KOTA KINABALU: Sabah’s tourism industry has appealed to the Federal Government to recognise tourism transportation as an essential sector eligible for diesel subsidies under the Subsidised Diesel Control System (SKDS), warning that rising fuel costs could significantly impact tourism businesses and weaken Sabah’s competitiveness as a travel destination.
The call was made jointly by the Sabah Tourism Federation (STF), Sabah Tourist Association (STA), Sabah Enhanced Travel Innovation Association (Setia), and Sabah Association of Tour and Travel Agents (Satta). Industry leaders expressed concern over the scheduled increase in diesel prices from RM2.15 to RM4.37 per litre beginning in July, saying the move would place additional financial pressure on tourism transport operators, many of whom are still recovering from the effects of the Covid-19 pandemic.
In a joint statement, STF President Tonny Chew, STA Chairwoman Melanie Chu, Setia Chairwoman Christina Wahida Kong, and Satta Chairman Justin Chong said tourism transportation providers, including tour buses, vans and boat operators, remain excluded from the SKDS despite playing a crucial role in facilitating visitor movement across Sabah.
They noted that many bookings for the upcoming peak travel periods, including the July-August season and year-end school holidays, were secured based on previous fuel costs, leaving operators unable to pass on the additional expenses to customers.
The associations stressed that Sabah faces unique challenges compared to Peninsular Malaysia, where public transportation networks such as MRT, LRT and KTM services provide alternative travel options. In Sabah, tourism depends heavily on road transport and air arrivals, while higher vehicle maintenance costs and logistical challenges further increase operational expenses.
As a result, the industry warned that higher fuel prices could lead to increased tour package costs, reduced competitiveness against regional destinations such as Thailand, Indonesia and Vietnam, business closures, job losses and a decline in visitor experience.
The tourism bodies have urged the Ministry of Domestic Trade and Cost of Living (KPDN) to extend targeted diesel subsidies to licensed tourism vehicles or introduce alternative support measures, including a temporary postponement of the diesel price adjustment or a partial subsidy mechanism. They also called on Tourism, Arts and Culture Minister Tiong King Sing and Sabah Tourism, Culture and Environment Minister Jafry Ariffin to support the industry as Malaysia advances through Visit Malaysia Year 2026 and prepares for Visit Sabah Year 2027.
Industry leaders emphasised that tourism remains a key contributor to the economy and supports thousands of livelihoods across the country. They said timely intervention would help safeguard tourism operators, maintain destination competitiveness and ensure Sabah remains attractive to both domestic and international visitors.
