Hotels hold on despite global financial crisis

Andra Wisnu, The Jakarta Post, Denpasar | Fri, 12/26/2008 11:21 AM  

Hotels in Bali are yet to experience any significant downturn in occupancy or room-booking rates, as the island's tourism leaders watch nervously for signs the global financial crisis is starting to hit the industry. 

Several hotels in Bali have reported only slightly lower occupancy and booking rates than last year, with the drops attributed to the global crisis and the Australian government's travel warning. 

Meutia Mahardhika, public relations manager of the Bali Hyatt in Sanur, said the hotel's occupancy rate was at about 50 to 60 percent in the first few weeks of December, similar to that experienced in the same period last year. 

She said the Hyatt had not noticed any significant reduction in booking rates for New Year celebrations, as it was already about 80 percent booked until early January. 

"So far we're still doing well, but we are worried about the financial crisis because our base market is Europeans, who might feel less inclined to travel all the way to Bali for their holidays and could opt for closer destinations instead," she said. 

Ani, a reservations officer at the Mercure Hotel in Sanur, reported a downturn of about 10 percent in bookings over the December-January period, to an average occupancy rate of 70 percent this year from 80 percent last year. 

Nevertheless, the hotel is about 90 percent booked for the end of December. 

"So I can say that we're still getting guests despite the financial crisis," she said. 

In Kuta's Seminyak and Legian areas, hotels are experiencing less than encouraging numbers. 

Sukaesih Winjarini, Sales Manager of Oberoi Hotel, said bookings had been slow in December, with occupancy averaging about 60 percent. 

Bali hotels tend to experience 70 to 90 percent occupancy during December to January, a period known as the local tourism industry's traditional peak season. 

"In our case, we've just been having a slow month, whether it's because of the financial crisis or something else," she said. 

With the numbers heading south, Robin Deb, manager of an Accor operated hotel chain, warned another problem for Bali's tourism industry could be coming from the south too -- the Australian government's travel warning issued last month concerning the recent execution of the three Bali bombers. 

"I can say that, at least for Accor hotels in the Seminyak and Legian areas, cancellations have come mainly from Australian tourists, which I suspect is due to the travel warning," he said. 

Head of the Bali Tourism Board, Ngurah Wijaya, confirmed that Bali had experienced lower occupancy rates in the first couple of weeks of December, a sign that tourists were waiting for the financial crisis to subside before going on holidays. 

"Booking rates may remain the same or only slightly lower, but that's still not a telltale sign of what's going to happen in the days to come except that it will not be as high as last year," he said. 

"The deciding point will arrive in January and February, and I hope we'll continue to have guests." 

He urged hotels and tour operators against engaging in price wars, as witnessed after the first Bali bombing in 2002, which nearly destroyed the island's tourism industry. 

"Businesses in the tourism industry must work together by helping each other in promoting the island because it will be in the island's best interests to survive as a whole," he said.