E n g l i s h

| Home | R e s e r v e | R e s e r v e | R e s e r v e | R e s e r v e | C o n t a c t |















My Indonesia - Just A Smile Away

2002 has been designed as the year for ECOTOURISM by the UN and 27 September has been decided as the tourism day by the government of Indonesia.

In line with the International Year of Eco-tourism, Indonesia has also launched another theme for the year 2002 as the Year of Mountain or to be more specific Volcanoes. Also the year 2003 as the Year of Marine Tourism. The theme was aimed for more specified focus whilst in fact Indonesia has a lot more to offer.

Indonesia’s potencies on eco-tourism is mainly in its resources. Indonesia is known as a country with mega diversity. In terms of bio-diversity, Indonesia is a home for 10% flora in the world, 12% of mammals, 16% of amphibians, and reptiles, 17% of birds, 25% of fish and 15% of insects. As an archipelago with 17,508 islands, the country has many different types of eco-tourism to explore. Over a hundred million hectares of forests in Indonesia is also a promising indicator. 30 million hectares of them are protected forests, and over 15 million hectares are nature preservation area comprises of national parks, grand forest parks and nature recreation parks, and around 7.3 million hectares are nature conservation area that includes the natural preserve and the animal conservation areas located in many different provinces. Indonesia’s water is a home of world class underwater resources, which are managed by sea national parks management.

The priority of Indonesia’s potencies on ecotourism will be developed in each region such as:

  1. National Park of: Ujung Kulon, Krakatau and South Bukit Barisan coordinated by Department of Forestry.
  2. Mount of: Merapi and Merbabu, and Temple of Borubudur and Prambanan coordinated by Department of Mine and Energy
  3. National Park of: Rinjani, West Bali, Baluran, Meru Betiri and Alas Purwo coordinated by Department of Internal Affairs.
  4. National Park of: Komodo Island, Wakatobi and Takabonerate; and Natural Tourism Park of: Riung 17 coordinated by Department of Marine
  5. National Park of: Bunaken, Sangalaki & Derawan Island and Kutai coordinated by Ministry of Environment.

Besides its mega diversity in biological resources, Indonesia also offers a diverse geography and geology to be explored. The caves are among another potential for eco-tourism, not only as natural wonders but also of its historical remains inside.

Diversity of culture, that includes various ethnic groups, regions, traditions and all other dimensions of culture, are spices to the richness of our natural resources because of the relations between the two and also its relations with the “Creator”. Some of our natural and cultural heritages have been included in the list of world heritages. In short, not only the number and the size of resources but also its diversity, authenticity and uniqueness are more important in valuing the potential for eco-tourism development.

Jakarta, as a microcosm of the Indonesian archipelago is the capital city of Indonesia and gateway to the entire nation. It is the nation’s pride, acting as the social, cultural, political and economic hub of the entire nation. More than 25 museums are located within the city. A special culture, referred to as “Betawi”, evolved from the exposure to many cultures and mingled with the local ingenuity.

Java is no less full and diverse in the experiences it offers. Central Java as the heart of Indonesia, with its ancient temple, regal places and majestic traditions of hallowed antiquity, it is the cradle of an ancient court which has produced some of the world’s finest and most sophisticated performing arts. “Batik” making in Java rose to its most sophisticated level in the hands of sophisticated artisans. A living court culture continues today, surrounded by ancient temple ruins dating back to the 7th century. West Java is well known for its nature and high adventure offerings. While East Java features mountain resorts, ancient temple remains and the lively “Kerapan Sapi” bull races.

Bali is the island of the Gods with its breathtaking landscape and outstanding traditions. Many hail Bali as the true shangrila. Bali has been a world-class tourist destination for many decades, so much that often people think that Indonesia is a part of Bali, instead of the other way round. Bali offers a vibrant Hindu based culture, fully alive with colorful temple festivals and rich and fertile landscapes, yet offering some of the best international hotel resort developments available anywhere in the world today. The Bali experience includes just about everything for anybody, including a beautifully orchestrated living culture, high adventure, and some of nature’s best expressions. To visit this unique island is to have one’s mind ever-imprinted within the image of cascading rice terraces, and the generous smile of warm and hospitable people.

