Malaysia hotel sector deems new stimulus insufficient

The government should provide broader support to help hospitality players tide through the current nationwide lockdown, say the chiefs of two Malaysian hotel associations in response to the government’s latest round of stimulus aid.

The RM150 billion (US$36.1 billion) stimulus package, known as Pemulih, was announced by prime minister Muhyiddin Yassin on Monday (June 28), and is meant to provide aid to individuals and businesses affected by the extended movement control order 3.0.

Malaysian hoteliers deem the government’s latest stimulus package insufficient to tide through the Covid crisis

Highlights of the package include a wage subsidy programme where the government will support up to 500 workers per employer, with assistance of RM600 per worker for a period of four months. This applies to all sectors for a period of two months in the second phase of the National Recovery Plan (NRP) and a further two months in the third phase of the NRP.

Currently, Malaysia is under phase one of the NRP and will only transition to the second phase when three key threshold value indicators are achieved, namely, the average daily Covid-19 cases drop below 4,000, the rate of bed usage in ICUs remains at a moderate level, and 10 per cent of the population has completed both doses of Covid-19 vaccinations.

Other highlights include a six-month loan moratorium for all income groups with no documents or conditions required in the application, and a 10 per cent discount on electricity bills for three months for economic sectors most affected by the lockdown, namely, hotel and theme park operators, convention centres, shopping malls, and travel and tourism agencies.

There is also a one-off grant of RM3,000 for travel agencies to help them kick-start their business in the third phase of the NRP. In this phase, all economic activities will be allowed to operate, except high-risk activities listed in the ‘negative’ list such as spas, pedicure and manicure providers, pubs and nightclubs.

While the new measures announced will provide some relief to the hospitality industry, hotel associations have noted that it is insufficient to help their members survive in the coming months.

N Subramaniam, president, Malaysian Association of Hotels (MAH), said that the Pemulih package did not address the specific needs of the tourism and hotel industries.

He stressed that the fixed quantum of 10 per cent discount on electricity bills is hardly sufficient, considering average hotel occupancy is at most 20 per cent for the coming months due to extended travel restrictions.

He added: “Although the government recognises the impact on the tourism industry, the one-off financial assistance of RM3,000 is only offered to travel and tour operators. Hotels are not included, although they are sustaining heavy losses and cash flow burden.”

While MAH welcomed the “blanket” loan moratorium that could provide much-needed relief, Subramaniam opined that it should be interest-free to ensure borrowers do not fall into deeper debts.

Malaysian Association of Hotel Owners executive director, Shaharuddin M Saaid, shared there was nothing “extra” or “special” in the stimulus package that could help hotels survive in the coming months.

He asked: “How are hotels to survive when inter-district and interstate travel are not allowed? Hotels are allowed to operate but not allowed to take guests for tourism and no dine-ins are allowed.”

Shaharuddin also pointed out that the wage subsidy programme will only kick-in when the NRP moves into Phases 2 and 3, with the timeline uncertain. He added that the way forward would be for the government to meet with industry players to devise a workable tourism restart plan.

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