The government will likely need to review its strategy in promoting its priority tourist destinations, as data shows that recent tourism investment mainly headed to just two popular regions.
During the first six months of this year, the country has seen investment worth US$858.7 million coming into the tourist sector. The tourism Ministry’s deputy for destination and tourism industry development Dadang Rizki Ratman, however, said most of the investment only went to Jakarta and Bali, the country’s two main international gateways.
“This is our challenge — to encourage investors to invest outside those two places,” he said recently.
Dadang highlighted the importance of infrastructure development and upgrades in many other tourist destinations as it would become a key factor to attract investors to put their money to the industry.
The government is targeting the arrival of 20 million foreign tourists in 2019. This year, 12 million foreign tourist arrivals has been targeted, with almost half achieved in the first semester.
To level out the popularity of other places with that of Bali, the country’s most popular resort island, the government has selected 10 destinations to develop to 2019.
They include Lake Toba in North Sumatra, Mount Bromo in East Java, Mandalika resort area in West Nusa Tenggara, Labuan Bajo in East Nusa Tenggara, Wakatobi in Southeast Sulawesi, Cape Kelayang in Bangka Belitung, Cape Lesung in Banten and Morotai in Maluku.
Dadang said infrastructure, such as roads, airports and power plants were in the works to support tourism activities and attract more investors. The Kualanamu-Tebing Tinggi toll road, for example, was in progress and scheduled for completion next year. The road would give more access to Lake Toba, the world’s largest volcanic lake.
Besides accessibility, intensive promotion was also necessary, said Babar Suharso, the head of regional Investment Coordinating Board (BKPMD) of Banten province.
“People can access Cape Lesung wthin only three hours but we still haven’t got any investors so we’ve asked Kadin [Indonesia Chamber of Commerce and Industry] to introduce us to their network,” he said.
BKPMD Banten said a number of South Korean investors had expressed their interests to invest in the location, but none have further approached the regional administration. Investors from Kuwait will visit the cape in November for a potential deal, Babar said.
Meanwhile, Indonesian Tour and Travel Agencies Association (Asita) chairman Asnawi Bahar emphasized accessibility as an important point to attract more investors.
“It is understandable that investment is still concentrated in Bali and Jakarta because the two have international airports with many international routes. One thing for sure to attract more investors is accessibility,” Asnawi told The Jakarta Post over the phone.
Recently, the government announced a $300 million loan from the World Bank to expedite infrastructure development in and around Borobudur Temple, Mandalika and Lake Toba.
Nevertheless, the natural beauty of sites in Indonesia has inevitably swayed a group of businesspeople in Perth, Australia to invest in Manado, North Sulawesi, whose Bunaken island is famous for its diving spots.
“[The investment plan in] Manado is a very large ambition. It is a big tourism area so this group of companies running different businesses plan to turn it into a new destination,” said Debnath Guharoy, president of Australian Indonesian Business Council (AIBC) said via phone.
The group will present its detailed plan to North Sulawesi administration in the next few weeks. They are planning to build hotels, power plants and a waste management system, as well as a conservation area for Bunaken underwater park.
Indonesia boasts 17,000 islands blessed with beautiful coastline and inland potential, plus a big market of more than 259 million people. To propel its tourism industry, the country has also offered free visas to 169 countries and simplified yacht and cruise arrival rules.