Sabah tourism braces for US-Iran conflict impact

KOTA KINABALU (March 17): Tourism industry leader Datuk Dr Tan Kok Liang warned that the ongoing conflict between the United States and Iran will inevitably disrupt global and domestic travel patterns, specifically threatening Sabah’s tourism sector.

He noted that rising geopolitical tensions typically drive up global oil prices, which directly translates into higher jet fuel costs and more expensive airfares.

Stressing that it is “no longer business as usual,” Dr Tan urged stakeholders to act immediately before escalating costs significantly alter traveler behavior.

He called for the implementation of proactive policies to strengthen domestic and regional travel resilience, highlighting that a critical step to softening the impact is ensuring that airfares between Peninsular Malaysia and Sabah remain affordable year-round.

Dr Tan also The emphasised that Sabah’s industry, while diversified, remains vulnerable to global shocks.

Currently, he said domestic arrivals make up 60% of visitors, followed by China (18%), ASEAN (11%), South Korea (5%), and the UK/Europe (3%).

“If the conflict persists into late 2026, the resulting spike in fuel prices could weaken demand and increase operational costs for local operators…a rising cost of living may discourage Malaysians from traveling domestically, compounding the challenges faced by the state.

Dr Tan also critiqued current government measures, stating that the Ministry of Transport’s decision to cap airfares only during festive seasons is insufficient.

Given that 90% of arrivals into Sabah are by air, he argued that affordable connectivity must be treated as a consistent national economic priority rather than a seasonal fix.

The tourism professional maintained that maintaining price stability throughout the year is essential to shielding Sabah’s economy from the volatility of international conflicts.