Tuesday, November 24

No clear skies for MAHB until 2021

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Malaysia had imposed an entry ban on travellers from countries recording more than 150,000 cases of Covid-19 in early September 2020. — Bernama photo

KUCHING: Times will continue to be tough for Malaysia Airports Holdings Bhd (MAHB) on the back of sparse international flights as strict travel restrictions continue, with analysts saying to likely remain in place until 2021.

The team at Affin Hwang Investment Bank Bhd (AffinHwang Capital) saw that the international passenger movements for MAHB’s Malaysia operations have plunged by 98 to 99 per cent year on year from April to August 2020, largely attributable to the complete closure of Malaysia’s borders to tourism and sharp reduction in business travels.

Looking into the fourth quarter of 2020, it expect international passenger movements to remain at this depressed level due to the extension of the restricted movement control order (RMCO) to end-December 2020 and the banning of citizens from several countries from entering Malaysia.

“Malaysia’s travel bubble plan has been put on hold indefinitely. The rise in the number of Covid-19 cases in many parts of the world has thwarted the government’s initial plan to set up travel bubbles between Malaysia and other countries around the region,” it said today.

“Malaysia had wanted to establish travel bubbles with New Zealand, Australia, Japan, Singapore and South Korea that were previously considered as Covid-19 green zones.

“Looking abroad, the travel bubble between New Zealand and Australia, touted to be the first of its kind in the world during Covid-19, is put on hold until at least March 2021, if not later.”

Meanwhile, according to the World Tourism Organization’s (UNWTO) latest report on Covid-19 related travel restrictions up to September 1, 2020, it was discovered that a total of 115 destinations (53 per cent of all destinations worldwide) have eased travel restrictions, an increase of 28 since July 19 this year.

Of these, two have lifted all restrictions, while the remaining 113 continued to have certain restrictive measures in place.

According to the report, destinations that have eased travel restrictions are: 44 destinations in Europe, 27 in the Americas (including 18 Small Island Developing States), 26 in Africa, 13 in Asia-Pacific and 5 in the Middle East.

Destinations that have eased travel restrictions generally have high or very high levels of health and hygiene infrastructure. They also tend to have comparatively
low Covid-19 infection rates.

Within advanced economies, 79 per cent of tourism destinations have already eased restrictions. In emerging economies, just 47 per cent of destinations have done so, while 64 per cent of those destinations that have eased have a high or medium dependence on air as a mode of transport for international tourist arrivals.

“At the same time, the report shows that many destinations around the world are extremely cautious about easing travel restrictions,” AffinHwang Capital added. “About 93 destinations (43 per cent of all worldwide destinations) continued to have their borders completely closed to tourism, of which 27 have had their borders completely closed for at least 30 weeks.

“These destinations (complete closure of borders to tourism) include Malaysia and a good number of Malaysians’ favourite travel destinations and countries with normally high numbers of tourists to Malaysia, ie. Indonesia, China, Australia, Thailand, India, Vietnam and Korea.”

Malaysia continued to impose strict travel restrictions following the RMCO on August 28, 2020 which includes the closure of international borders to tourism, to December 31, 2020.

Subsequently, the government had in early September 2020 imposed an entry ban on travellers from countries recording more than 150,000 cases of Covid-19. The restricted countries include the US, Brazil, France, United Kingdom, Spain, Italy, Saudi Arabia, Russia, Bangladesh, India, Indonesia and the Philippines.

The ban involves six categories of pass holders, including permanent resident (PR) status, Malaysia My Second Home Programme (MM2H) participants, expatriates including professional visit pass (PVP) holders and resident pass holders, spouses of Malaysian citizens and their children as well as students who want to return to Malaysia.

“In our view, the extension of the RMCO and banning of citizens of countries with a high number of Covid-19 cases indicate that the Malaysian government remains very
cautious on the Covid-19 pandemic and is unlikely to reopen the country’s border to tourism anytime soon,” the research firm continued.

“Moving into 2021, we expect the Malaysian government to gradually reopen the border. In the early phases, we expect the reopening to be carried out on a measured, controlled manner and only for selected countries with a low number of Covid-19 cases.”