Tourism body to tie up with S'pore company

Tourism body to tie up with S'pore company

JAKARTA (JP): The Indonesian Tourism Promotion Board (ITPB)
will establish a joint venture with a Singapore-based firm later
this year to help boost tourism campaigns and revenues.

Chairman of the board, Tanri Abeng, said yesterday that the
planned joint venture will be 40 percent owned by PT Bangun
Nusantara Indah, an affiliate of the board, and 60 percent by a
Singaporean firm.

"The planned company will handle international-scale
conferences and exhibitions in Indonesia and its profits will be
passed on to ITPB," he said at the House of Representatives.

By organizing such events, the board will also be able to
promote the country's tourist industry and generate revenues at
the same time, he said.

In his hearing with the House Commission V for tourism,
housing and transportation, Tanri reported that ITPB has incurred
debts of Rp 21.98 billion (US$9.7 million) to advertising agents
and other parties used for their promotional activities.

"However, our revenues are very limited," he said.

The board, under a presidential decree, is supposed to collect
two percentage points from the 10-percent local development tax
imposed on hotels and restaurants in the provinces of North and
West Sumatra, Jakarta, West, Central and East Java, Yogyakarta,
Bali, North and South Sulawesi. Local administrations in the
provinces are required to extend the two-percentage point portion
to the Ministry of Tourism, Post and Telecommunications, which
passes the amount on to ITPB.

Tanri said yesterday that in 1994-95, ITPB received only Rp
5.92 billion (US$2.6 million), far lower than the Rp 55.99
billion targeted by the government, in revenues from the
development tax.

"In the current 1995-96 fiscal year, we have received just Rp
1.22 billion out of the targeted Rp 64.17 billion," he added.

Minister of Tourism, Post and Telecommunications Joop Ave said
in April that by the end of March 1995, a number of local
administrations had reported the results of their development tax
collections from hotels and restaurants which reached Rp 26.47
billion.

No payment

Tanri said yesterday that the Indonesian Hotel and
Restaurant Association recently reported that the association has
already paid the funds to the local administrations.

"But we are wondering where the funds are actually now because
we have not received any payment from the Ministry of Tourism,
Post and Telecommunications," said Tanri, who is also top
executive of the widely-diversified Bakrie Group.

"I heard that tourism minister Joop Ave has reported this
matter in a cabinet meeting, while the Ministry of Home Affairs
has also instructed local governments to deliver the payment to
ITPB," he said.

Minister of Information Harmoko told reporters after a cabinet
meeting on the economy yesterday that President Soeharto had
instructed the tourism minister and the minister of home affairs
to coordinate the channeling of the promotional funds from the
local administrations to ITPB.

"The funds are designed for the promotion of the tourism
industry, not for the local administrations," Harmoko said.

ITPB, which was set up in 1991 as an independent foundation,
spent $20 million last year on promotional activities through
advertisements in the print media and on television. By
comparison, Australia, Singapore and Thailand spent about $92
million, $40 million and $38 million respectively on tourism
promotion.

In addition to the development tax and funds from Bangun
Nusantara Indah, ITPB earns revenues from promotion programs,
which generated Rp 15 billion in revenues last year.

By 1999, Indonesia hopes to attract 6.5 million visitors per
annum and $8.9 billion in revenues. This year, some 4.65 million
foreign tourists are expected to visit the country. (icn)