Kuala Lumpur, 10 February 2021– As Malaysia’s second major movement control order (MCO 2.0) saw its first extension until 18 February 2021, Think City released the findings from its business community pulse check survey.
Conducted in August 2020, just after the first MCO, the report uncovered findings highlighting the vulnerabilities of inner-city heritage areas in Malaysia. A total of 875 businesses in the downtown areas of Kuala Lumpur, Johor Bahru and George Town participated in the survey, to better understand market conditions, business sentiment and confidence levels.
At least 77 per cent of all businesses surveyed reported a decrease in sales and profit in the 12 months preceding August 2020 and the vast majority (at least 73 per cent) anticipated that their sales would be the same or would decrease in the year ahead.
Not surprisingly, downtown Johor Bahru businesses were the most affected due to their reliance on visitors from Singapore. Due to these losses, nearly a third of businesses reported a decline in the number of employees in the 12 months preceding August 2020, and at least 10 per cent expect reductions in the year ahead.
Despite the decline in business performance in the 12 months leading to August 2020, over 62 per cent of businesses were confident they would remain open at the end of 2021. At least 23 per cent of respondents did not know if they would remain open at the end of 2021, most likely due to the uncertainty COVID-19 has brought to the economy, especially to the tourism and hospitality sectors.
Interestingly, George Town businesses were more confident that they would be open in 12 months (74 per cent versus 64 and 62 for Kuala Lumpur and Johor Bahru respectively). This may be because the uptick in domestic tourism had seen many Malaysians travel to Penang to enjoy its heritage offerings.
Hamdan Abdul Majeed, Managing Director of Think City, said that the survey results show how vulnerable downtown heritage areas are to shocks, and that one of the main lessons learnt from the COVID-19 pandemic is that Malaysia needs to invest further in building resiliency within the urban communities.
“Many heritage areas in Malaysia are over-reliant on international tourism. While it is an important economic contributor, we need to invest into diversifying the cultural economy and ensuring there are authentic experiences for locals and visitors alike. We also need to offer a range of economic activities, housing and amenities so that people can live and work nearby,” he said.
– Construction+ Online
Source: Think City