RI not to benefit from visa policy
RI not to benefit from visa policy
Evan Jones, Batam
It is welcoming news to see that our new State Minister of
Culture and Tourism Jero Wacik is looking at extending the number
of countries whose tourists will be eligible for a visa on
arrival, albeit a visa that costs US$25 and is only valid for 30
days.
Jero says he is undertaking a survey of major entry points to
see what needs to be done to improve the performance of
Indonesia's queue-up-and-pay visa policy.
May we suggest to Jero that he extend his survey to the
tourist industry itself, to determine that this visa policy is
not only earning, but also costing the country? The losses caused
by this policy are large but invisible; it will take more than
some visits to airports and ferry terminals to understand what
this visa policy costs Indonesia.
Indonesia is only realizing only a small percentage of it's
potential to attract tourists. For example, in the case of Batam
vs Singapore, if we could follow the model of Macau vs Hong Kong,
Batam should be receiving the same or more than Macau -- five
million tourists per year. Instead, Batam gets about 1.5 million.
This pitiful performance is caused by decades of ineffective
tourism promotion, poor image management, no effort to counter
negative reports in the international media; now compounded by
unfriendly, expense and restrictive Visa-On-Arrival regulations.
For example, Singapore has nearly half a million wealthy
expatriates, whose children attend various International Schools
in the city-state. There is a huge demand from Singapore's
schools to get the kids out of the city and into a wilderness
experience.
A number of first class wilderness locations exist in the
neighboring Riau islands. Schools and private businesses have
invested in developing wilderness camps in the neighboring
islands of Bintan, Batam and Sugi.
This kind of business is ideal for Indonesia: It encourage use
of the natural environment, it is labor intensive and brings
jobs, skills and prosperity to otherwise poor subsistence farmers
and fishermen. The interaction between the kids and villagers
promotes life-long personal friendships and international
understanding. A classic win-win situation.
The benefits of school camp business far outweighs a paltry
$10 or $25 collected by the Jakarta government.
Unfortunately due to onerous visa rules, passenger transfers
to these camps, which used to take two or three hours, now takes
nearly a day. In terms of time, a children's camp in Malaysia or
Thailand is now more easily reachable than one which you can
nearly see from a Singapore high rise building!
Where once, wilderness camps were poised for growth into a
business employing thousands of villagers, the Riau Islands now
has just two remaining camps. (Three others have closed.)
A second example can be found on the island of Batam, which
has struggled over the past decade to upgrade it's seedy image as
cheap weekend getaway for minimum wage workers from Singapore and
Malaysia. Investors have built a world class tourism
infrastructure of star rated hotels, resorts, golf courses and
casinos.
Compared to Macau, Batam is three times closer and easier to
reach, more efficient and more friendly. Batam's Nagoya
Entertainment District (NED) had a slogan: For the same price as
a few hour's drinking on Singapore's Orchard Road (say, US$200),
the well heeled visitor could come to Batam and for the same
money enjoy a four star hotel room, return ferry tickets, meals,
drinks, taxis, entertainment and tips.
Unfortunately the $25 visa that takes up over a page in the
visitors' passport has killed this business. Immigration queues
to pay are long and slow, the immigration officers are stressed
and surely with the visitors. Batam's shrinking number of loyal
golfers and overnight pub trippers quickly end up with a passport
full of huge and useless visa stickers. The whole experience
leaves such a bad taste in visitor's mouths that too many
Singapore-based expats now choose to spend their weekends in
Johore or Phuket.
The once popular pastime of the after work ferry trip from
Singapore to do an hour's jogging in Batam's pristine forests is
a now thing of the past.
The loss to Batam is not just a few bankrupt entertainment
outlets but a loss of revenue and opportunity. When Indonesia
loses a thousand high spending visitor arrivals, the loss of a
US$10 visa fees is not the main issue.
Where does the expenditure of that overnight visitor with a
US$200 budget go? A lot goes into the government's pockets as
taxes. Let's do the sums: Ferry ticket $15 (terminal taxes = $2),
Hotel room for $85 - (10 percent tax = $8.50), taxi fares of $10
(no tax), $50 worth of drinks and entertainment (10 percent taxes
and 2 percent customs and excise = $5.20 ). Total in directly
deducted taxes =$15.70.
In other words, some tourism bigwigs may look down their noses
at the overnight visit market, but if you lose a thousand of
them, governments lose 1,000 x $15.70 in taxes and the people
lose $200,000 in tourist spending. But according to the lessons
to be learned from Macau, Batam isn't losing thousands of tourist
arrivals, it is losing millions.
What we really hope our new minister for tourism will do is
launch a truly bold objective for Indonesia's tourism industry.
If tiny Singapore can recycle tourist taxes into promotions that
brings seven million tourists a year, let's remove Indonesia's
small minded and antiquated business obstructions, start spending
some tax revenues on promotion and shoot for, say, 14 million
tourists a year as a starting point.
The writer is a business analyst.