While the average Malaysian grapples with the rising cost of living compounded by a depreciating currency, Penang hoteliers are hoping that domestic tourism will pick up this year with fewer people holidaying overseas.

Malaysian Association of Hotels (MAH) Penang Chapter chairman Khoo Boo Lim said domestic tourism was expected to increase this year as more people reduced their spending.

Many will opt to spend their money locally due to the decline of our currency.

The exchange rate now favours foreign tourists, and we also hope that will drive more tourists to Penang and Malaysia, but many are cautious about spending.

“The uncertainties in the global economy and other factors are making people more cautious with money and that includes scaling down their travel plans,” he told The Malaysian Insider in an interview.

Although Malaysia had not suffered terrorist attacks like Jakarta in neighbouring Indonesian, the incident was too close to home and Khoo said hoteliers were concerned about the potential security risks.

He said most hotels were stepping up safety and security measures as a precaution.

He said negative reports about Malaysia were not helping the situation.

Negative reports of our country, involving religious issues and extremism, definitely have an impact on tourism.

“These reports can influence decisions on where to go for a holiday,” he said.

According to MAH records, last year, as the economy slowed, Penang hotels recorded a lower occupancy rate of 54.23% than last year’s 66.36%.

The occupancy rate picked up the second half of last year but still did not surpassed 2014’s rate.

Khoo said hotels would have to strategise to attract more guests, but he hoped they would be doing so by developing value-added incentives instead of cutting their rates.

I hope the hotels will develop value-added incentives, and not just simply throw rates. That is very unhealthy practice for the industry.

“Apart from depending on the leisure market, it will be good to go out to get more corporate travellers and MICE (meetings, incentives, conferences and exhibitions) business.”

Meanwhile, state tourism bureau Penang Global Tourism (PGT) is optimistic about growth in domestic and international tourism due to the weak ringgit.

PGT chief executive officer Ooi Chok Yan said last year’s figures and trends indicate that an increase in domestic tourist arrivals is likely this year.

It comes down to the currency exchange, which puts locals off overseas travel and shifts their focus to domestic destinations.

There is also the potential of our weak currency attracting the interest of more foreign tourists, but we have to look at the accessibility of Penang.

This is mainly to do with the direct flights connecting Penang to different cities. We are in a helpless situation if there are more people willing to travel to Penang, but the seats and flight frequency provided by the airlines are limited.

“The aviation incidents and security concerns may stop some foreign tourist from planning a trip to this part of the world in general and not just Malaysia or Penang,” he said.

Ooi said Penang still “performed” in tourism last year under stable and sustainable condition even though the country saw poor performance in the sector overall.

Malaysian Airports Bhd’s Malaysia International Airports Passenger Movements Record showed that Penang saw the second highest movement among the country’s five international airports in Kuala Lumpur, Kota Kinabalu, Langkawi, Kuching and Penang.

Chief Minister Lim Guan Eng had many times said the airport in Bayan Lepas had hit its maximum capacity of 6.5 million passenger arrivals last year, an achievement that was only expected in 2020.

Ooi said although there was a 4.71% drop in international visitors last year, there was an increase of 8.85% in domestic visitors as of November last year, compared with the corresponding period in 2014.

Both arrivals were via Penang International Airport. It also explains the year-end traffic jam as domestic visitors travel to Penang using all forms of transport, including cars.

Ooi said Penang would be constantly promoted as a tourist destination via traditional and non-traditional marketing methods.

He said PGT would participate in trade shows, roadshows, sales missions and organise familiarisation trips to Penang to showcase its products and attractions.

PGT also creates tactical campaigns at selected periods of time to further attract tourists to travel to Penang. Let’s also not leave out the state’s quality homegrown events that enhance the visitor’s experience.

Some events, such as George Town Festival, already have the ability to pull tourists and cause them to return to Penang.

The George Town Festival is from July 29 to August 28 this year. Other events to draw visitors to the state are the Jade Emperor God Festival (February 15), International Chinese Kung Fu Festival (February 19 to 20), Disney on Ice (March 26 and 27), Penang Anime Matsuri (May 28 to 29), Penang Durian Festival (June 1 to July 31), and Penang International Bridge Marathon (November 20).