Everything you wanted to know about Penang’s tourism industry and how the state is coping with Covid-19.
In conjunction with George Town World Heritage City Day, Lifestyle Asia KL speaks to Penang State Executive Councillor for Tourism and Creative Economy YB Yeoh Soon Hin on the state’s relief efforts in the aftermath of Covid-19, which has drastically upset one of Penang’s economic pillars.
Tourists flock to George Town for its amazing array of street food and vibrant cultural attractions. Since the historical heart of the city was designated by UNESCO in 2008 as a World Heritage Site, the capital city of Penang has experienced a renaissance. Glorious boutique hotels restored from dilapidated colonial buildings now dot the cityscape, while on the horizon, upmarket condos are reaching skywards along Gurney Drive.
The mounting pandemic puts a halt not only to the influx of tourists – Penang International Airport was bursting at the seams – but also livelihoods of those who depend on the tourist dollar. Several established hotels, including the five-star Hotel Equatorial Penang, have shuttered. The iconic See Kong Ooi restaurant was 84 years old prior to becoming a victim of the pandemic. With the state remains off-limits to international and domestic tourists from other regions within Malaysia, will Penang rebound?
Penang has long been famed as the Silicon Valley of the East and the Pearl of Orient. The former stems from our robust manufacturing background that contributes to 46% of the state’s gross domestic product (GDP). Meanwhile, our services sector – which is mainly driven by the tourism industry, has provided significant employment and economic opportunities – surpassing the manufacturing sector by recording a GDP of 49% during the pre-pandemic era.
Unfortunately, Penang was not spared from the merciless repercussions and consequences of the Covid-19 pandemic. Unemployment, cease of operations and the livelihood of tourism players were amongst the pressing concerns to the state government ever since the pandemic outbreak.
Thankfully, our range of aid packages and initiatives have cushioned our tourism operators from experiencing further losses and upheld sustainability for the industry as a whole.
The Penang state government through the Penang State Executive Councillor’s Office for Tourism and Creative Economy (PETACE) has launched macro and micro initiatives to mitigate the impacts caused by the pandemic.
From a macro-outlook, we have established the Penang Tourism Economy Recovery Advisory Board (PETERAB) that was tasked to spearhead socio-economic impact through policy-level recommendations, with the ultimate goal of accelerating tourism recovery, generating employment and economy synergy to increase tourism receipts and foreign direct investments.
This advisory board works in tandem with the Tourism Penang Next Normal Task Force which guides the transition towards the “next norm” to ensure enhanced safety and security of tourists and employees. As we scale down into micro initiatives, the Penang State Government through the People Aid’s Package has provided direct and concentrated financial assistance to the tourism players.
Other than unveiling zero-interest loans such as Skim Peka 2.0, Skim Peka 2.1 and rounds of moratoriums, we also announced an additional RM1 million electrical bill subsidies. Meanwhile, other notable one-off allocations include RM1,368,500 for registered tourist guides; RM1,464,500 for hair salons, spas, reflexology centres, etc; RM31,500 for mobile spa; RM100,000 for events management companies.
Prior to the pandemic, Penang was on track to kick start one of our largest tourism campaigns (Experience Penang 2020) that encompasses mega-scale international events and launching of new direct flights. However, all of these efforts have come to a temporary halt as the virus continues to plague our streets and affect livelihoods.
As such, our tourism landscape has observed the paradigm shift from international markets to domestic markets, focusing on local demands to keep businesses intact. On a separate note, pre-pandemic policy-making was development-oriented and geared towards achieving rapid upgrade for the industry as a whole. Nevertheless, the pandemic has restructured policy-making.
Instead of seeking to thrive, we have pivoted our focus towards sustainability and survival. Our current policies are aimed at economic recovery to ensure a sustained and resilient growth in the tourism industry, as opposed to accelerating growth and large-scale upgrading, which was focused previously.
As a state which is largely dependent on tourism as our economic driver, Penang looks forward to rebound and achieve a “V-Shape” recovery once travel activities resume. Penang also wishes to remain competitive and relevant in the post-pandemic era to maintain at the forefront of the tourism sector.
Speaking of which, the Penang state government through this pandemic has learned the vital lesson that “trust is the new currency”. With this motto in place, we seek to navigate Penang towards becoming a trusted and responsible tourist destination.
This is apparent through the “Responsible Tourism” campaign that is aimed at educating all entities pertaining to their respective responsibilities in keeping Penang safe throughout their travel endeavours. This campaign works alongside and complements the “Covid-19 Safety Accreditation Programme”, which is an accreditation awarded to tourist sites such as hotels, theme parks and malls which fulfil stringent safety and health guidelines outlined by the authorities.
Furthermore, Penang is in pursuit of the Covid-19 Immunisation Programme for the Sustainability of Tourism Industry, which now awaits approval and vaccine supply from the federal government. All of these are pragmatic measures which will strategically equip our tourism players with enhanced capacity to brave the new norm; and position Penang as a responsible tourist destination.
According to a global survey conducted by the United Nations World Tourism Organisation, 49% among the panel of tourism experts foresee international tourism to rebound (to 2019 levels) in 2024, whereas 36% expect the aforementioned to occur in 2023. Essentially, resumption of travel activities is largely dependent on the pandemic’s situation and volatility.
Hence, it is safe to say a controlled, stable and safe pandemic condition is a prerequisite to tourism’s reopening.
As an example, when Malaysia observed a subsided and controlled virus outbreak in December 2020, Penang recorded satisfactory tourism benchmarks by achieving an 82% occupancy rate for beach hotels; 51% for city hotels and 62% for mainland hotels. However, these statistics plunged once again when the Movement Control Order was implemented again due to the slate of Covid-19 cases in Malaysia.
Regardless of when the borders will reopen, our primary role as a state government is to ensure that our tourism players are well-informed and well-prepared for the occasion, in terms of capacity and sustainability.