KUALA LUMPUR: Malaysian businesses and umrah agencies have adopted a cautious approach to their operations in the Middle East amid security concerns following a deadly attack on King Khalid International Airport in Riyadh last week.
The Malaysia External Trade Development Corporation (Matrade) said Malaysian companies in the retail and consumer sectors in the region had adopted measures to adapt to the current situation.
"Based on the latest updates from our Trade Office in Jeddah, Malaysian businesses in the retail and consumer sectors remain cautious and have adopted measures to adapt to the current situation.
"Increased logistics insurance premiums, fewer tourists and pilgrims, volatile flight schedules and shifts in consumer spending could affect their businesses," it said in a reply to Business Times.
Citing the latest statistics from Saudi Arabia's General Authority for Statistics as at Dec 31, 2024, Matrade said Malaysia's foreign direct investment in the kingdom stood at SAR2.86 billion (US$760 million).
By value, most Malaysian businesses in Saudi Arabia operate in industrial products and services, including precast and building materials, construction services, facilities management and utilities.
"Nevertheless, it would be premature to draw conclusions at this stage. However, a prolonged escalation could pose challenges to trade, particularly in logistics, shipping routes, delivery timelines and associated costs.
"We will continue to monitor the situation and gather feedback from the business community. Recovery in these sectors will depend on the swift mitigation and resolution of regional geopolitical tensions," Matrade said.
A Houthi strike hit Riyadh's international airport on Oct 12, a day after an attack claimed by the Yemeni group killed at least a dozen people and forced authorities to suspend operations there.
The previous day's attack was reported to be the deadliest on Saudi soil in more than a decade and marked a sharp escalation in the Yemen war.
Following the attacks, the Malaysian government advised a temporary halt to travel to Saudi Arabia for umrah due to security concerns.
Foreign Minister Datuk Seri Mohamad Hasan was previously quoted as saying that the missile attack in Riyadh had prompted the government to advise Malaysians to defer non-essential travel to Makkah and Madinah for the time being.
Meanwhile, Pertubuhan Agensi Umrah dan Haji Sarawak (Suha) chairman Ruzaiman Ghazalee said some airlines had cancelled umrah flights before the Riyadh airport attack, prompting several umrah agencies in Sarawak to switch to other airlines.
"However, so far, Malaysia Airlines, Saudia, AirAsia and other airlines have continued operating their flights. In general, most umrah packages are still proceeding as planned, although a few agencies have postponed their trips," he said.
Following the attack, some Suha member agencies received requests to postpone umrah trips, including departures scheduled for December, mainly due to safety concerns, he added.
He said the situation had heightened customers' concerns and made travel planning more challenging.
"For umrah trips, last-minute changes are not easy, as flights, hotels and other arrangements are usually booked in advance.
"Agencies also have to consider additional costs and other practical issues.
"Overall, the Middle East conflict has had some impact on the umrah industry in Sarawak and Malaysia. For now, our main priority remains the safety and welfare of pilgrims," Ruzaiman added.
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