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Explore nearby, spend wisely: intra-provincial travel boom
Many households are now exploring destinations closer to home to reduce expenditures.
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Tourists visit Prambanan Temple in Sleman, Yogyakarta, on Thursday, January 2. The Tourism Ministry has set a target of 16 million foreign arrivals this year as the government seeks support from travel and hospitality businesses with more international flights boosting tourist arrivals. (Antara Foto/Hendra Nurdiyansyah)
Yehezkiel Raka Paskalis
The deflationary trend observed from mid-last year through early this year reflects our domestic economic condition, in particular, weakening purchasing power. Monthly Consumer Price Index (CPI) data revealed deflation from May to September 2024. Deflation was again recorded in January and February 2025, with the CPI recording a year-on-year (yoy) deflation of 0.09 percent in February 2025. This sustained deflation signals mounting pressure on domestic consumption, which has traditionally been a pillar of Indonesia's economic growth.
This pressure stems from both domestic and global factors. The labor market faces considerable challenges, with many experiencing layoffs. On the global front, uncertainties related to the trade, energy and geopolitics are further complicating the situation. These challenges have profoundly impacted Indonesian households, leading to widespread employment insecurity and declining real income. Ultimately, these pressures have caused a shift in consumer behavior, with people becoming more defensive in their consumption basket.
Currently, households are prioritizing essential goods, with some even opting for alternative products that offer similar functionality at lower prices. Meanwhile, households are expected to reduce their discretionary spending, particularly on tourism, which often involves significant costs. Unexpectedly, Indonesia's tourism sector has seen an uptick in activity. According to Statistics Indonesia (BPS) data, domestic tourists made 1.02 billion trips in 2024, marking a 21.6 percent increase from the previous year. The majority of these trips were concentrated in Java, with peak travel activity occurring during the Idul Fitri holiday, the major school holiday and the year-end period.
Intra-Provincial Travel
However, the growth in domestic tourism should not be automatically interpreted as a sign of positive development in the tourism sector. We attempted to classify domestic tourist trips based on the distance between the capital cities of the provinces of origin and their destinations. The classification comprises intra-provincial and inter-provincial travel, the latter of which can be further divided into short-distance (less than 500 kilometers), medium-distance (500-1,000 km) and long-distance (more than 1,000 km).
A notable shift emerges when examining domestic tourists' travel distance patterns in recent years. Intra-provincial travel has consistently increased, culminating in a significant surge of 45.9 percent growth in 2024, substantially higher than in previous years. In contrast, inter-provincial travel experienced a decline in 2024, with short-distance trips falling by 7.4 percent, medium-distance trips by 14.8 percent, and long-distance trips by 25.4 percent. This shift contrasts with the trends observed in 2022 and 2023, when inter-provincial travel grew significantly faster than intra-provincial travel.
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