Tourism Minister in Investment Plea as ‘Wonderful Indonesia’ Beckons

Jakarta Globe, Dec 11, 2014

Lounge chairs are placed along the shore of Gili Air Island, in East Nusa
Tenggara on Dec. 9, 2014. (Antara Photo/Widodo S. Jusuf)

Jakarta. Indonesia’s tourism minister called for more investment in everything from ports to dive operators on Thursday as he pushed for private and public funding to reach the ambitious goal of doubling the archipelago’s tourist visitors by 2019.

“We need investment, especially in hotel rooms,” Arief Yahya told an audience of tourism industry professionals at Indonesia Tourism Investment Day 2014.

Arief emphasized the need to boost the number of hotel rooms in parts of the country where occupancy rates are high, while official data show the need for some 15,000 restaurants as well as niche facilities including dive operators and big-ticket infrastructure items like ports.

“I have sent a letter of the list of 88 tourism regions in Indonesia to the transport minister and public works minister,” Arief said. “I think that investment in tourism is better than investments in manufacturing.”

Indonesia has underperformed as a tourist destination relative to its regional peers, despite having a preponderance of outstanding natural beauty and a currency that cycles between friendly and very friendly, relative to the currencies of its top five visitors; Singapore, Malaysia, Australia, China and Japan.

Indonesia took a leaf out of the Malaysian book in 2011 with the launch of the “Wonderful Indonesia” campaign, which replaced the dry “Visit Indonesia” promotion of previous years. Tourist arrivals jumped 9 percent in its first year.

Indonesia stamped 8.8 million tourist visas in 2013, a 10 percent increase on the previous year. But again too much of Indonesia’s tourism fortunes were tied up in Bali, which welcomed 3.27 million people last year — 826,000 of them from Australia.

Bali has much to offer, but it has had much of it for several years now. It has one of the world’s best restaurants, Mozaic, in the hilltown of Ubud, as well as an abundance of world-class beach resorts in the island’s south and a long list of attractions, from its Hindu temples to crowded surf breaks.

But much of the rest of the archipelago remains too far off the beaten path for most travelers — something the ministry will need to help address if Indonesia is to close the gap on the more than 25 million visitors neighboring Malaysia achieved in 2012.

Tourism industry professionals have long pointed to Indonesia’s unwelcoming visa system as a key barrier to opening up less frequented destinations.

Most tourists pay $35 on arrivals in the country and have the right to stay for 30 days. Renewing a tourist visa for an additional 30 days can be done inside the country, but the process can be lengthy and discourage people from staying longer and venturing out to areas of natural beauty such as Flores and Raja Ampat in the east, and Lake Toba and Sabang in the west.

Infrastructure remains a concern among hoteliers and tour operators. Lake Toba, for example, the site of the world’s largest volcanic eruption 25 million years ago and the world’s largest volcanic lake, is desperately short of foreign visitors — due in part to the five hours it takes to drive the 160 kilometers from the nearest airport in Medan.

Other parts of the country — from the dive resorts of Wakatobi and Derawan to national parks like Bromo in East Java — remain relatively difficult to reach, and visitors are less likely to explore multiple destinations because of Indonesia’s visa restrictions.

The combination of factors affecting Indonesia’s tourism potential has a negative impact on an important source of foreign currency — around the $10 billion mark in 2013. The sector is also a productive source of employment.

The International Labor Organization (ILO) has worked with the Ministry of Tourism in recent years to improve the way data are collected, as a means of boosting the quantity and quality of jobs in the sector. A recent document issued by the Geneva-based organization called for a focus on poverty reduction and the creation of sustainable jobs.

Realistic ambition?

Arief has set an ambitious target of 20 million foreign tourists by 2019, indicating a 127 percent increase in the next five years. By comparison, foreign arrivals rose 37 percent in the previous five years.

Tourism officials and industry executives have long credited Malaysia with running a gold-standard marketing campaign to attract more visitors. The “Malaysia, Truly Asia,” campaign launched in 1999 was responsible for boosting occupancy rates across the country’s beach resorts and inland hotels.

While Malaysia benefits from a capable road network and more efficient transportation, Indonesia has more noteworthy attractions across its sprawling archipelago.

But Arief’s target over the next five years will largely remain dependent on the currency outlook and attracting visitors from holiday-hungry China. Easing visa restrictions would help in bringing in more tourists to the country.