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)