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nvestment in the Batam hotel industry is showing notable growth, thanks to growing activities in the meetings, incentives, conventions and exhibitions (MICE) business, particularly after the free-trade zone was declared one of the country'€™s MICE cities three years ago.

Investment Coordinating Board (BKPM) Batam branch head Gustian Riau said the hotel industry was attractive to investors due to the high number of visitors, resulting from the growing number of MICE activities on the island.

'€œWe received quite a high number of [investment] proposals from the hotel business. The reason why they choose Batam is mainly due to the high growth of tourist arrivals and a lot of MICE activities held in the city,'€ Gustian said.

According to Gustian, as an investment-licensing regulator, the BKPM welcomes the investors'€™ enthusiasm to invest in the hotel industry in Batam.

'€œA lot of [investors] are looking at the city center in the Nagoya area and Batam Center. Usually they will take over an old building and transform it into a new hotel or build a new hotel in a new space,'€ Gustian said.

As a MICE city, a lot of meetings by many professional organizations in the country are held in Batam, Riau Islands.

One of the activities recently held was the 15th National Musabaqah Tilawatil Quran (MTQ), a Koran recitation contest, attended by more than 6,000 participants from all over Indonesia.

Separately, Batam Tourism Bureau head Yusfa Hendri said that there were 58 star-rated hotels with a combined 7,700 rooms in the area. The city also has 74 units of non-star-rated hotels with 4,400 rooms.

'€œLast year alone, we saw 12 new star-rated hotels open in Batam with many others still under construction. We'€™re optimistic that with the number of visitors, both domestic and foreign, that reached 7 to 8 million people per year, the hotel industry will continue to grow,'€ Yusfa said.

According to Yusfa, the number of foreign tourists visiting Batam is also growing.

Batam is in third position, after Bali and Jakarta, in terms of the number of foreign tourists.

'€œThe presence of these hotels has significantly contributed to Batam'€™s tourism, especially in terms of promotion,'€ he said.

In 2012, the Tourism and Creative Economy Ministry declared 10 cities across the archipelago to be destinations for MICE.

The cities are Bandung, West Java; Batam, Riau Islands; Denpasar, Bali; Jakarta; Medan, North Sumatra; Makassar, South Sulawesi; Manado, North Sulawesi; Mataram, West Nusa Tenggara; Surabaya, East Java; and Yogyakarta.