Cover Story, Current Affairs, National

Tourism industry: Govt should offer financial aid & correct false projections

Speech by DAP Secretary-General and MP for Bagan, Lim Guan Eng in Parliament on 8 December 2020:

The Government Should Offer Substantial Financial Aid To The Tourism Industry To Compensate For The Losses In Revenue Of RM54 Billion For The First 9 Months Of 2020 And Correct Its False Projections Of 61.1% And 58.4% Hotel Occupancy Rate For 2020 And 2021 Respectively.

 

The tourism industry is the biggest victim of Malaysia’s triple crisis of political instability, economic recession and COVID-19 public health pandemic. Failure to address the triple crisis has contributed to Malaysia suffering the humiliation of being the first ASEAN country to have our sovereign credit ratings being downgraded by Fitch ratings agency, the first time since the 1997/98 Asian Financial Crisis.

The impact from COVID-19 on the tourism industry can be evidenced by the 78.6% drop in tourist arrivals between January and September this year of 4.3 million tourist arrivals, compared with 20.1 million in the same period in 2019. The lower number of tourist arrivals also saw receipts from tourism drop by 80.9% to RM12.6 billion for the first 9 months of this year compared to RM66.1 billion for the corresponding period in 2019.

 
For illustrative purposes.
 

This shocking loss of RM54 billion in tourism revenue for the first 9 months of this year, has crippled the tourism industry with loss of jobs following the closure of not only hotels, travel agencies and operators but also threatens the airline industry. With the spike in the number of COVID-19 infections which hit a record 1,600 yesterday despite the easing of lockdown restrictions, tourism industry will still be dependent on “life-support”.

Malaysia’s Covid-19 crisis is in a worse state than in Indonesia, reportedly 2,234 cases per million population in Malaysia compared to 2,096 cases per million in Indonesia. The total number of Covid-19 cases (72,694) was expected to exceed China’s total of 86,619 in the next 10 days.

Unfortunately, there is a complete lack of adequate financial rescue measures by the PN Federal government to compensate for the loss of RM54 billion in tourism receipts. Financial grants and loan credits are insufficient, and the loudest complaint is the difficulty to secure loans from banks.

 
Lim Guan Eng speaking in Parliament earlier this year.
 

And yet the government continues to adopt an “ostrich in the sand approach” by predicting that the average hotel occupancy for 2020 will be 61.1% and 58.4% in 2021.

 

Such false and unrealistic rosy projections will not help the tourism industry to survive.


The government should offer substantial financial aid to the tourism industry to compensate for the losses in revenue of RM54 billion for the first 9 months of 2020 and correct its false projections of 61.1% and 58.4% hotel occupancy rate for 2020 and 2021 respectively. At the same time banks should not make it difficult for businesses to secure loans.

Lim Guan Eng
DAP Secretary-General
MP for Bagan

Leave a Reply

Your email address will not be published.