'War on Iraq will cost Bali tourism US$224m'

'War on Iraq will cost Bali tourism US$224m'

I Wayan Juniartha, The Jakarta Post, Denpasar, Bali

The tourism industry in the famous resort island of Bali will
suffer at least US$224 million in lost revenue this year if a
U.S.-Iraq war erupts, industry expert Nyoman Erawan said on
Thursday.

Erawan warned that a war would derail efforts to restore the
industry to health following the devastating impact of the Oct.
12 terrorist bombings.

"The worst case scenario would be if a war breaks out, and
instead of turning out to be a quick and decisive one, it drags
on for many months," he told The Jakarta Post.

He explained that since Australia and Japan, two of Bali's
biggest tourism markets, had expressed their support for a U.S.
attack on Iraq, their citizens would likely be warned against
traveling overseas once the war started, fearing retaliation from
groups opposing the war.

He said that the Bali tourism sector would be further damaged
if the war continued through June until August, traditionally the
peak season for the industry.

Erawan predicted that in the event of war, foreign tourist
arrivals would fall by between 9 percent and 10 percent this
year.

"We will lose around 200,000 potential foreign
tourists in 2003. And since the average daily tourist's
expenditure is $80, the average length of stay ten days, and the
multiplier effect coefficient is 1.4, then Bali's tourism
industry will lose at least $224 million in revenue," he
explained.

He said that such a decline in tourist arrivals would further
damage the island's tourism industry, which was still struggling
to recover from the bombings that killed more than 202 people,
mostly foreigners.

"This would be terrible considering that the number of
foreign tourist arrivals has been steadily declining by
between 3 percent and 5 percent for the last five years," he
said.

Erawan feared a chain reaction from the weakening industry.

He explained that tourism was the backbone of the island's
economy, absorbing 38 percent of the workforce and
generating 60 percent of the island's total Rp 18.9 trillion
Gross Regional Domestic Product in 2001.

Erawan suggested that the industry intensify its efforts
to open up new markets, instead of continuing to
rely on its traditional markets of Australia, Japan,
the U.S. and Europe.

He pointed out that promising new markets such as China,
Taiwan, Russia and the Eastern European countries should not
be overlooked.

He said that the current strategy of attracting more
domestic tourists to the island was simply not enough.

It took four domestic tourists to match the level of
expenditure and the length of stay contributed by one
foreign tourist, he said.

Separately, the head of the Bali Tourist Authority, I Gde
Pitana, stated that a war in Iraq would certainly
jeopardize the tourist industry's recovery program.

So far, the program had produced promising results with
the number of foreign tourist arrivals steadily
increasing to between 50 percent and 60 percent of the normal
level, which led Pitana to belief that the industry would regain
its pre-bombing level by June.

"If a war breaks out then I don't really know what
we are going to do," he said.