Fadli, Batam, Riau Islands – Tourism Minister Arief Yahya has called on Transportation Minister Budki Karya Sumadi to issue a regulation that would require airlines to lower their prices for economic-class tickets to help boost the tourism industry.
"We hope that the transportation minister will issue a regulation to push airfares down and take effect this week," Arief said on Wednesday.
Arief referred to a statement made by Budi, who said he would issue a ministerial decree requiring airlines to allocate only 20 percent of tickets for full services, 20 percent for subclass services with ticket prices 70 percent of the maximum prices.
Budi said such a new decree would be needed if airlines failed to significantly slash ticket prices after the issuance of two regulations, namely Transportation Ministerial Regulation No. 20/2019 on airfares for domestic commercial airlines and Ministerial Decree No. 72/2019 on maximum airfare.
"Airlines play a large role in boosting both domestic and foreign tourist arrivals, particularly for island destinations like Batam, Bintan, Lombok and Labuhan Bajo," Arief said, adding that the airlines had passed the one-week deadline that was given to them.
According to the Indonesia Tour and Travel Agency Association (ASITA), airfares increased up to 100 percent in December 2018. After the two regulations were issued late last month, several airlines had cut their prices, but many other airlines had failed to take action.
Arief said many destinations had been affected by the recent increase of domestic airfares because those destinations relied very much on tourists arriving on airplanes.
"Tourism-related businesses hope that the airfares will go back to normal. A small increase is okay, but it should not be done suddenly; it has shocked a lot of people," he said on the sideline of the Visit Indonesia Tourism Organization (VITO) Annual Meeting in Batam.
Meanwhile, ASITA chairman Andika Lim expressed his concerns over the fact that the new government regulations had failed to decrease ticket prices.
Because of the high prices, he said many Indonesians preferred to travel abroad through Malaysia or Singapore, instead of traveling to Batam and Bintan in Riau Islands province and Karimun Java in Central Java.
"Indonesians prefer to travel abroad through Singapore and Malaysia because of the high ticket prices [in Indonesia]. It is counterproductive to the efforts of the Tourism Ministry to boost the country's tourism," Lim said.
Since airlines increased their airfares last year, arrivals at the Hang Nadim Airport in Batam has decreased significantly. In January 2018, the number of arrivals at the airport was recorded at 504,556, but by January 2019, the figure had dropped to 389,492.
Meanwhile, arrivals in February 2018 was recorded at 453,033 and in February 2019, the number decreased to only 314,474.
"The decrease was caused by high airplane ticket prices and the change in the free baggage policy of each airline," Lim added. (bbn)