Extreme Measures Needed to Save Tourism Industry, says MATTA

Kuala Lumpur, 14 January 2021 – The Malaysian Association of Tour and Travel Agents (MATTA) urges the Government to be proactive and to come up with an enhanced and targeted rescue plan for tour and travel agents in light of the recent announcement of the Movement Control Order (MCO) and the bleak forecast on travel this year.

MATTA President Datuk Tan Kok Liang said, “Tourism businesses are currently in extreme distress due to the very fragile and uncertain business environment which is expected to continue late into 2021. Tour and travel agents have been battling with collapsing revenue and liquidity problems since the start of the pandemic and the Government’s efforts have not made any significant impact on this segment of the industry.”

“Tour and travel agents are essential to Malaysia's economy as the majority of these businesses contribute significantly to inbound traffic into Malaysia in the form of both leisure and business travellers. Many agencies also provide crucial logistics services and maintain fleets of buses and other tourist vehicles vital to the tourism infrastructure of the country.”

“Tourism has also played an important part towards the national GDP and it is the third largest contributor in the previous years. The industry supplied 14.1% (RM166bil) in 2015, 14.5% (RM182bil) in 2016, 14.6% (RM201bil) in 2017, 15.2% (RM220bil) in 2018 and 15.9% (RM240bil) in 2019 to the country’s GDP. For 2020, the COVID-19 pandemic had vastly affected the tourism industry with an estimated total loss exceeding RM100 billion.”

“While the hotel industry is expecting more hotels to close or wind-up due to the second phase of MCO and continuous closure of borders, more travel agents especially those owning tourism vehicles are very likely to face the same fate as those hoteliers.”

“Tourism businesses are expected to suffer more losses and the Government must provide an extension on the loan moratorium and enhanced wage subsidy programmes until 30 June 2021. Reliefs on rental, insurance and statutory licensing fees are also needed to help those who are affected especially the SMEs who have already had to burn a lot of cash just to survive the last MCO.”

“MATTA also urges travel businesses to go for consolidation and mergers. Over 5,000 travel companies are now in the ‘ICU’ condition and the Government needs to initiate rehabilitation programmes as the situation will get worse. Allowing travel agents to close business premises and operate from home and the cancellation of the mandatory Travel & Tours Enhancement Course (TTEC) programs for travel companies are good gestures of support.”

MATTA has urged employees of travel agencies to go for re-skilling during this challenging time. However, the association was disappointed that the Government did not allocate funds for re-skilling tourism workers at large apart from the 8,000 aviation workers as announced in Budget 2021.

“It is also imperative for the Government to resolve the issues on deposits held by airlines and related service providers, make urgent corrections to the (outdated) Tourism Industry Act 1992 and provide flexibility of approval for conversion of tour buses into other categories in order to allow these buses to be utilized for other purposes - these are practical measures that the Government needs to assist.”

"The tourism sector has been burdened by bureaucracy and over-governance affecting the industry's regional and global competitiveness. Overlapping jurisdictions by multiple government agencies has stifled the industry over the many years."

“It is no longer 'business as usual' under the COVID-19 pandemic and we urge the various government agencies to make immediate policy changes to ease the financial burden of the hardest hit industry in Malaysia,” concluded Tan.

President MATTA
Term 2019 – 2021

For further information, contact:
MATTA Communications Department, communications@matta.org.my or 03-9222 1155.