President Joko Widodo (Raja Ampat Island) - Photo by President Office

JAKARTA (TheInsiderStories) – As an archipelagic country, Indonesia is the home of natural scenic beauty, harboring tropical beaches and rain forests, in addition to cultural richness. However, the fact is that only a relatively few foreign tourists are aware of Indonesia. Moreover, they are likely more familiar with ‘Bali’ than ‘Indonesia’ itself.

Indonesia has long depended on its natural resources – coal, copper, oil & and gas – as a source of foreign exchange. Lately, however, the Indonesian government, led by President Joko Widodo, has decided to actively promote the development of tourism as a future revenue stream. The tourism sector can potentially manifest a comparative advantage, as it requires less investment and thus imposes less stress on a limited state budget.

The first step is to appoint a Tourism Minister from professional circles. ‘Jokowi’ as he is nicknamed, appointed Arief Yahya – the former President Director of PT Telekomunikasi Indonesia Tbk – a Bayuwangi-born executive with experience in marketing, and he has been instructed to promote Indonesia as a tourist destination to the world at large as well as changing the old-fashioned bureaucratic culture of his Ministry to embrace a modern corporate style.

Widodo set Yahya a target: to boost the number of foreign tourists visiting Indonesia until 2019. In 2015, there were 10 million arrivals, increasing to 12 million (2016), 15 million (2017), projecting 18 million (2018), and 20 million (2019). Therefore, the tourism sector will contribute at least 8 percent or Rp240 trillion (US$17.8 billion) to gross domestic product (GDP) in 2019, as well as creating more than 13 million jobs for Indonesians. In 2015, the tourism sector created 11.3 million jobs and contributed 4 percent to GDP.

The number of foreign tourist arrivals to Indonesia actually still lags behind its ASEAN region neighbors. 2011 figures showed that only 7.6 million foreign visitors came to Indonesia, while Malaysia had 24.7 million, Thailand 19.2 million, and Singapore 13.1 million. By 2015, Indonesia counted 10 million foreign arrivals while Malaysia had 29.2 million, Thailand had 29.7 million, and Singapore had 16.1 million.

’Our tourism sector has huge potential. But foreign tourist numbers still lag behind Malaysia and Thailand. As an example of our attractions we have Pulau Bintan in the Riau Islands – much more attractive and with more amenities than Phuket in Thailand or Langkawi Island in Malaysia,’ said Arief recently.

The government has set 10 tourism destinations beyond Bali to help meet the targeted number of foreign tourists, namely, Lake Toba (North Sumatra), Kepulauan Seribu and Kota Tua (Jakarta), Borobudur (Central Java), Labuan Bajo (East Nusa Tenggara), Bromo-Tengger-Mt. Semeru (East Java), Wakatobi (Southeast Sulawesi) and four tourism special economic zones: Tanjung Lesung (Banten), Morotai (North Maluku), Tanjung Kelayang (Bangka Belitung), and Mandalika (West Nusa Tenggara).

However, they have to ‘do their homework’ to develop any ‘New Bali’: first comes the basic infrastructure. Thus the first move of the government is to set an authority or agency in every destination. Unlike Bali, which already has decent infrastructure, most places in Indonesia, especially outside Java, are afflicted with poor infrastructure. Around Lake Toba, for instance, the government needs to upgrade modes of transportation to facilitate tourist movement. State-owned airport operator Angkasa Pura II has renovated Silangit airport to become an international terminal and expects to serve foreign tourists in October 2017, while the government concentrates on resolving other transportation issues, such as buses and railways.

‘We encourage state-owned hotels and accommodation such as Ina and Patra Jasa to build hotels around Lake Toba because there are currently only 710 rooms available. This is not enough,’ Luhut Pandjaitan, Coordinating Minister for Maritime Affairs, said.

In addition, Widodo administration is also relaxed free-visa policy to lure of 1 million of the foreign tourist number. Currently, Indonesia has applied the free-visa policy to 169 countries. The government is also relaxed the regulation to boost cruise or yacht visit to Indonesia through removing of clearance approval for Indonesia territory and allowing them to lean in five major ports in Indonesia namely Belawan (Medan), Tanjung Priok (Jakarta), Tanjung Perak (Surabaya), Benoa (Bali), and Soekarno-Hatta (Makassar).

The government effort to develop tourism has begun to bear fruit. Foreign tourist number targets for the last two years were satisfactorily achieved. In the first seven months of this year, foreign tourist numbers reached 7.81 million, or 31 percent higher compared to the same period last year, while the average foreign tourist growth in ASEAN countries (or globally) only marked a single digit.

Foreign direct investment (FDI) in the tourism sector is also increasing every year. In 2014, tourism FDI reached $673.1 million, rising to $732.5 million in 2015. In 2016, it continued to rise, in line with the government’s plan to develop the special economic zones for tourism: Tanjung Lesung, Morotai, Tanjung Kelayang and Mandalika. The last-mentioned place drew attention to two big companies – Roadgrip Motorsports UK Ltd and MRK1 Consulting – as they plan to build a world-class street race circuit.

‘Our next strategy will likely be more digital. We will use social media, big data, and e-commerce, because digital technology is important to get closer to consumers,’ he added.

From the marketing side, the government strengthened ‘Wonderful Indonesia’ as a national tourism promotional campaign. Recent partnerships have been forged with 28 premium local brands, ranging from hotels to on-line travel applications. Previously, the partnership also signed up with international brands such as AirAsia and Adobe to utilized outdoor media. The government is also promoting ‘Wonderful Indonesia’ in London taxis and on Paris tour buses to introduce Indonesia to the international community.

The government is aligned with a ‘three A’ slogan that consists of Access, Attractions and Amenities for local people as well as local governments, as part of tourist destination development in line with global standards. Indonesia has rich attractions but insufficient access and amenities. Local people are also expected not only to keep their locales beautiful and interesting but also to be friendly to both local and foreign tourists.

Writing by Rahmat Fiansyah, Email: rahmat.fiansyah@theinsiderstories.com

 

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