By JAMES LEONG
SANDAKAN: The Sandakan Tourism Association (STAN) has called on the government to reconsider its decision to exclude tour buses and vans from the targeted diesel subsidy programme (SKDS), warning that the move threatens the survival of Sabah’s tourism industry.
Under the SKDS scheme set for implementation in July, local tour operators will not be eligible for diesel subsidies, a decision the Ministry of Finance justified on the grounds that subsidies should not benefit foreign tourists. STAN president Teo Chee Kim argued that this reasoning overlooks the fundamental reality of how the tourism business operates.
Teo explained that tour operators routinely accept forward bookings three to six months in advance, particularly from long-haul travellers in Europe, America, and Australia. He cited examples of European tourists who have already made reservations for 2027 trips to Selingan Turtle Island and Kinabatangan River cruises, all priced based on current cost structures.
He stressed that the government’s hasty implementation of the scheme without fully understanding the industry’s business cycle places local operators in an untenable position. STAN is not opposed to the subsidy rationalisation in principle, but Teo appealed for a grace period of three to six months to allow tour operators to adjust their rates and inform overseas agents accordingly.
Teo revealed that STAN has raised the matter with Sandakan Member of Parliament Vivian Wong, who agreed that the issue requires urgent attention from both the Ministry of Finance and the Ministry of Tourism, Arts and Culture.
He also pointed to external pressures already weighing on the sector, including a nearly 20% drop in overseas tourist arrivals since March due to the Middle East conflict, coupled with substantial flight cancellations.
The abrupt removal of subsidies, he warned, gives the industry no time to adapt and will further threaten its viability.
“The government is putting the local tourism industry on the edge with this hasty implementation,” Teo concluded, urging policymakers to engage in deeper deliberation before proceeding.
Teo argued that this reasoning overlooks the fundamental reality of how the tourism business operates.
