INDONESIA´s HANDBOOK 2000

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CONTENTS

FOREWORD
LAND
PEOPLE
HISTORY
GOVERNMENT
DEVELOPMENT ACHIEVEMENTS
Economic Recovery
People's Welfare and Poverty Eradication
Food and Horticulture
National Logistics Agency
Investment
Agriculture
Industry and Trade
Mining and Energy
Cooperatives, Small and Medium Scale Enterprises
Transportation and Communications
Transmigration
The Law
The Environment
Defense and Security
Health
Social Affairs
Manpower
The Role of Women in National Development
Population and Family Planning
Religious Life
Education and Culture
Science and Technology
Housing and Settlement
Agrarian Affairs
The Younger Generation and Sports
Tourism, Arts and Culture
Empowerment of State Enterprises

TOURISM, ARTS AND CULTURE

The concept of Tourism, Art and Culture is based on the concept of the Indonesian life, which is balance between human beings and the One and Only God. So far, the variety of totirism products are based on natural and cultural resources. Presently tourism product is based on science and art without neglecting the balance between human being touch and high technology.

In the framework of supporting national development of tourism, art and culture, up to now 35 societies of care for tourism, art and culture in 25 provinces have been founded. This society acts as a medium of nourishment, development and poten-tial of the community including artists and culturalists.

One of the potential tourist attractions to be developed is the utilization of the Borobudur Temple as one example of esca-lating culture, heritage of the Buddha religion. In addition, to shorting important values from religious and historical side, the Borobudur Temple has a unique and monumental architecture. By the grace of God Almighty, Indonesia has one of the seventh World Wonders in the form of the Borobudur Temple.

Up to now, there is 116 tourism regions which scatter throughout the country with one region has been fully operated, 9 regions have partially been operated, 8 regions are under con-struction, and 83 regions are still on planning. So far, 458 tourist destinations and tourist attractions have been identified and enhanced. While, the 'number of accomodation in Indonesia up to 1998 was 9,608 units with 232,223 rooms, consisting of 82,498 rooms in 810 star-rated hotels and 149,725 rooms in 8,798 non-star hotels.

Meanwhile, the number of foreign tourists visiting Indonesia in 1997, amounted to 5.185,243 visitors or an increase of 2.99 compared to that in 1996 of 5.034.472 visitors. While, in 1998, the number declined to 4.606.416 visitors of 11.16% compared to that in 1997. Yet, from January to April 1999 the number of foreign tourists visiting Indonesia showed an increase of 5.23% compared to that  in 1998 in the same period.

Foreign exchange earning decreased from US$5,321.46 million in 1997 to US$4,331.09 million in 1998 or a 18.6% decrease. In 1998 the number of domestic tourists was 109.75 million persons who spent 13.5 trillion rupiahs. Compare to that in previous year, the number of domestic tourist decreased by 1.35%.

A R T S

Art forms are not only based on folklore. Most of them have developed in the courts of former kingdoms so that, like in Bali, they have become part of religious ceremonies. The famous dance dramas of Java and Bali are derived from Hindu mythology and often feature fragments from the Ramayana and Mahabharata Hindu epics.

Puppets of the wayang kulit shadow play are made of intricately carved and colorfully painted leather, while the wayang golek puppets are made of the light but strong arbasiah wood and dressed in batik wooden puppets. Both the wayang kulit and wayang golek theaters are operated by the dalang (puppeteer) who manipulates the puppets and makes them "speak" in different voices and accents according to character age and/or sex. Besides, the dalang must be at the same time a composer, improviser, producer, orator, singer, choir master, dance master and stage manager. Wayang golek and wayang kulit performances are accompanied by the Javanese gamelan musical instruments. The wayang kulit performance is very popular with the people in Central Java, while the wayang golek is generally performed in West Java.

The bamboo angklung musical instruments of West Java and the wooden kolintang of North Sulawesi are widely known. Another kind of musical instrument which is also attractive and unique is the sasando of East Nusa Tenggara. Sasando is a stringed musical instrument made of lontar leaves and is handled like a guitar.

The Bataks of North Sumatra and the Ambonese of Maluku are known for their ability to sing to the accompaniment of the guitar.

Painting

Cave paintings, for the most part, of hand stencils but also of human and animal figures, assumed to be some 5,000 years old, are found in South Sulawesi andirian Jaya. The inner walls of some megalithic graves in the Pasemah highlands, southern Sumatra, contain colored paintings dating from about 100 AD. In the 14th century mention was made of painted scrolls of fine white bark-cloth used in wayang beber, one of the oldest forms of wayang performances.

The art of decorating cloth in the batik technique is a form of painting, for the molten wax is applied on the cloth with a canting, a pen-like instrument, though the colors are provided by dyeing. Early Javanese literature even refers to batikers as painters.

The people of Central Sulawesi painted intricate symbolic motifs in bright colors on bark-cloth vestments by using vegetable dyes and bamboo brushes.

