T

he Bali administration is considering a moratorium on the development of hotels in the three most crowded regencies on the resort island, after recommendations from the association of hotel owners.

Bali Governor Made Mangku Pastika said that it was crucial have a moratorium on new permits for hotel construction in Denpasar, Badung and Gianyar, since the number of hotel rooms in the three regencies now exceeds demand.

The moratorium is needed to balance tourism development across Bali, especially in Buleleng, Bangli, Karangasem, Jembrana, Tabanan and Klungkung, which were considered to be lagging behind Denpasar, Badung and Gianyar, he said.

“Development of tourist facilities should be shifted to other regencies outside Denpasar, Badung and Gianyar,” the governor said after meeting tourist operators Thursday.

These three regencies recorded the highest tourism volumes and revenues compared to any others.  

“We could apply a moratorium on hotel development by proposing a recommendation to the tourism ministry and the Investment Coordinating Board [BKPM] to stop offering investment opportunities to develop hotels in these three areas. I hope regents will have similar views on this problem,” Pastika said.

The administration is waiting for the result of a study by the Bali chapter of the Indonesian Hotels and Restaurant Association (PHRI) before issuing the moratorium.         

“We are also thinking to regulate the moratorium in a bylaw,” the governor added.  

Data from the provincial tourism agency in 2009 showed there were around 46,000 hotel rooms in 2,175 hotels and guest houses on Bali, including 981 lodges, 1,037 low-priced hotels and 157 star-rated hotels.

Most of this accommodations is located in Badung regency with 630 hotels, followed by Gianyar with 608 and Denpasar with 250. Buleleng has 218 guest facilities, while Karangasem and Tabanan have 222 and 120, respectively.

The regencies with the least accommodation are Bangli, Jembrana and Klungkung.

A recent report from the Udayana University tourism research center showed that the supply of hotel rooms in Bali has outstripped tourist demand. The report suggested that the current available facilities would be enough for the next five years, when there would be an estimated 6.6 million tourists.   

The report said there were many unoccupied tourist facilities, including star-rated hotels, low-priced hotels and lodges. It called for a moratorium on hotel development. Researchers previously estimated the island would need 38,000 hotel rooms by 2015, but this number was actually reached in 2007.

Bali previously implemented moratorium on tourism development during the tenure of former governor Dewa Made Beratha, but this was revoked after the island’s municipal and regency administrations were given the authority to issue permits for tourist development without securing approval from the provincial administration.

Hotel operators said too many hotels had caused unhealthy competition.

Perry Markus from PHRI said the association is currently conducting the study to find out the need of accommodation in Bali compared to tourist demand, adding that the southern part of the island had too many hotels compared to the northern and eastern areas.

“The study includes whether hotel development could be included on the list of negative investment in Bali,” Perry told The Jakarta Post.    

“We’re also studying which type of accommodation should be halted, either only star-rated hotels or other types as well.”     

He said the study, involving hotel associations in each regencies and tourism researchers, was expected to be completed next month, and the results would be proposed to the governor.