Indonesia's Tourism Sector Threatened by War, Potentially Losing Rp184.8 Billion in Foreign Exchange Daily

Indonesia’s national tourism sector is predicted to be impacted by the war in the Middle East. Coordinating Minister for the Economy Airlangga Hartarto stated that Indonesia needs to promptly reform the tourism sector to mitigate the effects of the global crisis, particularly due to the conflict in the Middle East. He noted that the tourism sector is currently under pressure due to disrupted global connectivity. “Indonesia needs to promptly implement reforms to mitigate losses from the global crisis, as well as build a foundation for tourism and destinations that are competitive, resilient, and highly competitive on the international stage,” Airlangga said in a press statement in Jakarta on Wednesday (18/3/2026). The Ministry of Tourism projects a potential loss of around 5,500 foreign tourists and potential foreign exchange losses of Rp184.8 billion per day if not mitigated soon. An InJourney Airports report for the period from late February to 10 March 2026 recorded disruptions on nine international routes at Soekarno-Hatta Airport and Ngurah Rai Airport. These disruptions affected the mobilisation of 47,012 passengers. These challenges are also exacerbated by rising aviation fuel prices. Airlangga emphasised that the tourism sector remains crucial to focus on, given its significant contribution to the national economy. In 2025, this sector contributed Rp945.7 trillion, equivalent to 3.97% of gross domestic product (GDP). Additionally, the number of foreign tourist visits reached 15.39 million people, growing 10.7% year-on-year (yoy). In terms of foreign exchange, the sector generated US$18.91 billion and supported 25.91 million workers. On that occasion, the Coordinating Minister also outlined several strategic steps that the government can take to keep Indonesian tourism competitive. One of them is expanding the Visa-Free Visit (BVK) policy. Based on a World Travel and Tourism Council study, the BVK policy for 169 countries since 2015 has driven tourist growth of up to 15% per year and created around 400,000 new jobs in the tourism sector. Currently, the Ministry of Tourism has identified 20 potential countries as expansion targets. In addition, the government needs to strengthen the domestic market by leveraging the Eid al-Fitr holiday momentum as the main support. This strategy can be implemented through the micro-tourism concept, namely developing destinations within a land travel radius with deeper tourism experiences. The government has also prepared several stimuli, such as transportation discounts during the 2026 Eid al-Fitr period and the Work From Anywhere policy to encourage domestic tourist mobility. Other proposed steps include negotiating the opening of new international routes, strengthening Indonesia’s branding as a safe and stable destination, and promoting destinations for digital nomads. Regions such as Jakarta, Riau Islands, to the Kura-Kura Bali Special Economic Zone are considered to have potential to be developed as safe technology-based work ecosystems for global digital talent. “With the current exchange rate fluctuations, it should become a hidden potential in attracting tourists because they can get more value from the money they exchange. For that reason, marketing that highlights Indonesia as a high-end destination with affordable prices needs to be strengthened,” said Airlangga. He emphasised the importance of collaboration and synergy among stakeholders in maintaining the resilience of the tourism ecosystem amid global dynamics.