Moving further westward, Sumatra is a less populated island, with expansive stretches of dramatic mountain range. Lake Toba, one of the largest natural lakes in the world, is an ideal location for peaceful meditation on the beauty of nature. This island is characterized by spectacular architecture and interesting life rituals. Amazing fauna and flora, including the world’s largest flower (Rafflessia Arnoldi) abound throughout Sumatra’s diverse natural environments.

In the mysterious jungles of Kalimantan, travelers meet with the many ethnic tribes who live in the sanctuaries of some of the world’s largest rain forests. The Indonesian government carefully conserves the environment, which is the home for many rare species of animals and plants. A boat trip on the network of rivers on this huge island brings a traveler to the heart of nature, and home for people who have lived in the pristine forest for many centuries.

Many travelers venture into the orchid-shaped island of Sulawesi, visit the ancient trading port of Makassar, and then drive up to the central mountains to discover Tanah Toraja, where the most unique form of ritual and architecture has evolved. Houses and rice storage barns look like majestic ships on a sea of green. The people of Toraja have ancient life and death rituals, filled with spirited danced and music, plus the area is superb for hiking and mountain biking. Manado, in North Sulawesi, is a favorite resort area, with world-class scuba diving opportunities.

Jumping over to Eastern Indonesia, clusters of islands each contain their own distinct culture and environment. This is the “new frontier” of our tourism industry. Within these islands lives the exotic Komodo Dragon, a world of ancient cultures, distinct textiles, various forms of pottery making, a wide variety of festivals, and some of the world’s best marine life. To travel through this area in a traditional boat “phinisi” sailing craft is truly a world class experience.

Irian Jaya, the eastern most province of our country allows an adventurous traveler to go back into a Stone Age civilization, yet be submerged in the many different peoples of this vast and resource rich region living close to their natural environments, producing ancient art forms that have become world traveler collector’s items. Irian Jaya offers one of the world’s last true frontier areas.

Distribution of Visitor Arrivals
By Province

Province 2000 2001
North Sumatera 130,827 144,164
West Sumatera 12,855 9,538
Riau / Batam 2,011,932 2,048,118
Jambi 2,142 3,526
South Sumatera 4,624 16,921
Lampung 6,536 6,540
Bengkulu 1,251 1,100
Jakarta 1,092,569 1,111,645
West Java 6,234 16,433
Central Java 18,772 46,322
East Java 135,251 140,362
Bali 1,481,351 1,447,292
West Nusa Tenggara 25,212 34,156
West Kalimantan 36,895 34,126
South Kalimantan 11,915 17,800
East Kalimantan 58,951 46,137
South Sulawesi 7,283 6,172
North Sulawesi 16,847 24,841
South East Sulawesi 372 0
Central Sulawesi 833 296
Other 1,565

In principle, tourism development in Indonesia is development which does not only concern about how to keep capably the natural condition or known as bio-diversity of land, water and air, but also all aspects of life that need to be conserved, including social culture of human being.

Tourism development is directed to increase tourism to become main sector which is able to promote economic activity including other related sectors. It is intended to improve and take advantage various national tourism potentials which can increase employment opportunities, state's income and foreign currency earnings.

The exceeded target of foreign currency visits is inseparable from the development of main aspects, either domestic aspect or foreign aspect, i.e. marketing, product, accessibility and tourism infrastructure aspects. In its marketing aspect, Indonesia has better opportunity because of its image tourism has been improving. In addition to domestic tourism events which has been better scheduled, Indonesia's tourism has also performed joint promotion in the frame of bilateral and regional cooperation. It causes marketing activity and tourism product have increased recently. Indonesia's opportunity in tourism's product aspect is the increase of hotel room as many as 42,500. Thereby the total foreign tourists that can be catered is 107,857 rooms. In addition, in line with the increasing of intensive group who are ferried by Garuda Indonesia especially from Japan, Indonesia's position as "New Convention Destination" in Asia Pacific is getting better.

