Battered hotel industry faces gloomy outlook

Battered hotel industry faces gloomy outlook

JAKARTA (JP): The battered hotel industry is facing a gloomy
outlook as fears of social unrest in the country continue.

Rudy Setiawan, an executive of the Hotel Sales Management
Association, said here yesterday that occupancy rates of star-
rated hotels plunged last month to 40 percent from an average
monthly level of 75 percent before the economic crisis hit the
country in July.

He said a recent government decision to cease giving permits
for public events, including conventions, a week before and after
the People's Consultative Assembly's General Session would hurt
the hotel industry.

Reports of riots and street demonstrations in several parts of
the country was also a heavy blow to the already battered
industry, he said.

"The political event is a continuation of a series of events
and incidents which have hit local hotels since last year," said
Rudy, who is also the marketing director of the Hotel Santika
Group.

He said many tour operators and convention groups have
canceled plans to travel to Jakarta due to the coming General
Session which will elect a president for the 1998/2003 term.

A series of riots have occurred during the past several weeks
mainly in Java over soaring prices, shortages of basic goods and
mass unemployment.

"Foreign press coverage forms the international perception
that Indonesia is about to erupt into massive social unrest," he
said.

Several hotels, however, reported high occupancy rates this
month.

The public relations manager of Hilton Hotel, Dewi Widiyanti,
told The Jakarta Post that its occupancy rates were currently at
about 60 percent, but that the rate was expected to fall soon.

"Our rates are rather high now because we have many foreign
diplomatic delegations visiting the country," Dewi said.

Holiday Inn Crowne Plaza public relations manager Chandrawati
Hadisumarto said many companies have postponed plans for meetings
until after the presidential election.

Chandra said the hotel's current occupancy rates were about 70
percent, but that half of the hotel's rooms were not open for
guests.

The downturn in the country's hotel industry started last
year.

According to the Hotel Sales Management Association, the
average occupancy rate of star-rated hotels in Jakarta fell to 76
percent last year from 83 percent in 1996.

Last month's occupancy rates of several international five-
star hotels, such as the Hilton, Mandarin, Regent, Sari Pan
Pacific, Le Meridien and Shangri-La, ranged between 28 percent
and 37 percent.

Rudy said there was a decline in the number of foreign
visitors since the beginning of the general election in May last
year.

Following the election, severe forest fires in Kalimantan and
Sumatra blanketed much of the region in a choking smog,
dissuading tourists from traveling here. (das)