Tourism investment redirected to North and West Bali

Moch.N. Kurniawan and Novan Iman Santosa, The Jakarta Post, Denpasar/Singaraja, Bali

Tourism has been the flesh and blood of Bali's economy since the island first opened up to outsiders in the l920s. But the fast growing tourist-related industry and the wide development disparity between the province's regencies have forced Bali to redesign its tourism development plan.

Since the early l960s, the development of tourist facilities in Bali has focused on the southern part of the island, particularly Kuta and Nusa Dua in the Badung regency, Sanur in the regency of Denpasar and later Ubud in the Gianyar regency.

Local and foreign investors aggressively transformed areas along the famous beaches in Badung regency and the beautiful terraced rice fields in Ubud into exotic holiday spots. Tourism development also expanded to the rocky hills of Jimbaran, near the opulent Nusa Dua holiday resort, and the crowded city of Denpasar.

Construction of star and non-star hotels, restaurants, cafes was out of control, covering thousands of square meters of land in these busy tourist hubs.

I Putu Cahyanta, the head of Bali's Development Agency, said tourism development must be evenly spread to other areas outside of Badung, Denpasar and Gianyar, in order to prevent social, economic and environmental problems.

To realize this plan, the Bali provincial administration has stopped all tourist-related investment in the already crowded southern Badung regency and Denpasar mayoralty, pushing investment northward and eastward in an effort to distribute tourist-related investment across the province.

"Badung and Denpasar have become crowded after several years of massive development, and it is time to develop other regencies in Bali," said the spokesman of the Bali Capital Investment Coordination Board, I Ketut Suadnyana.

"The provincial administration has decided to channel more investment to Buleleng regency in the north, Gianyar regency in the west and Tabanan regency in the east," he said.

During the first semester of 2002, Bali attracted US$16.7 million in foreign investment and Rp 650 million in domestic investment. Most of the new investments are to develop tourist- related facilities.

Bali has eight developed tourist destinations, six spots currently being developed and one that is undeveloped. Badung has three and Denpasar one developed tourist destination, including the beaches of Kuta and Nusa Dua in Badung, and Sanur beach in Denpasar.

Gianyar boasts several handicraft centers, including silversmith centers in Celuk and Batubulan, and a woodcraft center in Sukawati.

Tabanan is home to Tanah Lot temple, which is in danger because of continuing erosion separating it from mainland Bali.

Separately interviewed, the head of the Buleleng Development Planning Board, I Nyoman Yasa, said the regency was ready to receive new investment for tourist-related projects.

"We have set aside western and eastern parts of Buleleng to be further developed into tourist resorts. As for the central part, we will stop further investment in the Lovina beach area," he said.

"Buleleng has good coverage of electricity and telephone lines to accommodate the needs of new investors," he added.

Yasa said Buleleng had spent some Rp 4 billion developing the 660-meter Lt. Col. Wisnu airstrip in the western district of Gerokgak, some 60 kilometers west of Singaraja, to attract more tourists to the largest regency in Bali.

In addition to Lovina, Buleleng has tremendous tourist potential. In Gerogak and Pemuteran, a number of exclusive resorts such as the Matahari Beach Hotel and the Menjangan Resort have become fresh alternatives to the hustle and bustle of Kuta. The area also boasts pristine diving spots in waters that are home to thousands of marine species.

But compared to Badung and Denpasar, Bali's other regencies are truly underdeveloped.

Statistics from 2000 show that Badung and Denpasar are home to the lion's share of tourist facilities in Bali. Of 117 star-rated hotels, 22 are in Denpasar with 3,003 rooms and 75 are in Badung with 13,883 rooms.

There are seven star-rated hotels with 278 rooms in Gianyar and four star-rated hotels with 171 rooms in Buleleng, while Tabanan has two star-rated hotels with 305 rooms. Another regency that has star-rated hotels is Karanga Asem in the east, with seven hotels and 293 rooms. The regencies of Bangli, Jembrana and Klungkung have no star-rated hotels.

I Gde Pitana, the head of Bali's Tourism Office, said that starting in 2001, Bali began to implement a more eco-friendly and sustainable tourism development.

In some parts of Bali, construction of tourist facilities has exceeded the island's carrying capacity, causing a number of environmental problems.

"Uneven tourist development also creates a wide economic disparity and profit inequity among the regencies," said Pitana during his recent inauguration as a professor at the University of Udayana in Jimbaran.

The tourist-related industry generated about Rp 421.85 billion in revenue for Bali in 2001, and absorbs about 38 percent of the province's human resources. But since most facilities are built in Badung, that regency will receive more tax revenue than other regencies. In 2001, Badung received Rp 314 billion in tax revenue, compared to Bangli (which is located next to Badung regency) with Rp 0.42 billion in tax revenue.

"Spreading tourist-related investment to underdeveloped regencies will more or less narrow the wide gap between the rich and poor regencies, and will also create new job opportunities as well as protect the beauty of Bali from environmental disaster," he said.