MATTA: Too early to gauge tourism recovery

 Monday, April 18, 2022 


Despite reports that Malaysia’s tourism industry is on the mend this year, following the transition to the endemic phase and the reopening of the country’s borders, the sector still lacks positive figures to back up the recovery.

When asked, Malaysian Association of Tour and Travel Agents (MATTA) Vice President inbound and domestic Ganneesh Ramaa said some of the major tourist markets for Malaysia are still in lockdown, mainly countries from the Far East, including China, Taiwan and Japan.

He said it is also still early to speculate that tourist numbers to Malaysia are recovering since the opening of the borders.

The Russia-Ukraine war, on the other hand, will influence global tourism to some extent because it has contributed to increased inflation in some regions of the world, particularly in Europe.

This will also affect the disposable income of the general public, and it will directly contribute to their travel preference, he told media.

Ramaa said domestic travel has resumed since last year, and based on the domestic sales produced at the previous MATTA Fair, travel agencies believe business recovery is on track.

MATTA also expects domestic small and medium-sized companies linked to the tourism industry to record better income and revenue supported by the reopening of borders and the festive seasons.

Despite the positive domestic travel sales, Malaysia’s tourist and hospitality sectors continue to contract due to China’s Zero-COVID policy and pandemic fears among travellers.

China is a major contributor to Malaysia’s tourism arrivals.

In a recent report it is said China’s tourism sector recovery has slowed since mid-2021 and will remain volatile in 2022 as a result of travel restrictions amid a resurgence of COVID-19 cases.

Domestic tourist numbers and revenue in 2021 declined to around 50 per cent of pre-pandemic levels from over 60 per cent in the first half (1H) of 2021 and remained weak entering into 2022.

Fitch believes the government’s COVID-19 policies are mainly driving the sector’s recovery path, and an escalation in virus cases could weigh on tourism activities, putting a drag on China’s economic recovery.

Malaysian Association of Hotels Chief Executive officer Yap Lip Seng said the reopening of the country’s borders from April 1 is good news for the entire tourism and culture chain in the country, which can now generate income.

However, Yap said the reopening could go both ways, especially during the initial implementation period, as more Malaysians could opt to travel overseas instead of domestic.

At the moment, hotels have yet to see any significant pick-up, another consideration is the upcoming fasting month, he said.

According to Yap, before April 1, average occupancy has been hovering between 30-40 per cent, fluctuating between peak weekends and holidays and normal weekdays, and popular domestic destinations fare better than others.

The reopening has yet to record significant increases other than from Singaporeans and some Indonesians.

However, we are hoping for average occupancy between 50-60 per cent by the third quarter of 2022, he said.

On employment, Yap said the reopening of the country’s border would be a confidence boost to the people, assuring that the industry is on track to recovery and business will resume as usual.

He said this should encourage people to return to the industry or take up a hospitality career again.

Hotels have been actively recruiting since last year after the reopening of interstate travel and will continue to manage travellers’ expectations.

Although demand for workers is increasing, interest in hospitality jobs is still low.

Therefore, we need a hospitality branding campaign for the immediate and middle term and a longer strategic plan that would include infiltrating the education system, he said.

The Ministry of Tourism, Arts and Culture (MOTAC) recently said it aims to generate international tourism revenue of between RM47 to RM77 billion by 2025.

Its Minister Datuk Seri Nancy Shukri said the target was through the expected influx of 16 to 22 million international tourists.

MOTAC is also targeting the entry of about two million tourists from abroad to Malaysia this year, generating an income of RM8.6 billion.

However, the agency stated that this is just an initial projection.

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