The Growth of Visitor Arrivals to Indonesia
and Foreign Exchange Earnings 

Year Visitor Revenue Growth Visitor Growth Revenue
US $ Million
1989 1,625,965 1,284.50 25.00 25.00
1990 2,177,566 2,105.29 33.92 63.90
1991 2,569,870 2,522.01 18.02 19.79
1992 3,064,161 3,278.19 19.23 29.98
1993 3,403,138 3,986.58 11.06 21.61
1994 4,006,312 4,785.26 17.72 20.03
1995 4,324,229 5,228.34 7.94 9.26
1996 5,034,472 6,307.69 16.42 20.64
1997 5,185,243 5,321.46 2.99 -15.64
Econ Crisis
1998 4,606,416 4,331.09 -11.16 -18.61
1999 4,727,520 4,710.22 2.63 8.75
2000 5,064,217 5,748.80 7.12 22.05
2001 5,153,620 5,411.30 1.77 -5.87
2002 1,320,052 1,386.05

Indonesia's opportunity in accessibility and infrastructure aspects is by developing international flight routes to several cities beyond the four main gates which make up 23 international air gate today. In addition to that, while developing domestic flight route which promote local tourism development, amount of cruiser which call at several Indonesia's port is also increasing. Behind opportunity factor, there are still some challenging factors which hamper tourism development of Indonesia. Among the challenges are the growth of new destination such as Cambodia, Vietnam, Eastern Europe and Taiwan.

Other obstacles are that promotion by government and private enterprises has not yet been well integrated besides the inadequate market information, especially in tourism market segment. However, this can be reached optimistically considering that tourism supporting means owned by Indonesia's Government will consistently develop opportunity factors, while trying to lessen hampering factors which will become constraints in determining the target.

Prospect of Tourism

In its effort of raising the needed development fund, either Rupiah or foreign currency, Indonesia's government also strives to decrease its economic dependence to oil and natural gas sector by making tourism sector to become one of main sources of foreign currency earning and even it is expected to become the main foreign currency earner in 2005 whilst remains referring to social cultural and environment aspects to improve Indonesia's life quality and nation's welfare. It is expected that the target of tourism program for the year of 2005 who will visit Indonesia would be 11 million visitors. At that time, Indonesia's tourism industrial transportation is expected to become the main source of foreign currency earning, employment opportunity opening, and tourism added value increase. Therefore foreign currency earning from tourism sector is targeted to rise to at least USD 15 million or more or less three times than that of 1995.

Indonesia's government policy in attaining tourism program in 2005 among others are in marketing sector to perform marketing campaign by picking up foreign tourist directly from their home countries. Even Director General of Immigration has issued Immigration Clearance on Board policy, that Immigration checking is to be done, either on board the air plane or on the ship on the way to Indonesia. This policy will enable foreign tourists or short - term visitors who fly by Garuda Airways from Japan (Tokyo and Osaka), or from Taiwan (Taipei and Kao Hsiung), not to queue at Immigration counter upon arrival at the Soekarno-Hatta Airport or the Ngurah Rai Airport of Indonesia. This facility is also applicable for ship's passengers from Thailand (Phuket), Malaysia (Port Klang, Penang, Malaka and Langkawi), Papua New Guinea (Port Moresby), Australia (Darwin, Sidney and Perth) and also the Philippines (Manila and Davao). Immediately, upon arrival at the destination port in Indonesia, they can directly visit tourism object without having to report for Immigration checking as it has been done on board the airplane or ship on their way to Indonesia. Immigration officer who handles Immigration Clearance is the Indonesian Immigration Officer who performs his duties on board.

