The sector risked falling behind as local businesses struggled to adapt to new trends (Photo: Malaysia Tourism)
The Malaysian Tourism Federation (MTF) has called for immediate and comprehensive reforms to the Tourism Industry Act 1992 to maintain Malaysia’s tourism industry’s competitiveness and relevance.
In a press statement, Tan Kok Liang, President, MTF, said that without the reforms, the sector risked falling behind as local businesses struggled to adapt to new trends, technological changes and shifting consumer demands.
Tan Kok Liang
“The tourism sector cannot afford further delays. The current regulations have been outdated for over two decades and no longer effectively address the industry’s evolving needs,” Tan said.
He stressed that as a vital part of the economy, Malaysia’s tourism sector requires modern, flexible, and forward-thinking regulations to support its growth and sustainability.
Tan pointed at the lack of regulation surrounding short-term rental providers and e-hailing services. He urged the Malaysian government to impose stricter penalties for unlicensed operators and ‘rogue’ travel agencies that harm the industry and consumer trust.
Tan also criticised the restriction that prevents individuals from owning shares in multiple travel companies, describing it as an outdated and limiting policy.
“Instead of stifling growth, the tourism ministry should encourage mergers and collaborations among smaller agencies to help them compete in a challenging market,” says Tan.
He also called for better protection for local businesses, particularly addressing the policy that allows 100 pc foreign ownership of inbound travel agencies with a low capital requirement of just RM 1.5 million (USD 340,000).
“This policy puts local businesses at a disadvantage and creates an unfair playing field,” Tan said, urging a revision to prevent foreign players from easily entering the market and sidelining Malaysian entrepreneurs.
Tan also addressed concerns raised in Parliament, including the requirement for all tour buses to have a licensed guide, which he said burdened small operators. He suggested a more flexible approach, where businesses could determine what works best for their needs and safety considerations.
“The tourism sector is crucial to Malaysia’s economy, and the lack of action on this reform is a major disappointment. The government must act now to ensure that we don’t fall further behind in the global market,” he said.
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