KUALA LUMPUR, 22 February 2021 – Despite the announcement of the reopening of several economic sectors including non-essential services like spas, gyms, casinos, and recreational fishing, cinemas across Malaysia are still forced to remain closed throughout the Movement Control Order (MCO), which is now expected to continue until 4th March 2021. In other neighbouring and developed countries such as Singapore, Thailand, Indonesia, Korea, and Japan, cinemas have been permitted to operate. India, which has just reopened its cinemas today, has also done so at 100% capacity.

The forced closure of movie theatres is crippling the Malaysian cinema industry, which has already lost up to 90% of revenue year-on-year and more than RM500 million in total losses incurred in the year 2020 alone. It is a stark contrast compared with previous years, where the industry has collectively contributed over RM1.08 billion in income and over RM250 million in entertainment tax duties to the country.

Long-term closures, long-term effects

With the continued closures, Malaysian cinemas will have been partially or fully closed for nearly a year since the first MCO in March 2020. These forced shutdowns have gravely impacted the industry, resulting in countless job losses, permanent closures of cinema locations, and a significant downsizing of operations for all exhibitors across the board. In some instances, cinema employees have even received extensive pay cuts of up to 70%. By far, the biggest loss, however, has been the exit of the country’s third largest exhibitor, MBO Cinemas, which has been forced into voluntary liquidation. In totality, over 25% of cinema screens all over the country have been permanently shuttered due to the long-term closures.

This is no longer just a crisis for the cinema industry; it is evolving into a financial catastrophe that is likely to affect thousands of jobs across a larger supply chain, which serves the entire trade from end- to-end       including  smaller organisations in  manufacturing, logistics, cleaning, F&B, and retail, among others. The collapse of the cinema industry is also estimated to directly impact the livelihoods of the larger local       Malay film industry,         where over 20,000 Malaysians are currently employed in filmmaking and production, creatives, distribution, talent, and much more.

“As a local filmmaker, we have been adversely affected by the COVID-19 pandemic, which has staggered the productions of three films including Abang Long Fadil 3, Polis Evo 3, and Mat Kilau, in which we have already invested more than RM20 million to produce. Furthermore, strict SOPs enforced on the creative industry have also further impacted all artists and performers involved.

The Government must address this situation before it gets worse. The losses incurred by cinema operators since the implementation of the first MCO in 2020 until today must also be taken into account. The paralysis of the cinema industry is not impossible, but should it happen, it would be difficult to recover,” said Datuk Dr. Yusof Haslam, Skop Productions.

MAFE has made several concerted appeals for assistance to the Government via Majlis Keselamatan Negara (MKN), Kementerian Kewangan Malaysia (MOF) and the Malaysian Communications and Multimedia Commission (MCMC). Chiefly among the requests made are for an exemption or reduction of entertainment taxes for exhibitors.

Although RM225 million was allocated to fund and support the arts, culture, and entertainment in June 2020, this allocation did not include cinemas. The 2021 Budget tabled in November later allocated RM100 million as a booster for the creative industry, but cinemas were once again exempted from this aid. To date, cinema operators have not yet obtained any other form of financial or stimulus packages from the total RM325 million that has been set aside for the creative industry by the Government.

“Given the allowances for certain non-essential industries to reopen over the last few weeks, we believe consumers are beginning to see the discrepancy in which businesses can reopen and which cannot. The cinema industry cannot sustain closure for much longer and it will undoubtedly collapse, affecting the livelihoods of every Malaysian serving across the entire supply chain. We hope that the Government will seriously reconsider their decision to allow us to reopen,” said General (Rtd) Tan Sri Datuk Amar (Dr) Mohd Ghazali Dato’ Mohd Seth, Chairman of MAFE.

Cinemas are the safest form of out-of-home entertainment

Since the beginning of the pandemic, cinema operators have followed an established set of stringent SOP guidelines from authorities, which includes mandatory contact tracing, temperature checks, and social distancing. Additionally, exhibitors have invested into thorough and frequent sanitation after every show, personal protective equipment (PPE) for staff, as well as the provisions of alcohol hand rubs for customers. Even while cinemas are closed, operators also continue daily maintenance of seats and equipment; expenditures that are becoming too overwhelming to bear without income.

Despite its best efforts, movie theatres have not been allowed to operate, although  no  COVID-19  clusters  have  ever  been  discovered  to  have originated from  the  cinema. This  is  further supported  by a  study conducted by Celluloid Junkie in October 2020, where it was reported that no COVID-19 clusters have ever been traced back to cinemas on the global level as well.

With no mingling allowed in halls and the application of gap seating, each hall’s capacity has been effectively reduced to less than 50%, enabling little to no physical contact amongst patrons. MAFE thus seeks an allowance from authorities to let families from the same household sit together side-by-side, with a single seat gap between every two seats, which is currently in practice by cinemas in Singapore where infections remain low. This is also in line with the recent relaxation of SOPs for dining, which does not enforce a limit on the number of people if they are seated 1-metre apart from each other.

More than just an entertainment hub, cinemas also play an important role in the cultural development of the nation. In times of distress, it provides the audiences an affordable and safe venue for escapism, as with other leisurely activities like casinos, spas, group exercises at gyms, and individual sports such as golf. With movie-goers following the SOPs and the little contact they have with other patrons, movie-going is no doubt one of the safest out-of-home entertainment places to be.

We strongly urge the Malaysian Government to reconsider the opening of cinemas.

From the Malaysian Association of Film Exhibitors #ReopenCinemas #BringCinemasBack