Visitor Arrivals to Indonesia
By Country of Origin

Country 1995 1997 1998 2000
Singapore 1,046,533 1,376,377 1,466,660 1,427,886
Japan 486,278 706,942 469,409 643,794
Malaysia 511,903 481,713 491,597 475,845
Australia 320,903 539,156 394,543 459,994
Taiwan 352,797 404,929 281,959 356,436
Republic of Korea 115,091 246,307 177,852 213,762
USA 155,111 185,976 141,314 151,897
UK 165,788 142,161 137,600 161,662
Germany 167,653 185,976 141,314 151,897
Netherlands 136,858 144,622 81,507 105,109
France 80,422 107,843 70,396 93,477
Philippines 96,242 50,925 104,192 79,682
Hongkong 93,163 103,450 53,500 72,461
Italy 55,725 67,802 50,383 63,208
Thailand 38,908 45,676 47,335 48,477
Switzerland 44,016 30,188 26,101 33,740
New Zealand 28,339 38,762 32,590 32,659
Canada 30,700 27,075 25,091 29,952
India 31,968 26,418 40,850 34,221
Saudi Arabia 24,571 28,608 41,875 33,027
China 38,895 24,684 34,327 29,352

In the sector of tourism product.

To determine tourism product in the Eastern region, Western region and to accelerate tourism's product development in Indonesia Eastern region. In line with that, efforts are also taken to increase competitive power of tourism product in global market through pricing policy. Effort in developing object and tourism attractiveness, promotion activity and its marketing, either domestic or overseas market is kept increasingly organized, integrated, effective among others by optimally using regional and global tourism cooperation.

In sector of human resources. To prepare skilled and professional manpower in tourism sector as well as to increase hospitality, comfortability, service facility at the gate of tourism object and tourism region in Indonesia. Tourism Training and Education has been increasing followed by preparation of better means and infrastructures for the purpose of increasing the ability to ensure fluency of service and also tourism organizing.

In sector of institution and regulation. Government has stabilized product and regulation is adjusted with development and challenge which will be encountered in the future.

In sector of infrastructure and accessibility. To take foreign tourism directly (point to point) at a competitive cost while assuring comfort and improve public utilities such as transportation, water supply, electricity and telecommunication.

In sector of investment. To give incentive to push investment in Indonesia's Eastern region in accordance with the regional condition, in addition to improve investment in Indonesia's western region.

In sector of living environment. Indonesia's tourism development is based on quality and friendly environment.

In territory sector. Priority of tourism destination is adapted to the region's potential in the field of science and technology and information sector. To increase information flow through data base circuit, information unit and adequate 'Computer Reservation System'.

In sector of supporting facility. To use and increase supporting facility such as security, health and regularity.

Business Prospect

Globalization which is pushed by drastic progress in the sector of technology, especially telecommunication technology, have smoothen flow of information in all of its impact, positive or negative. Opportunity opens through globalization when international market becomes openly wider to domestic product especially to the product's competitive values. The challenge in economic sector is, in addition to stronger competition in international market, inter - country grouping, which also tends to increase market protectionism and discrimination that can hamper domestic product marketing and push up unfair competition.

Under the latest survey of World Economic Forum regarding global competition power, Indonesia was ranked among the world's most competitive country even within the circles of the New Big Emerging Market. The World Economic Forum has concluded that Indonesia's rank has been gradually improving and rising amidst the competitive world. Evaluation of competitive power by World Economic Forum is based on 8 criteria, they are:

a. Economic openness to international trading and financing system;

b. Role of Government's budget and regulation;

c. Development of financial market;

d. Quality of Infrastructure;

e. Quality of Technology;

f. Quality of business management;

g. Flexibility of main labour market;

h. Quality of Politic and legal institution.

On the 8 factors mentioned above, Indonesia with some deregulation policies is able to create added value and to improve its national welfare. In actuality, Government is able to decrease high cost economy and increase efficiency of worker performance of government body. Indonesia's success in increasing its competitive power is its consistent attitude in performing development based on well - planned development.

Indonesia's national development is performed steadily in the long term plan (25 years) and medium term plan (5 years), by effectively utilizing all of its national resources to realize national development goal.

One of the bases in national planning and development is utility principle, which means that all of efforts and activities of national development shall be: to give maximum advantage for human's life, to people's welfare, and develop its individual citizen while giving priority to its culture's noble value and conservation of living environment's function, within the framework of sustainable and continued development.

