Hoteliers look at boosting local tourism to fill void left by foreigners

Star Media Group chief executive officer Andreas Vogiatzakis (left) greeting (second from right) MAH chief executive officer Yap Lip Seng, vice president Michael Quay, and Secretary-General Christina Toh while SMG chief revenue officer Lydia Wang looks on.

THE Malaysian Association of Hotels (MAH) is looking at boosting local tourism to fill the void left by foreign travellers following the Covid-19 outbreak.

MAH vice-president Michael Quay says the government should find a way to promote tourism and travel within the country.

“We know people want to travel to China but can’t; But that does not mean they wouldn’t want to travel anyway. This is why we feel that they should travel within Malaysia as there are so many unexplored places to go to. The recent reduction in toll rates will definitely help as well, ” he tells StarBizWeek.

Quay says the current situation should be viewed positively and looked at as a valuable, learning experience.

“We spoke to airline companies and learnt that there have been plenty of cancellations to outbound flights.

“So this should be considered a valuable opportunity to promote and increase travel within the country.”

MAH Hotels Training and Education Centre chief executive officer Yap Lip Seng says the Malaysian hotel sector has been hit hard by the Covid-19 epidemic, with estimated losses totalling RM66.82mil within less than two months of this year.

Since the outbreak, he says the association had recorded a total of 157,525 room cancellations from hotels nationwide as at Feb 17.

“Surprisingly, for the month of January, many hotels reported extremely positive numbers, until the 25th when the Chinese government announced they were going to block their own citizens from booking hotels and tours.

“Up to then, most hotels reported positive growth for most of January but then the Covid-19 hit us all badly.”

According to Yap, hotels in Kuala Lumpur were the worst hit with RM22.17mil in losses, followed by operators in Sabah at RM11.55mil. Penang was the third highest, recording losses totalling RM8.76mil.

According to statistics, travellers from China consistently make the top 10 list of international tourist arrivals in Malaysia. In the first half of last year, the country recorded 1,558,782 tourist arrivals from China; the Chinese accounts for 11% of Malaysia’s total tourist market.

Yap says Malaysia is targeting 3.48 million Chinese tourists for Visit Malaysia Year 2020.

“But that’s still a small amount compared with countries like Thailand, which attracted between 11 million and 12 million travellers last year.

“Our numbers show that Singapore is number one but we don’t know if they’re tourists or not.

“They may just come in to buy things that are cheaper or if they’re just staying with family or have a home or just visiting friends. They don’t really contribute to tourism that much. The second highest is Indonesia.”

On top of the Covid-19 outbreak, Yap says the local hotel industry is also facing stiff competition from Airbnb operators.

“Last year, Airbnb announced between 53,000 and 54,000 listings in Malaysia. In Kuala Lumpur alone, there are between 17,000 and 18,000 and they claimed to have generated RM3bil for the country, so to speak. But it goes nowhere. It goes to the homeowners. They use it to pay their loans; it doesn’t come back to the tourism industry at all.

“This is the same chunk of money taken from the people working in a hotel. If they didn’t stay in an Airbnb, there would be a 6% service tax imposed and that will go to the government. It is a leakage from the system and it’s not healthy for the industry.”

Yap says because the Airbnb segment is not regulated, its operators are not well prepared to deal with the Covid-19 outbreak.

“Unlike hotels, Airbnb operators don’t have the standard operating procedures in place to deal with something like an epidemic.”

He adds that hotel operators, on the other hand, are better prepared to deal with such situation.

“Hotels must all comply with the Registration of Guest Act, where we must register guests that stay on the premises so we know exactly where they’re from and when the authorities request for it, we have to provide that information.

“For Airbnb operators, they don’t have that, so if you want to trace somebody from Wuhan that stayed here, you won’t be able to trace where he or she was. So you cannot contain the spread in that sense.”

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