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 Tourism Development in Indonesia

   Indonesia is located on over 13,000 islands and has over 17 percent of the earth’s species. Roughly and conservatively, Indonesia houses about 11 percent of flowering plant species, 12 percent of the world’s mammals, 17 percent of all birds, and at least 37 percent the world’s fish.

   Since its independence, the government of Indonesia has exploited the natural resources of country to fuel “development”. Minerals and oil are heavily extracted; forest have been cleared and cut down. The development—which emphasizes very much on economic growth—has neglected almost all aspects other than economic growth. Until the late 1980s, the focus of the development had been on import substitution, and after that on developing export oriented industries. Hence, development in Indonesia means nothing more than industrialization. Moreover, industrialization in Indonesia has been focused on manufacturing.

   As stated in its long-term plan of development, Indonesia started its development by boosting the agriculture to be self-sufficient in food, and at the same time, establishing the foundations for industrialization. After completing the phase of developing its secondary (manufacturing) industry, the country moved forward to tertiary (service) industry. Relying on this concept on the early 1990s, Indonesia promoted the development of service industries. The most prominent sector in this industry is tourism.

   Tourism has played an important role in some provinces in Indonesia. The province of Bali, for example, enjoyed revenues from tourism even before the Government of Indonesia gave its attention to this sector. In order to promote the tourism industry, the president established a Ministry of Tourism, Post and Telecommunication in 1988, and set a “Visit Indonesia Year 1990” program.

NATIONAL POLICY ON TOURISM

   National policy on development of tourism is based on a long-term plan of development. During the last 32 years, a centralized development policy, including the tourism, was adopted. As a result, many provinces of Indonesia were not optimally and equally developed. The growth of tourism had been lower than that of neighboring countries in ASEAN, a surprising fact when taking into account the richness of Indonesia‘s “tourist attractions”.

   Recent development shows increasing efforts by the central government to work together with the local government to identify, develop and promote potential tourist destinations other than Bali. Along with the increasing awareness of nature protections, which will attract special tourists to visit Indonesia, the government has also introduced regulations on environment which are related to the sector of tourism, such as:
1. The Decree of the Minister of the Environment, No. Kep-32A/MENLH/7/1995 regarding Proper Clean River Program (Prokasih);
2. The Decree of the Minister of the Environment, No: Kep-52/MENLH/10/1995 on Standard Quality of Liquid Wastes for Hotel Operations;
3. The Decree of the Head of Environment Control Institution (BAPEDAL), No: Kep-32/BAPEDAL/05/1997 regarding Clean River Program, to require hotels to install liquid waste management unit;
4. MOU between the Ministry of the Environment and Indonesian Association of Hotels and Restaurants, No: 02/MENLH/12/1995 concerning the Training and Monitoring of Environmental-friendly Hotels and Restaurants
5. Programs on Evaluating the Achievements of Business Entities in implementation of Clean River Program.

   Implementations of those regulations include the effort to apply environmentally friendly standards for the operations of hotels in Indonesia. The government has planned to include hotels in point 5 above, which include the evaluation of environmental management with the use of rating through colored labels starting in 1998, as follows:
  • Gold labels are given to hotels which have achieved the level of zero emission;
  • Green labels are provided to hotels which have adopted clean technology or minimizing environmental impacts;
  • Blue labels are produced for hotels which are abiding the current regulations on environmental control;
  • Red label is for a hotel which has tried to adopt, but failed to meet the requirements of the regulations on environment;
  • Black labels are for hotels that do not try to abide the regulations on environment, and even damaging the environment.

   One effort of the government to prevent pollution is by providing incentives through the Program of Soft Loan for Environment from Overseas Economic Corporation Funds on Pollution Abatement Equipment. This program is designed to encourage the installation of pollution management units in some businesses of which the operations are potentially damaging the environment. The soft loan with a period of 3 to 20 years is expected to answer the problems of high cost of investments in waste processing units faced by domestic investors.

MORE ON TOURISM POLICIES and THEIR BENEFITS TO THE INDONESIAN ECONOMY

   After several years, private tourism sectors as well as the government, realized that the development of tourism in this country is not only beneficial but has also its negative impact, such as: environmental degradation, economic gap between those related to the tourism business and those who are not, cultural degradation, etc. Massive development of high rise hotels, roads and infrastructures, along with changing use of the land, etc. for the purpose of tourism, have resulted the serious degradation of the environment. Some of these impacts will be described in the case studies.

   As tourism developed, profit-seeking investors have come. Their fresh capital enabled them to own most of the resources, and eventually expel the local community from their own land. This left them with choices of either stay as farmers in less-fertile and smaller size of lands, or taking other jobs such as small merchants, providing services to the tourism activities, etc

   As will be described in the case of Bali, the pressures of capital have affected not only Bali’s economy, but also its culture.
Under the pressure of Indonesian NGOs, informal leaders, religious leaders and other concerned people, the government of Indonesia has started to change its policies on tourism. The government has put its best efforts in promoting people-centered tourism and ecologically friendly tourism.

