On shop-house hotels in Batam

Your article that blames Batam shop-house hotels for taking business away from star-rated hotels tells only half the story (The Jakarta Post's April 11 edition, page 5).

Shop-house hotels fulfill a valuable social role in helping this expensive city stay economically competitive. Nobody wants a return to the bad old days in the 1980's/early 1990s when the cheapest wooden boarding house charged US$20 for a tiny unventilated room, and a room in one star hotel cost over $50.

However, it is true that Batam hotel occupancy is in it's worst state ever, with most hotels running well under a third full, ever since Batam's local government closed all entertainment venues during Idul Fitri, last November. Thirty percent occupancy is barely enough to pay a hotel's wages and electricity bill.

The reason for this low hotel occupancy is that four of Batam's strongest economic engines are dead in the water at the same time

Batam's largest industry is still electronics, but it is suffering from the new Free Trade Zone (FTZ) Enclave rules, which are driving up the cost of just-in-time production logistics. No new factories are setting up and about a dozen are moving out. Like the rest of Indonesia, Batam is slowly de-industrializing.

YOHANNES YANSEN Batam