Temple hangings, streamers, curtains and traditional astrological calendars in Bali are made of painted cloth or wood.

Balinese painting is characterized by its style of filling all space, its themes which are taken mainly from Hindu religious life, mythology and legend, and the absence of time, space and perspective. The founding of "Pita Maha" in the 1930s by Cokorde Sukawati from Ubud (Central Bali) together with Dutch artist Rudolf Bonnet and German painter Walter Spies, brought a dramatic revolution in Balinese painting.

Influence by these and other Western artists, Balinese painters came to use oils and to apply the concept of colors, perspective and the third dimension, and their subjects were no longer drawn exclusively from the traditional repertory, but scenes from everyday life began to emerge.

A brilliant exponent of "Pita Maha" was Gusti Nyoman Lempad, noted for his cremation towers and ink drawings. He died in 1978 at the age of 121. Works of art from Ubud, the center of local and foreign artists, were bright and vivid in contrast to those of the "Community of Artists" in which dark and sombre colors were dominant.

The "Community of Artists" was formed in 1969 by Dewa Nyoman Batuan at the village of Pengosekan (Central Bali), the home many artists who draw their subjects from nature and Balinese daily life.

Foreign artists apart from Walter Spies and Rudolf Bonnet, who have lived and painted or are still living and painting in Bali, include Hans Snel and Arie Smit from Holland, Spain's Antonio Blanco and Theo Meier from Switzerland. The present "Le Mayeur Museum" at Sanur, South Bali, was formerly the home of the late Belgian impressionist Le Mayeur and his Balinese wife Ni Polok, once a famous Legong dancer.

Indonesian painters came to be known late in the nineteenth century after Raden Saleh earned world fame on account of his naturalistic technique in paintings of animals and landscapes and his portraits in oils. Later, other naturalist painters followed such as Abdullah Surio Subroto and his son Basuki Abdullah, a renowned portrait painter, Pringadie, Hendra, Trubus, Omar Basalamah, Sukardji, Wahdi and others.

In 1937 Sudjojono and the brothers Otto and Agus Djaja founded PERSAGI (Indonesian Painters Association) whose members sought a synthesis of traditional and modern painting while developing a style of their own which was characteristically Indonesian.  Other art groups came into being as "Seniman Indonesia Muda" (Young Indonesian Artists) and "Pelukis Rakyat" (Painters of the People). The leading man of the latter was category Affandi and artists of this group include Trubus, Nashar, Hendra Gunawan, and Sjafei Sumardja. Himself an expressionist, Affandi was said to have opened "a new way of expressionism". He was one of the few Indonesian artists to have participated in famous international exhibitions such as those of Venice and Sao Paolo.

During the Japanese occupation, Indonesian artists were recruited to make posters for propaganda. They did accept the orders and thus had the opportunity to develop their artistic abilities, and during the Revolution did not stop painting.

Since many artists had joined the guerilla warfare, their paintings consequently bear witness of those turbulent days of the revolution, like Sudjojono's "Flight" and Surono's Frontline".

In 1947 a college for art teachers was set up in Bandung which in 1951 was incorporated into the Faculty of Fine Arts of the Bandung Institute of Technology. Other steps towards promoting fine arts in Indonesia were the founding of the Academy of Fine Arts in Yogyakarta (ASRI) in 1950 and the Jakarta Institute of Art Education (LPKJ) in 1968.

Primitivism, naturalism, obstructionism, expressionism and impressionism have all been displayed in Indonesian paintings, and Indonesian artists today are developing new forms and styles by using feathers, bronze, velvet, glass, banana-tree barks, cloves, etc. Recently "batik paintings" by which oils and canvas are replaced by the ancient wax-and-dye technique, have become popular. Contemporary batik artists are Amir Sapto Hudoyo, who has a gallery of his own, Kuswadji, Bambang Oetoro and the Sumatran Amri Yahya all of them domiciled in Yogyakarta.

For the development and appreciation of the fine arts, Balai Budaya (Hall of Culture) and Taman Ismail Marzuki (Jakarta Art Center) have been founded. Named after the late poet-composer Ismail Marzuki, the Art Center has four theaters, a dance studio, an exhibition hall, a number of small studios for contemporary artists and residential units for members of the administration.

Present-day painters are Mochtar Apin, But Muchtar, Srihadi Sudarsono, Popo lskandar, Abdul Djalil Pirous (calligrapher), Abas Alibasjah, Tom Harry, Cak Kandar and Jim Supangkat. Woman painters include Emiria Sunasa, the oldest of the group; Kartika, Affandi's daughter,  Umi  Dachlan,  Sriyana  Hudionoto,  Agnes Julinawati, Nunung W.S. and Sisca Damavanti Soebvakto.

