analysis

Everyone directly involved in this country's hospitality industry can see the tell-tale signs - except perhaps the minister of culture, arts and tourism and his top officials - that the tourism industry is in for a tough time.

Indeed, everyone in the industry would laugh off their heads each time the minister or his deputy quote statistics of visitor arrivals, suggesting that more than 10 million tourists visit Malaysia each year.

The trade knows very well that the actual number is probably no more than 30 percent of the figures often quoted by the ministry officials.

After all, London - a global city - receives about 10 million tourists a year, and this is certainly more believable, for the simple reason that the United Kingdom is one of the top economies of the world, is a cultural and educational learning centre, and as such attracts large numbers of visitors from all parts of the globe.

Malaysia, which has a smaller population and is certainly not as well developed as a tourist destination as London, New York City, Hong Kong or even Singapore, cannot possibly be attracting as many tourists.

Dismal picture

In the aftermath of the Sept 11 attacks on New York City and Washington DC, a dismal picture for tourism in this region is expected, and Malaysia is no exception.

Already, Kuala Lumpur hoteliers are talking about room cancellations almost every day from overseas tour wholesalers. One five-star hotel is said to face daily cancellations of 100 rooms.

Even the smaller three-star hotels in the Jalan Bukit Bintang, Jalan Alor and Jalan Tong Sin areas in the heart of the old Kuala Lumpur are reporting the slashing of bookings between 20 percent and 40 percent since Sept 11 - and this comes with the inevitable discounts on room rates.

It is not difficult to obtain a deluxe room nowadays for less than RM100 nett (with breakfast thrown in plus other benefits during one's stay).

The situation will become worse and certainly much clearer in a few months, after the dust has settled down, with either many airlines cutting down drastically on their global services, cutting down on staff strength, selling or leasing out unused aircraft, or even airlines being totally grounded or even folding up such as Australia's Ansett.

Even Malaysia Airlines (MAS) is not spared from the slowdown which is hitting the global tourism and airline industry. MAS has just announced it is going to stop flying to at least 12 cities later this month.

No correct picture

Surprisingly, the 12 destinations include cities that most people thought, or least MAS had led Malaysians to believe, were profitable, and these include New York, Zurich and Rome.

Yet, Sabahans and Sarawakians who have to rely on air to travel to the peninsula have been told so many times in the past that the national airline has been making money on its international routes and has had to subsidise the domestic sector. It would now seem that that is not the correct picture.

"How will the increase in the domestic sector help MAS to go back to profitability?" asked travel agent YS Kok.

"MAS must examine its internal costing and its expenditure across the board, in particular its international network operations," he said.

"If MAS thinks it cannot operate the domestic sector profitably then it must be willing to allow other airlines such as Singapore Airlines to increase their services to Kuching rather than hold on to their rights to the detriments of Sarawakians and Sabahans," said another travel agent who asked not be quoted.

Singapore Airlines operates twice weekly services to Kuching. Although the local business community has supported its request to increase the frequency, MAS has refused to allow it.

Inbound tour operators in the country are also bracing for cancellations of tour groups from the US and Europe because of the fear of flying in the wake of the uncertainties following moves by the US and its allies to hunt down terrorist groups responsible for the attacks and fears of a backlash from pro-Osama bin Laden elements around the world.

MAS to cut jobs

Malaysiakini understands that MAS is contemplating shedding its workforce by as much as 10,000 or more progressively, either through retrenchment exercises or voluntary separation schemes, or both within the next 12 months.

One MAS official in its inventory division said there is a great deal of anxiety especially after the airline management announced the impending cut of its services to 12 destinations.

One tourism official, who declined to be quoted, said increasing MAS services within Asia might look like a logical move but Asia itself is already very competitive. With other Asian airlines expected to do likewise - especially services to North Asia, including China and Taiwan - there will be a price war.

This has led to the belief that MAS itself may well be contemplating fare reduction to Asian destinations in order to help fill up its planes.

Another concern is MasKargo operations which are all long haul because of the type of aircraft it owns. With uncertainties in the global freight industry, as a result of declining imports/exports, the air cargo industry is already badly affected.

Even Singapore Airlines Cargo recently announced the cessation of services to Penang, Malaysia's 'Silicon Island', where most of this country's electrical and electronic goods are manufactured and exported to markets such as Japan, Taiwan, South Korea, Singapore and the US.

"The uncertainties ahead certainly do not augur well for the tourism and airline industries within this country, the region and the world within the next six months or so," said one foreign airline official based in Kuala Lumpur.

TONY THIEN is a malaysiakini correspondent based in Kuching, Sarawak.