While the total allocation of RM1.6 billion will help boost the tourism industry, many factors need to be taken into consideration, they say.
Hotel industry players have welcomed the overall allocation of RM1.6 billion in next year’s budget for the development of the tourism industry although they question the share set aside for marketing initiatives and incentives, saying this might not be enough to boost local tourism in the wake of the Covid-19 pandemic.
Finance Minister Tengku Zaful Aziz, in presenting the budget for 2023 in the Dewan Rakyat last week, had announced RM200 million to strengthen the recovery of the tourism sector with incentives, promotions and marketing initiatives.
The government is also targeting more than 15 million foreign tourist arrivals, with a projected revenue of RM47.6 billion.
However, the Malaysian Association of Hotels (MAH) said the allocation for marketing aid was less than 0.5% of the expected revenue.
“While we have seen an uptick in tourist arrivals, as of July 2022, Malaysia had recorded only 3.2 million tourist arrivals with tourism receipts of RM9.4 billion for the year 2022,” MAH president Christina Toh said.
Speaking to MalaysiaNow, she said this was a far cry from pre-pandemic numbers such as the 26 million tourist arrivals and RM86.1 billion and change in revenue seen in 2019, the year before the onset of Covid-19.
She voiced hope that the government would consider a number of proposals to support the recovery of the hotel sector, such as discounts for water and electricity bills, and the regulation of home-sharing sectors like Airbnb.
“This would provide a level playing field for all industry players,” she said.
Toh also urged the government to extend personal tax reliefs for domestic travel in the year ahead, and provide discounts in assessment rates and quit rent.
As of 2020, more than 3.46 million people were employed in the tourism industry, which was among the worst hit by the movement controls and border restrictions imposed to curb the spread of Covid-19.
In its budget for 2023, the government had announced a slew of other aid measures including RM25 million for incentives to encourage domestic travel.
These, it said, would come in the form of discounts, vouchers and rebates for accommodation, tour packages, handicraft and artworks.
But Fathir Badri, president of the Solidarity Association for Travel & Tours Agency Malaysia, said the total amount of RM1.16 billion would help the local tourism industry regain its footing.
He said the RM25 million for incentives, to be channelled directly to the people, would speed up domestic tourism business.
While he also praised the RM90 million set aside through the Galakan Melancong Malaysia grant, however, he suggested that the government look into the lack of manpower – an ongoing problem across many economic sectors.
“Hotels are unable to fully reopen, as are travel agencies which are having trouble finding workers,” he said.
He also urged against the administration of the RM500 million in Bank Negara Malaysia tourism financing by banks, saying this would not help industry players.
Instead, he said, such funds should be managed by the tourism ministry itself, which he said had a better understanding of the industry needs.
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