The dominant factor which becomes the basic capital of national development is its wide territory and its strategic position which is located in equator at cross boundary between two continents and two oceans with its natural condition having various comparative advantages.

In its implementation, more increasing development needs increasing cost that can not be fully funded from domestic source. Therefore, overseas fund is needed as complimentary to domestic capital.

The role of domestic capital and foreign capital fund are pushed to stimulate economic growth and distribution, increase society's active role in economic activity, and expand business and employment opportunities. More attractive business and investment incentives are continuously developed among others by providing adequate economic means and infrastructures, supportive rules and regulations and simplifying investment procedures as well as issuing a right macroeconomic policy.
Economic and political stability and attractive business climate has push in capital investment.

Monetary depreciation which is shaking the world recently, in fact, do not affect domestic (PNMN) and foreign capital investment (PMA) investors' interest toward Indonesia. It is caused by the long and medium term of investment, and investor's confidence on Indonesia's future economic prospect.

Monetary depression which causes currency crisis does not make confidence crisis in sector of investment, especially in Indonesia. Generally, investors think that fundamentally Indonesia's economy still opens and has attractive prospect in the future. Average economic growth of Indonesia still reaches a rate of 7% per annum with GNP of US$ 1,000 per annum.

The blessing that can be taken from this post monetary depression is a conclusion that the most profitable investment at present is export oriented investment, as its opportunity is increasing. Even though, production cost of Rupiah will rise, however its selling price in USD has high value. Furniture export potential from Central Java, or tourism supporting handicraft from Bali for instance, have a big opportunity as overseas investor are still interested in them so is the opportunity in agro-industry sector.

Indonesia upbuilds small-and-medium-scale industries including home industry and other traditional industries, so they can become self standing and more efficient business. And therefore, it is expected to increase people's income, and offer employment opportunity and increase their role in preparing goods and services and components, either for domestic or overseas market. Development of small-and-medium-scale industries are given incentives either in capital, permit or its marketing, in addition to their involvement with big scale industries, and are also increased by establishing a mutual benefit cooperation through partnership pattern.

Development trend of handicraft export in Bali for instance, describes a good prospect for craftsmen of tourism supporting small industries. During the last two or three years recently, the craftsmen prestige has raised as they have established relationship as exporters when they begin to get in touch with cross continent business. Their business relation pattern generally is the same and began when foreign tourist visited Indonesia and interested in building business with them. With foreign tourist's purchase order, export opportunity opens for craftsmen which before only acting as supplier for big art shop.

Actually the so-called foreign tourist herein, can not be said as pure tourist because they do business trading even though not in a big value. Generally, they are tourist with short time visit who comes to Indonesia by using Free Short Visit Visa facility (BVKS) or Business Visit Visa (VKU). Seen from Immigration view, holder of BVKS facility or VKU facility to perform trading transaction is not acting against the law. In addition to sales - purchase transaction they are also permitted to do field visit to negotiate merchandise which will be traded in export - import business. There are other Immigration facilities given to them to perform business activity, but not to work. In addition to Immigration factor, Indonesia's infrastructure has been enough available to support business and tourism activities. For instance, transportation infrastructure with smooth roads connecting up to countryside is available, the success in electricity program in 1990s has also contributed to market mechanism to reach its target.

However, the challenging points faced in those effort are funding obstacle, human resources and technology which is still traditional in nature. Being small entrepreneur they are, when faced with big order are not able to meet it. Therefore investor's role to process primary commodity using high technology in order to increase its added value is highly needed. That sector require more foreign investment because of their wider marketing reach as well as bigger capital financing and technology mastery.

In developing production techniques, it applies progressive manufacturing production plan in order to ensure continued and focused technology transformation. More advanced production technical development of goods and services in abroad needs to be followed, studied and understood by effort of adjustment, skill improvement and work achievement.

Government keeps pushing on production technology mastery in developing industry including engineering and design capabilities in order to ensure goods and service of better quality and to be capable to compete in overseas market.

back to TOP back to TOP

| R e s e r v e | R e s e r v e | R e s e r v e |

Copyright © 1996 - 2003