The International Finance Cooperation (IFC) of the World Bank Group has committed to further supporting the Indonesian government’s efforts to accelerate tourism development in key destinations beyond Java and Bali.

For the fiscal year from July 2019 to June 2020, the IFC plans to disburse US$300 million to finance private corporations seeking to engage in Indonesia’s tourism sector, IFC country manager for Indonesia, Malaysia and Timor Leste, Azam Khan said.

“We have about $300 million we want to invest in tourism [in Indonesia] and we already have it in our pipeline,” Khan told reporters in Jakarta recently. “We cannot disclose the names of the companies [who will receive the financing] yet, but they mostly develop tourist businesses in Indonesia.”

The IFC, said Khan, believed that catalyzing more investment toward tourism operators would encourage the sector, which offers significant scope for Indonesia’s economic growth in the future.

Tourism is the second-largest contributor to Indonesia’s foreign exchange earnings after crude palm oil, having recorded $16.1 billion in earnings last year according to the Tourism Ministry.

This year, the ministry has increased the foreign exchange earning target from the tourism sector to $18 billion, as the number of foreign tourists is expected to grow to 18 million from 16.4 million people.

With such potential, IFC seeks to finance tourism-related corporations and actors with emphasis on environmental preservation and sustainability, said Khan.

“IFC’s support is in alignment with the government’s efforts to accelerate the development of the tourist industry sustainably. If managed well, the tourism will open up many more opportunities and benefit local communities and businesses, particularly micro, small and medium enterprises,” he added.

Out of the total $300 million target, $10 million has been lent to Singapore-based luxury cruise operator Aqua Expeditions.

Aqua Expeditions, said Khan, was chosen as it had experience in operating luxury sea and river cruises in some of the most fragile tourist attractions in the world, such as in Amazon River in Latin America and Mekong River in Indochina.

Aqua Expeditions CEO and founder Francesco Galli Zugaro said with the $10 million loan it had secured from the IFC, the company was committed to providing a total of $38 million investment for its Indonesian operation for the next two years.

“We operate in mostly fragile parts of the world and we do not want large groups [...] our cruise ship has only 20 cabins and [can accommodate] 30 guests at most,” Zugaro said on the same occasion. “We have a low impact [on tourist sites] but generate high awareness as we are bringing the right type of tourists, responsible travelers who bring value.”

Its maiden voyage will start this November and will offer several routes comprising some of the most exotic destinations in Eastern Indonesia, including Labuan Bajo in East Nusa Tenggara, Maluku Islands and Raja Ampat in West Papua, said Zugaro.

He said he was confident about the future prospects of luxury tourism in the areas Aqua Expeditions is set to operate in, given that those places are known more as budget travel destinations rather than as lavish getaways.

Furthermore, the better-known spots for luxury holidays like Bali and Lombok have become too saturated for tourists, thus opening up opportunities for more locations in Indonesia to offer similar experiences.

Aqua Expeditions offers a range of full-board packages starting from $800 to $1,300 per night per person, he said, adding that the cruise welcomed solo travelers and families.

“We are trying to create demand for this kind of [high-end] tourism project [...] these kinds of tourists have always wanted to go to see Komodo dragons and such but they want to ensure safety and comfort,” he said.