Tourism industry: Expectations for 2021

KUALA LUMPUR (Dec 26): The tourism industry took a heavy blow from the Covid-19 pandemic in 2020. With international borders closed and movements restricted in an effort to stem the spread of the virus, many hotels shuttered, amusement and theme parks closed while leisure travel ceased.

All these caused massive job and revenue losses.

Malaysian Association of Hotels CEO, Yap Lip Seng told The Edge Malaysia that by end-2020, between 10% and 20% of the industry’s workforce would have been retrenched. Most of the remaining employees are on unpaid leave or have had to endure pay cuts.

Should hoteliers be optimistic for 2021? “We are seeing pent-up demand for the year-end, which may extend into the first quarter of 2021,” Yap said, adding that there has been support from domestic tourism.

For the future, he suggested a change in the way room rates are managed “when we start to welcome international tourists” again next year.
Malaysia’s room rates are supposed to be among the cheapest, so Yap feels that should be hiked next year to “achieve an ADR [average daily rate] that is higher than pre-Covid-19 levels, targeting international travellers”.

He explained to The Edge that this “will be possible” as foreign tourists “would not be able to compare past prices” and the “pent-up demand is expected to be far greater than the urge to compare”.
Meanwhile, Malaysian Association of Amusement Theme Park and Family Attractions (Maatfa) President Tan Sri Richard Koh revealed that the second round of conditional movement control order (CMCO) resulted in 10 of its members closing permanently in the fourth quarter.

Koh suggested that to manage pandemics in future, MCOs on targeted areas or clusters should be used instead of blanket restrictions to “allow visitor numbers to improve and the industry to recover”.

He added that Maatfa should have been “more involved at the onset of the pandemic”.

“This could have led to our having a louder voice on the government’s policies on the overall tourism strategy and incentives for the industry,” Koh explained.

Going forward, operation will have to change. “Technology will be more seamlessly integrated into theme park operations. Fewer people will use cash, and ticketing and ride reservations will be digitised,” Koh said.

As for travel agents, Malaysia Association of Tour and Travel Agents (MATTA) President, Datuk Tan Kok Liang said the “tour and travel agent industry is facing immense cash flow problems with near to zero revenue since March”.

“With the pandemic unresolved, coupled with the global recession, there will be weak demand, especially in the leisure travel segment,” Tan told the weekly, and expects things “to get worse in 1Q2021 before the industry starts to stabilise”.

His hope is that a vaccine will be “widely available for travellers and most Malaysians by 1Q2021 and that health and safety protocols, including policies for quarantine measures, will be reviewed.”