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Jakarta Post

Govt to provide US$1.68 billion stimulus package with hotel, airfare discounts

  • Adrian Wail Akhlas

    The Jakarta Post

Jakarta   /   Wed, May 13, 2020   /   05:39 pm
Govt to provide US$1.68 billion stimulus package with hotel, airfare discounts Tourism is one of the hardest-hit sectors by the current health crisis, with no fewer than 1.4 million workers within the sector having been laid off or furloughed. (Shutterstock/Ajan Alen)

The government is set to provide a Rp 25 trillion (US$1.68 billion) stimulus package that includes airfare and hotel discounts to speed up the recovery of the travel industry after the pandemic subsides.

Tourism is one of the hardest-hit sectors by the current health crisis, with no fewer than 1.4 million workers within the sector having been laid off or furloughed.

The Finance Ministry’s Fiscal Policy Agency head, Febrio Kacaribu, said on Wednesday that the stimulus package, which aims to boost consumption among the middle class, would be effective by the third quarter when COVID-19 restrictions are expected to be relaxed.

“If the public is eager to travel in the third quarter, we will provide a stimulus for tourism, restaurants and transportation,” Febrio told reporters in a teleconferenced briefing. “We are hoping that we will see [a surge in travel] in the third and fourth quarters to boost consumption.”

According to his presentation material made available to reporters, the government would provide the support in the form of airfare and hotel discounts, as well as food vouchers via online applications.

The plan is regulated under Government Regulation (PP) No. 23/2020 on the national economic recovery program, in which the government will carry out efforts to support a recovery after the pandemic eases.

The projected scenario was that large-scale social restrictions (PSBB) would lower consumption significantly in the second quarter, but consumption would recover by the third quarter, Febrio said.

The economy grew 2.97 percent in the first three months of the year as consumption growth slowed while people stayed at home, businesses closed and travelers cancelled their travel plans.

This has upended the tourism industry as the number foreign visitor arrivals plunged significantly by 64.1 percent year-on-year (yoy) in March to 470,898 visitors, a level unseen in a decade, according to data from Statistics Indonesia (BPS).

Tourism and Creative Economy Minister Wishnutama Kusubandio urged travel agents to use digital platforms to help the industry regain its power after the pandemic, adding that he was coordinating with various stakeholders in tourism to be prepared for a surge in tourists by formulating promotional plans.

“The first step is to incentivize Indonesian tourists by coming up with alluring travel packages,” he said. "The pandemic has brought new routines, a new normal."

He also noted new trends in tourism brought about by the outbreak, with health and comfort in particular seeing major changes.

“For the next tourism development, we will focus on the principle things, namely hygiene and sanitation at tourist attractions, accommodation and modes of transportation,” Wishnutama said.

“We will need strong cooperation to further mitigation and recovery efforts, during the pandemic and afterward.”