Income target from tourism lowered

JAKARTA (JP): The government has lowered the projection for foreign exchange receipts from foreign tourists this year on fears that the haze problem will cause a decline in tourist arrivals.

According to data provided by the Ministry of Tourism, Post and Telecommunications, revenue from foreign tourists will total about US$6.5 billion this year, much lower than the initial projection of between $6.64 billion and $7.14 billion.

The number of foreign tourists will be about 5.19 million this year as compared to the previous projection of between 5.3 million and 5.7 million.

The Indonesian Tourism Promotion Board has said that the haze caused by prolonged forest fires in Sumatra and Kalimantan and the currency crisis facing several Southeast Asian countries will discourage foreign tourists from visiting Indonesia.

Board chairperson Wuryastuti Sunaryo estimated that the number of foreign tourists would only increase by 5 percent this year, less than half of the 12 percent projected by the government.

The ministry's data also shows that revenue from foreign tourists and the number of international visitors in 1998 will also be lower than original targets.

It is estimated that the government will only receive $7.14 billion in foreign exchange from foreign tourist arrivals next year, lower than the original target of between $7.51 billion and $8.14 billion.

Foreign tourist arrivals are also projected to decline next year to 5.7 million from the original target of between 6 million and 6.5 million.

The lower figures have also been set because of poor aviation services.

An Airbus A-300 B4 airplane of state-owned Garuda Indonesia crashed and killed all 234 passengers on board two weeks ago just before it was to land at Polonia Airport in Medan, North Sumatra.

The crash, the worst in Indonesian aviation history, happened while North Sumatra was covered in a thick haze from smoke coming from widespread forest fires. Poor visibility due to the haze had presumably played a role in the crash.

Hotels

Three-star hotels in Jakarta have reported the impact of the ongoing currency turmoil.

Putu Ayu Aristyadewi of the four-star Acacia hotel in Central Jakarta said that business-wise, hotels could benefit from the currency crisis because room rates were generally in U.S. dollars.

"But we also suffer from an unexpected increase in expenses, as our suppliers of meat, vegetables and other goods have raised prices," she said.

She said that hotels always changed their daily dollar rates according to rate fluctuations in the market. "Some of the guests have complained about this, but we can't just do nothing."

However, dollar rates set by hotels differ between one to another. Some even offer rates much lower than market rates to attract guests.

She said her 210-room hotel, however, saw a stable occupancy rate in the last three months, 82 percent in July, 85 percent in August and 78 percent in September.

Eka Naim of the 125-room Ibis Tamarind said that his hotel had not experienced a hike in prices from suppliers, which could affect room rates.

"There have already been some cancellations for conference and meeting rooms," he said, adding that the occupancy rate for the last three months was stable.

Narulia Decia of Dusit Manggadua said that her hotel had seen a lower occupancy rate in the last two months.

"This is unusual. Last month we only saw an occupancy rate of 50 percent," she said.

She said that her 351-room hotel usually had an average 65 percent occupancy rate.

The forest fires in Kalimantan and Sumatra have not only affected the air quality in both areas, but also in neighboring Malaysia, Singapore and the Philippines.

Many travelers and tour groups from European and Asian nations have canceled trips to Indonesia due to the haze problem.

The government predicts tourism will generate the highest revenue, replacing the oil and gas sector, by the end of the seventh five-year development plan in 2004. In 2005, Indonesian tourism is expected to attract 11 million foreign visitors and generate about $15 billion in revenue.

Official data shows that about 2.82 million foreign tourists entered the country in the first eight months of this year, a 2.8 percent rise from the same period last year. During the period, the government earned about $3.44 billion from foreign tourists, up 7.4 percent from $3.44 billion in the corresponding period in 1996. (icn)