Charge hotel room rate in US dollar to reduce price competition

KUALA LUMPUR: The proposal for hotel room rates in Malaysia to be charged in the United States currency will be able to reduce price competition between budget hotels and four and five-star hotels.

Malaysian Budget & Business Hotel Association (MyBHA) ) president Dr Sri Ganesh Michiel said the proposal would also indirectly enhance the country’s hotel industry in the eyes of foreign tourists.

"We, as budget hotel operators agree with the statement by the Malaysian Hotel Association (MAH) because it will automatically reduce the 'price war' between budget hotels and four and five star hotels.

"Right now we have to compete with these hotels because the price is more or less the same. We cannot increase the price because if it is increased, tourists will prefer to stay in those hotels," he told Bernama.

Ganesh was commenting on MAH secretary -general Datuk Megat Shahrul Azman Abas's statement on the association's intention to charge room rates in USD like other countries in the region as reported by the media yesterday.

To realise it, Ganesh suggested the government to implement a two-price system approach for hotel accommodation to differentiate the payment rate between Malaysians and foreign tourists.

Ganesh said the mechanism, if implemented, would help the country's hotel sector to remain competitive with regional countries, as well as help generate income for them.

"The government should take the initiative to resolve the threats facing the hotel industry, such as formulating a law to regulate online travel agencies (OTA) and enforce the Short Term Residential Accommodation (STRA) guidelines to ensure the survival of the hotel industry," he said.

Among the things that the government should do, he said, was to create a mechanism or a system such as an online travel portal that is special for Malaysians only for matters such as hotel reservation at special rates.

"When we have our own portals that are regulated by the government and the law, we can get more accurate statistics compared to relying on foreign portals," he added.

Ganesh said similar mechanism had been used by foreign countries, like China, which created two different travel portals for domestic tourists and foreign tourists.

"In China, there is the Ctrip which can only be used by their people. For foreign tourists, they have to use Trip.com. The price between these two portals is very different," he said.

Meanwhile, Malaysian Hotel Owners Association (MAHO) executive director Shaharuddin M. Saaid said the proposal by MAH would increase confidence of foreign tourists towards the hotel industry in Malaysia, as well as increase the income of the hotel operators.

"The price of hotel rooms in Malaysia for four and five star hotels in Ringgit Malaysia (RM) is too low if converted to USD. For the same class hotel rooms in New York or Singapore, the price is at least USD400. In Malaysia, it is less than USD100. It does not reflect the status of a five -star hotel.

"So we have to adjust the price so that it reflects that price of a five-star hotel and on par with five-star hotels abroad," he said.

Shaharuddin said the increased in income for hotel operators would also benefit hotel workers and this would indirectly help to improve the quality of their service.

"If we can get a higher income, we will be able to offer better salary to employees and also provide the necessary training to improve the quality of services," he said.

Homestay operator, Mastura Malak, 32 shared a similar opinion on the proposal by MAH, saying that it would attract more foreign tourists, but expressed the hope that hotel operators would not take advantage by raising the price, including for local tourists.

"With the uncertain economy, it would be better if the current price is maintained. There is no need to raise the price suddenly," said the woman who runs homestays in Temerloh and Desaru.

-- BERNAMA