From VM2020 cancellation to MCO, hospitality players fight for survival

Stimulus or borrowing can possibly help businesses sustain during these times, but there are risks to consider


HOSPITALITY players — among the worst hit by the Covid-19 pandemic — said they are not prepared for the cancellation of the Visit Malaysia 2020 (VM2020) campaign, but will continue to fight for the industry’s survival.

The industry added that the Movement Control Order (MCO) imposed last Wednesday hurt the industry, but agreed that prevention is required which will lead to a faster recovery.

The Malaysian Association of Tour and Travel Agents (Matta) VP Mohd Akil Yusof said there is little the tourism industry players can do to boost the market at the moment.

“The MCO does not encourage domestic tourism. Just to eat is difficult, to visit others is troublesome and if you make the wrong step, you may wind up getting charged. So, how can we have a Plan B for domestic tourism?” he told The Malaysian Reserve (TMR) recently.

Mohd Akil said the players have to take into account how other sectors are affected as most are also in a standstill.

“Disposable income may take some time to accumulate, plus the MCO has instilled fear in people to go anywhere after hearing how other countries or states have decided to exercise the order, which is another blow to umrah and haj.

“The tourism industry, especially the travel agent segment, is the most affected, with the VM2020 campaign cancelled. This means no extra money for promotion to attract people to destinations in the country, be it domestic or international arrivals,” he said.

The campaign was cancelled by the Ministry of Tourism, Arts and Culture in light of the Covid-19 outbreak, and was effective immediately alongside the freeze of all over-the-counter and online services for the ministry’s tourism licensing division.

The freeze includes the ministry’s state offices such as tour guides, tour drivers, tourism training institutes and registration of tourism accommodation premises, spa centre and foot massage centres, effective until March 31.

Mohd Akil added that stimulus or borrowing can possibly help businesses sustain during these times, but there are risks to consider. “What if Covid-19 comes back or is followed by other unfortunate events? Businesses have to consider these risks and how to pay back any loan,” he said.

He added that the MCO is a must to curb the spread of Covid-19, but unfortunately, the price to pay is high for the industry players.

“Just imagine if Malaysia exercised a stricter MCO much like in Wuhan, which lasted almost two months” he said.

Malaysian Association of Hotels CEO Yap Lip Seng believes the MCO is needed for the time being.

“The MCO is to contain the virus and ensure it doesn’t spread further. This means businesses can recover earlier,” he said.

With the cancellation of the VM2020 campaign, hotels are now focusing on survival as the industry faces a gloomy outlook.

Initially, MAH was hopeful the situation would improve by June and slowly recover as July rolls in, while hotels would be able to take advantage of domestic travel, but with the order announced, it is hard to see improvements as all industries move into the second quarter of the year.

As of March 16, the pandemic has caused 170,085 room cancellations valued at RM68 million in total.