   Unlike the previous ones, the new policies provide more opportunities for the local people to participate in the tourism development. Under the "tourism build prosperity and peace" theme, the Government of Indonesia empowers small and medium scale entrepreneurs and cooperatives in tourism sector, encourages private--especially the small and medium ones, deregulates licensing process for eliminating high-cost economy, and implements community based tourism.

   Environmentally friendly tourism, or eco-tourism, has been adopted in in the last five years. It, as a mater of fact, has not been a mainstream in the tourism development. Only some areas--consist of national parks, rivers, and forests--are designated to be used for eco-tourism. In developing eco-tourism. It is understood that eco-tourism should make requirements of nature and environmental protection the basis for touristic activities. Thus, it ensures its ecological sustainability.

TOURISM IN BALI ISLAND

   Compared to the total area of Indonesia, Bali represents only 0.29%. Based on 1997’s data, the total population of Bali is about 3.3 million, with a population density of almost 585 person/sq.km. However, Bali ranks as the first in terms of popularity among tourist-destination areas in Indonesia. Tourism in Bali had started since 1926 with the exploitation of the unique Balinese cultural and natural beauty by the Dutch colonial government. The government of Indonesia started in 1960 with the building of the Bali Beach Hotel in Sanur and the Ngurah Rai international airport.

   Bali is internationally known for its dances, temples, and beaches, which have long been recognized as main tourist attractions. In 1996 BaIi attracted a total number of around 3 million tourists, or about 30% of the total number of foreign tourists coming to Indonesia. The trend shows an escalating number over several years. The increase is supported by the infrastructures and facilities.: more than 25,000 hotel rooms of various qualities, international airport which can accommodate large airplanes, ports and more than about 500 thousands Balinese involved in tourism activities.

   Despite the deterioration of Indonesian politics and economy, Bali is still perceived as a very safe and nice place to visit. Bali enjoys the ever increasing number of visitors whom each stays the average of 9 days, with an average spending of about USD 80 per day. Bali is indeed the only tourist destination in Indonesia that is still recommended by the government of Japan, USA, Australia and other European countries. Other areas in Indonesia still suffer significant drop due to the recession and partly to travel bans set by foreign countries. On the contrary, Balinese merchants, brokers, etc. have gained profit from the condition. Tourism industry in Bali still enables Balinese to sustain their consumptive lifestyle.

   The development of tourism industry has played an important role in Bali’s economy due to its limited natural resources. An important indicator of the growth in revenue is the income per capita which has been increasing since 1994 of Rp. 2,22 million, Rp. 2,56 million (1995), and Rp. 2,95 million (1996), with several tourist destination areas as the highest per capita income.

   An indirect impact from the growth is the relatively high population growth rate in these areas compared to other areas. The urbanization as well as migrant workers from other provinces have caused high growth rate of population which affect natural environment, social, economic and cultural life of the Balinese.

   The tourism development plan of Bali is based on two regulations i.e. (1) The Decree of the Governor of Bali No. 528 / 1993 regarding Tourism Area; (2) The Decree of the Local Government No. 4 / 1996 regarding Spatial Planning for the Province of Bali.
The objectives of the above regulations are: (1) To provide guidance for the optimum use of space at tourist destination areas, especially in less developed areas; (2) To reduce the negative impacts of tourism activities on the sustainability of the environment

The strategies on the above are based on the Balinese philosophy of Tri Hita Karana that includes:
  • Strategy of managing sanctuaries;
  • Development of agricultural areas and regional infrastructures;
  • Development of urban and other priority areas.

1. Social and Cultural
Aside from its benefits, the growth of tourism in Bali has some negative impacts, particularly in the social and the cultural dimensions. The Balinese culture has changed due to commercial influences, people alienation from their own land, market orientation of artworks. Among them are:
 Tourism has created income opportunities. Unfortunately, young generations have failed to exercise religious and/or ethical values to generate income; Cases of young people involved in various types of prostitution are common in several popular tourist destination areas. There are street souvenir vendors who sell their merchandise in such ways that annoy the customers, while some others put very high price on the low quality merchandise. These will create the negative image of Bali as a safe and enjoyable tourist destination.
 Expecting more money, some local people who do not have necessary skills take shortcuts to wealth which, in most cases, are not morally acceptable.
 There are also cases where the local community has been alienated from their own village. The flow of investments on hotels along the beach has driven local community out of their lands and even beaches. Beaches are essential to the Balinese, for their religious believe to the Sang Hyang Widi Wasa. Land, sea, and mountain are perceived as one unity. As some beaches are converted into private areas, Balinese are alienated from their own values and can no longer perform their rituals.

    Other main tourist attractions are dances, paintings and sculptures. These art forms have generated a lot of income from the rise of tourist visit to Bali. However, the products of these art forms have been adjusted according to the taste of the market. This resulted in popular market products rather than high quality of art itself. Sculptures, dances, and other art products are originally--for Balinese--for ritual and religious purposes. However, thanks to the market pressure, they are turned into commercial commodities.

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