'No vacancy' signs a rare sight in Bali

'No vacancy' signs a rare sight in Bali

Peter Janssen, Deutsche Presse-Agentur, Denpasar

Bali, just about as far away as one can get from New York city, has not escaped the fallout from the so-called "WTC event", as the Sept. 11 terrorist attack on the World Trade Center is referred to on the resort island.

"Before WTC we were enjoying 80 to 90 percent occupancy rates," said K. Suandha, resident manager of The Grand Bali Beach Hotel, the resort's first five-star establishment situated on Bali's tranquil Sanur beach.

Bookings started slip-sliding away in October after WTC. "We expected 85 percent occupancy in November, but it was only 52 percent," said Suandha.

The Grand Bali Beach was also hoping to up its occupancy, but that dream crumbled after "WTC", when international tourists started canceling their vacation plans, especially to perceived trouble-spots such as Indonesia.

One night at the prestigious establishment as of January, 2001, cost only US$50, with a breakfast buffet thrown in as part of the package.

The low prices and negative image poses a considerable challenge for hoteliers and tourism authorities trying to sell Bali as an upmarket destination.

"I'm trying to stop the cannibalization trend," said I Gede Pitana, director of the Bali Government Tourist Office in Denpasar, the island's capital.

Price cutting among the island's hotels started in earnest in 1998, when the resort was hard-hit by a wave of negative news emanating from Jakarta and other less serene parts of Indonesia's far-flung archipelago.

In that year Indonesia was hit by a devastating economic crisis that finally undermined the 32-year rule of former president Soeharto, following mass protests, violent crackdowns, mob attacks on Sino-Indonesian communities and a general perception that the country was not an ideal destination for tourists seeking a relaxing getaway.

Bali has been on the world's tourist map since the 1930s, when Indonesia was still a Dutch colony and business-minded administrators decided to promote the island as a means of filling up the government owned shipping line ferrying goods to nearby Singapore but returning empty.

Several Hollywood films in the same decade helped to establish Bali Hai as one of the world's last tropical paradises.

But the resort's "golden era" for hoteliers only came in 1985 to 1990, when the Indonesian economy was booming and Southeast Asia became a favored destination for affluent Western tourists and the newly-affluent middle classes of neighboring Asian countries.

The surge in demand sparked a construction boom on the island, that swiftly resulted in a hotel glut, when the good times came to a sudden halt with the Gulf War in 1991.

Now Bali boasts 36,000 hotel rooms and most of them are empty. Real prices at the island's hotels have fallen 60 percent over the past decade, said Pitana.

While 2001 started out strong for the island, the WTC event took a swift toll.

Tourist arrivals fell 25, 33 and 15 per cent in October, November and December, respectively, compared with the same months in 2000.

Altogether only 1.3 million foreigners visited Bali in 2001, a 3 percent decline on 2000 figures.

Arrivals from the U.S. and Europe showed the largest declines, but even Japanese tourists, who normally account for 27 percent of the market, were staying away.

To counter the trend, Bali tourist authorities have launched promotion campaigns targeting Japan, China and Taiwan, deemed the markets with the greatest potential this year. They are also working closely with Singapore to turn the island-state into a major regional hub for Asian tourists interested in a beach vacation after a shopping spree.

Singapore Airlines was one of the few carriers to increase its flights to Bali last year, when KLM of the Netherlands and Cathay Pacific of Hong Kong ended their direct Bali routes.

Bali tourism officials continue to tackle the tough marketing challenge of promoting their island as an Indonesian destination that is far removed from Indonesia's somewhat negative image in the post-WTC era as the world's most populous Moslem nation.

Bali's population is predominantly Hindu.

"I don't say anything negative about Indonesia but I say positive things about Bali," said Pitana, explaining his marketing strategy.

"For instance, I will point out that Bali is thousands of miles away from Indonesia's trouble spots such as Aceh, Moluccas, Poso and Jakarta. And I'll say Bali is Hindu, but I would never say it isn't Moslem."