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RI tourism suffers $1.5 billion loss as COVID-19 hits hard
The Indonesian tourist sector has suffered losses of at least US$1
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span>The Indonesian tourist sector has suffered losses of at least US$1.5 billion since January as cancelations have hit the industry, especially hotels, amid growing fears over the outbreak of the novel coronavirus, an industry source has said.
Indonesian Hotel and Restaurant Association (PHRI) chairman Hariyadi B. Sukamdani said that of the total estimated losses, about $1.1 billion occurred as a result of cancelations made by tourists from China and the remaining $400 million resulted from cancelations made by tourists from other countries.
“The losses are growing as people prefer to stay at home rather than going on vacation,” Hariyadi, who also chairs the Indonesia Employers Association (Apindo), said in Jakarta on Thursday.
He said that other related businesses such as the suppliers of hotels for their daily operations, which mostly comprise small and medium companies, had been badly affected. He feared that if the situation continued, such small businesses could be forced to shut down completely.
Hariyadi said almost all major restaurants and hotels in the country’s tourist destinations had now been hard hit by the sharp fall in the number of tourist arrivals. Unlike in the early days of the novel coronavirus outbreak, the cancelations only affected major tourist destinations such as Bali, Batam and Manado, which are popular with Chinese tourists.
The PHRI reported the country’s overall occupancy rate had fallen below the low season average of 50 to 60 percent to 30 to 40 percent since the outbreak of the coronavirus in China in early January. In Bali, the occupancy rate had dropped to 20 percent, especially in areas visited by individual travelers such as Kuta, Sanur, Legian, Ubud and Jimbaran.
“This is also made worse by growing fears over the virus and the government’s measures to restrict gatherings of many people. The restriction is contradictory to the government’s recent policy of providing financial incentives to promote tourism,” Hariyadi said.
Indonesia Travel Agents Association secretary-general Pauline Suharno who is also the director of Elok Tour also said the fears over the COVID-19 epidemic had severely hit local travel agencies.
Paulina said ticket sales for inbound and outbound flights fell sharply not only for those traveling for holidays but also for pilgrimages such as the minor haj to Mecca for Muslims. “At first, we were still confident tourists from outside China would continue to visit Indonesia, but over time COVID-19 has affected all countries and all travel activities, even those related to pilgrimages,” Paulina told The Jakarta Post on Thursday.
The government’s appeals to the public to avoid crowds and to stay home will further damage the travel agency business.
As of Thursday, the Association of Air Ticketing Companies in Indonesia (Astindo) recorded near 90 percent drops in sales following booking cancellations caused by fears over the coronavirus epidemic. Meanwhile, in February, Astindo members recorded potential losses of Rp 4 trillion ($267.88 million)
Moreover, Hariyadi said he could not estimate how long the fear over the spread of the coronavirus would affect tourism. If the spread of the deadly virus could not be controlled, people would still be reluctant to go on vacations, he added.
