Malaysia’s transition to the Covid-19 endemic stage and the reopening of international borders since 1 April 2022 has been a major boost towards the recovery of our tourism sector. However, it is no secret that many tourism enterprises, especially hotels, are still struggling to recover because of various obstacles, including the acute shortage of workers, sudden increase in the minimum wage, and rising inflation.
Therefore, DAP urges the government to extend the targeted Wage Subsidy Programme (PSU) to the tourism and related enterprises in order to ensure the smooth and swift recovery of Malaysia’s tourism sector.
The extended PSU will assist tourism enterprises to cushion the impact of the recent increase in minimum wages and inflation of goods’ prices. In addition, it will enable them to offer higher wages to attract new workers and relieve the labour shortage issue in the short run before they fully recover.
Under Budget 2022, the government has allocated RM600 million in targeted wage subsidies specifically for the tourism sector. This incentive, however, was only for three months and has thus expired.
DAP calls for the government to extend the targeted PSU programme for another three months with an additional allocation of RM250 million. The allocation will be used to provide a wage subsidy of RM300 per month for each employee. In total, the extended PSU will benefit over 20,000 companies and 300,000 employees in the tourism sector.
The RM250 million allocation can be carved out from existing allocations in Budget 2022, such as the RM4.8 billion allocated under the Jamin Kerja initiative, and the RM230 million allocated under the Tourism Recovery Plan.
As such, no additional funds are required to extend the PSU for the tourism sector. All it needs is for the government to be more flexible in responding to the current economic environment and requirements of the tourism sector by readjusting its existing budget allocation.
The second half of 2022 would be critical for the tourism sector as more international tourists will arrive, especially during the year-end holiday season. Without adequate support, tourism enterprises may not be able to cope with the increase in demand. This would not only hamper the recovery of the sector but also leave long-lasting reputation damage due to reduced service quality and experience.
Before the Covid-19 pandemic, our tourism sector used to be the third-largest contributor to Malaysia’s GDP with a gross value added for tourism industries (GVATI) of RM240.5 billion or 15.9 per cent of the GDP in 2019.
The tourism sector is poised to recover and once again be a major contributor to our economy with the reopening of international borders. The government must ensure adequate support, especially by extending the targeted PSU, in order for the sector to smoothly recover and reach its full potential once again.
Khoo Poay Tiong
DAP Spokesperson for Tourism, Arts, and Culture
MP Kota Melaka
