM800 each, waive quit rent and assessment rates of hotel property for 2020, and leniency by the Human Resources Ministry in extending unpaid leave for hotel industry employees. – By Rajvinder Singh