Myanmar tourism prepares to cut 50% of staff amid COVID-19 slump

YANGON – The Union of Myanmar Tourism Associations (UMTA) predicts that more than half of those working in the hospitality and tourism industry may lose their jobs due to COVID-19.

UMTA chairman U Naung Naung Han told The Irrawaddy that many hotels and travel agencies laid off 50% to 70% of their staff as all hotels and travel agencies were forced to suspend operations, while others reduced wages.

“Some companies have downsized because of survival. But others, with 10 or so employees, can’t downsize further. So they’ve reduced wages,” he said.

UMTA estimates that about 800,000 people are directly employed in the hospitality industry, and if indirect employment in tourism-related services such as horse-drawn carriages, motor boats and weaving is included, the total could be between 1.2 million and 1.5 million.

“At the same time, those who can’t hold on will have to leave their businesses. I’m afraid things will get worse in May and June,” U Naung Naung Han said.

The rainy season usually starts in mid-May and lasts until October, making it the low season in Myanmar. U Naung Naung Han expects more than 500,000 job losses in the hotel industry.

“In March, most (travel agencies and hoteliers) paid 70% to 100% of their salaries to their employees. In April, some paid only 20% to 50%. Things could get worse in May, said U Khin Aung Tun, vice-chairman of UMTA.

The global impact of COVID-19 could mean that tourism in Myanmar is unlikely to return to normal until 2023, even if the spread of the coronavirus domestically is contained, according to travel agencies.

Travel agents predict that economic turmoil in Europe will mean that tourist numbers will continue to decline for several years.

“As health and food will be prioritized, I am sure group tourism will be significantly reduced,” U Khin Aung Tun said.

Even if COVID-19 is quickly brought under control in Myanmar, it will take six months for 10 percent of the tourism industry to reopen, UMTA predicts. It will take at least nine months for the entire department to resume operations.

U Myo Min Oo, president of Bagan Myanmar Tours, told The Irrawaddy: “To emerge from this crisis, we are providing capacity-building training to our staff and redesigning our tour packages to improve our services.”

He said his company has neither laid off workers nor cut wages so far.

“The government is doing what it can to help businesses recover. But it has a lot to do. So we are preparing ourselves by envisioning how things will play out,” he added.

In March, the government established a 100 billion kyat ($70 million) fund to provide loans to businesses hit hard by COVID-19.

The bank said it would extend loans to the most vulnerable factories, including garment makers, hotel and tourism businesses, and domestic small and medium-sized enterprises. So far, it has provided loans to more than 200 businesses at an interest rate of 1 percentage point.

However, some travel companies refused to accept the loan because they could not get the requested amount and were only given a much smaller amount.

In 2019, a total of 4 million tourists from more than 30 countries visited Myanmar.

Thet Ko Ko Translated from Burmese

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