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Indonesia adjusts foreign tourist targets over global recession risk

Jakarta Post - January 13, 2023

Deni Ghifari, Jakarta – Tourism and Creative Economy Minister Sandiaga Uno has said the ministry will adjust the country's foreign tourism strategy in response to a heightened risk of recession in developed economies this year.

Such recessions could affect several major sources of Indonesian tourism, namely the United States, China and Europe, Sandiaga said on Monday in a weekly press briefing.

"[A recession would] of course affect people's expenditures, especially on tourism. Therefore, we have decided to adapt in terms of tourism and creative economy development focus, specifically regarding foreign tourists," said Sandiaga.

The new strategy seeks to boost tourist visits from the countries that accounted for the majority of arrivals in 2022, which include India, Australia, New Zealand, Malaysia and Singapore.

Ministry data shows that there were 4.58 million foreign tourist visits to the country from January to November 2022, a 228.30 percent increase from the same period the year before.

By nation, Malaysia topped the list with 876,475 visits, followed by Timor Leste with 628,471, Australia with 552,216, Singapore with 486,295 and India with 218,417.

In terms of year-on-year percent growth, however, Australia led with 20.9 percent, far above runner-up New Zealand with 9.1 percent. Next were India with 3.8 percent visitor growth, Germany with 3.6 percent and France with 3.6 percent.

Indonesian Tour and Travel Agency Association (ASITA) vice chairman Budijanto Ardiansjah said the adjustment of focus was justified but that the government should not forget about legacy sources of visitors, such as China and the US.

"Target market readjustment is an inevitability since tourism is dependent on several factors, such as the economy, politics and security," Budijanto said on Tuesday.

"So, ideally, this kind of readjustment, based on each market's development and potential, needs to be done every year to ensure the promotion and policies are right," he added.

However, Budijanto cast doubt on the figure from Timor Leste, which has either been at the top or second only to Malaysia in the past three years, given that the country had an enclave in the western part of the island called the Oecusse region that was often accessed by a land route through Indonesian territory.

"These cross-border travelers are essentially not tourists but just border crossers that can do this every day or every week," said Budijanto.

Bank Mandiri analyst Haris Eko Faruddin said the figures were not all that different from before, except for the decline in visitors from locked down China, which brought other countries' visitor proportions up.

According to Statistics Indonesia (BPS) data, Chinese tourist visits were second only to Malaysia before the pandemic, accounting for 12.9 percent of all tourist arrivals in 2019. However, as a result of the country's strict COVID-19 lockdowns, China has accounted for less than 4 percent of tourist arrivals for the past two years.

"[Tourism can keep growing this year] especially thanks to the revocation of public activity restrictions [PPKM] and the ever-present potential of domestic tourists," said Haris on Tuesday.

To push domestic tourism further, Haris suggested that the government hold new and creative tourism events. He said industry players should keep up the quality of services so that well-off consumers were willing to spend on domestic vacations.

"Industry players can offer cheaper [travel] tickets or they can bundle hotel reservations with airplane tickets or with tourist attractions," he added.

Sandiaga noted that Qatar and Dubai had expressed interest in establishing direct flights to Indonesia and that the government was setting up more flights from India, Singapore and other Southeast Asian countries.

"We are working hard [to add more direct flights] in this year's first quarter by collaborating with airlines and the Transportation Ministry," the minister added.

Source: https://asianews.network/indonesia-adjusts-foreign-tourist-targets-over-global-recession-risk