Foreign investment for hotels down 83.5%

Foreign investment for hotels down 83.5%

JAKARTA (JP): Foreign investment approved by the government
last year for the establishment of hotels plunged by 83.5 percent
to US$132.49 million from the previous year, the Directorate
General of Tourism says.

The office said in a report here yesterday that domestic
investment for hotel construction declined by 33.6 percent to Rp
1.68 trillion ($784.87 million) last year from the previous year.

In terms of projects, the number of hotels -- star-rated and
non-star-rated -- to be established with both foreign and
domestic investment dropped to 63 last year from 85 in 1992.

In 1991, the government approved $1.23 billion in foreign
investment for 18 hotel projects and Rp 4.53 trillion in domestic
investment for 113 hotels.

Director General of Tourism Andi Mappi Sammeng told a press
conference here yesterday that foreign investment for hotel
development was a vital part of investment in the tourism
industry, which declined sharply to $304.51 million last year
from $1.31 billion in 1992.

The tourism industry projects to be developed include
recreation centers, travel agencies, water tourist resorts and
restaurants besides hotels.

Andi commented that foreign investors were apparently not
interested in establishing new travel agencies, restaurants and
tourist resorts last year.

He said that total domestic investment in the tourism industry
also dropped from Rp 2.35 trillion in 1992 to Rp 2.12 trillion
last year.

"Most of the hotels to be established with the investment
committed last year will be located in Jakarta, Yogyakarta and
Bali," he said, adding that investors apparently consider that
the three cities are still well supported by adequate
infrastructures.

Investors are forced to spend a great deal of money to
establish new hotels on islands other than Java and Bali due to
poor infrastructure , he noted.

According to Andi, Indonesia currently has 570 star-rated
hotels totaling 51,116 rooms. (icn)