The local tourism and hotel industry battered by the Covid-19 pandemic may see major cost-cutting measures as various states fall into another round of Movement Control Order (MCO), says Malaysian Association of Hotels (MAH) chief executive officer Yap Lip Seng.
Yap believes hoteliers may also consider temporarily shutting down their premises until the end of this year if the situation worsens.
"The industry does not know how long this pandemic will last. Hoteliers will be forced to take more cost management measures soonest possible. They have yet to also decide whether they will close for sure this year albeit temporarily," he told NST Property.
Yap said hotel and resort owners are still considering the situation and for more clarifications on restrictions and standard operating procedure (SOP).
He believes that full recovery of the local tourism industry is not expected till 2025.
He expects the return of international arrivals to commence in the third quarter of next year in stages as more of the world's population would have taken the vaccination.
Since the first Movement Control Order (MCO) imposed on March 18 last year, many hotels across the country have closed for business.
Between March and October 2020 alone 109 hotels and short-term accommodation providers ceased operations due to heavy loss of income.
Yap had said that for every two weeks of the MCO, the industry loses around RM300 million.
In 2020 alone the industry lost an estimated RM6.53 billion.
MAH president Datuk N Subramaniam said the industry is again left helpless because of the MCO, which came right in the middle of the holy month of Ramadan.
"This is the time when hotels are busy preparing for the coming Hari Raya holidays and serving the once-a-year festival buffet for breaking fast. The industry understands the need for restrictions to be in place but there is room for improvements in balancing lives vs livelihood. Hotels were already badly impacted with the extended interstate travel restrictions and now even RMCO to RMCO travel has been suspended," he said in a statement.
Subramaniam said last year the hotel industry lost at minimum RM135 million in food & beverage revenues as it was MCO for the entire fasting month.
He said since the beginning of Ramadan, hotels had adjusted their breaking fast buffets to the new norm, with added SOPs in place to ensure the hygiene and safety of guests.
"The blanket ban on dine-in left hotels in predicament with only days to reorganise what was planned for the entire month. Hotels are not only left with excess supplies of perishables but also committed manpower for the period," he said.
Subramaniam claimed the government did not offer any support or assistance leaving hotels high and dry with cancellations pouring in for room bookings planned for the Hari Raya holidays.
He said with the current situation that cuts off all revenue streams, the industry is willing to impose stricter SOPs such as lower capacity limit, served-buffet service or limit of two per table, limited dining time, increased screening, and even mandatory testing for hotel guest from different states checking-in.
"The government needs to consider these options before imposing blanket bans, to allow the industry to at least survive on its own. We have seen a similar situation in other countries and the governments there provide subsidies to businesses for losses due to the inability to operate, in accordance to either business hours affected or volume, whichever applicable," he said.
Subramaniam said looking at the deteriorating situation that will likely be extended, Malaysia needs to plan ahead with a systematic subsidy system for businesses affected by the MCO.
"The government must also speed up vaccination plans especially for economic front-liners like hoteliers and find ways to procure more vaccines. At the current rate, it is highly unlikely that Malaysia will achieve herd immunity any time soon," he said.