C R A F T S

Indonesian crafts as one of the art products has various styles, patterns and designs, inherited from ancestors with various cultural backgrounds. Traditional or spiritual values from many tribes are reflected in the colors, forms and typical crafts from certain regions which display various meanings related to the ethnic or particular region of origin.

Woven cloth is found all over the country, with different motifs, patterns and colors according to their respective region. The noted songket and ikat weaving are made in Sumbawa, Flores, Kalimantan, South Sumatra, West Sumatra, Bali and East Timor.

Meanwhile, basketrys are found in virtually all parts of the country, and many places in Sumatra, Kalimantan and Sulawesi are wellknown for their rattan baskets.

East Nusa Tenggara and Bali are famous for their plaiting of Iontar leaves, while Java is widely known for plait work of bamboo and pandanus leaves, in the form of baskets, bags, hats, mats, wallets and household articles.

Earthenware and ceramics have been developed more and more artistically throughout the archipelago Silverware is found in Kota Cede, Yogyakarta and Bali, while Sumatra and Sulawesi are famous for their filigree silver work.

C U L T U R E

Whilst unity has been a result of history, different cultures are based on many different ethnic groups found throughout the country which have maintained their traditions, languages and dialects. Protected by adat (customary law) which differs from one region to another, modernization is only a superficial veneer covering the daily life in the cities. Ultimately, adat is man's ties to his family and to his community and is applied to his way of life.

The Indonesian culture originated from the farming activities of the indigenous people. It was influenced by the waves of traders from India, China, Saudi Arabia and Europe which brought along their religious teachings.

Western influence arrived with the Portuguese, who came in search of spices in the early 16th century and later with the arrival of British and Dutch merchants. The Hindu cultural heritage is also found in this archipelago, such as the Ramayana and Mahabharata epics which play an important role in the Indonesian culture.
Customs and traditions which have merged with religious teachings,* have brought about different ceremonies and festivities, which vary from area to area.

C a n d i

Candi is the Indonesian word for temple, the pronunciation of which is like that of "chancy" with "a" pronounced as in "father". It indicates the numerous stone monuments from Indonesia's classical period, and some remains are still intact today, particularly in Java, Sumatra and Bali.

The Hindu monuments in Indonesia were built by some rulers during their own life-time or by their descendants to perpetuate their memory. Some statues of Brahma, Shiva, Vishnu, Agastya, Dhurga and other godheads in the Hindu panthers in the candies are, in fact, also representations, perhaps even portraits, of former deified kings, portraying the bodies of the godheads but using the faces of rulers. In some cases the historical identity of the ruler is given in inspection about the dedication of the candi in question.

Different from the other houses of worship, the Buddhist sanctuaries were built as an act of faith and in order to obtain merit. Buddhist inscription on the monuments of Central Java are that of the Mahayana Buddhism. The great Buddhist effigies of Java are all connected with the. names of Shailendra kings.

The Indonesian government has been giving appropriate attention to the preservation and conservation of historical and ancient buildings. Restoration and conservation work of the Borobudur Temple, renovation of Kedaton Temple located in former Majapahit Trowulan and Kaibon Palace Inrated in Did Ranten

M U S E U M S

Historically, due to strategic position, Indonesia had been occupied by foreign nations which brought their specific culture. As a result, many historical remains are found in several parts of Indonesia and they fill for the Indonesian people with pride while attracting foreign visitors to come to Indonesia. That is why the Indonesian Government pays great attention to the maintenance as well rehabilitation of those objects. The numerous large and small museums found in Indonesia represent a whole spectrum of the Indonesian life and history beginning from its earliest existence up to the present time.

The oldest and the country's most known museum is the Central Museum which is popularly called "Gedung Gajah," or Elephant Building, a name earned from a bronze elephant statue by King Chulalongkorn from Thailand when he visited Batavia (Jakarta) in March 1871, which is placed in front of the building. The museum, founded in 1778, is claimed as one of the finest in Southeast Asia, and houses the world's most complete collection of Indonesian artifacts.

Museums of natural history are found in Bandung and Bogor. Of equal scientific interest, though small, is the Sangiran Museum of paleontology and anthropology in Central Java. It houses prehistoric fossils found in the area, including those of the "Java Man" or pithecanthropus erectus and "Solo Man" or Homo soloensis

The Fatahilah Museum is also a fine museum in Jakarta, housing various ancient furniture and guns as remains of the Dutch colonial government. The other museums found in Jakarta are the Satria Mandala Museum (displaying the national struggle), the Textile Museum (housing all of the Indonesian well known traditional cloths such as Batik, lkat, Songket, etc.) At the Beautiful Indonesia in Miniature Park (TMII) in Jakarta, the Government built various museum such as Museum Indonesia,

Museum Prajurit, Museum of Insects, Museum of Sports, Museum of Oil and Gas, Museum of Telecommunications, Museum of Information, Museum of Stamps, Museum of Transportation, Puma Bhakti Pertiwi Museum, etc.

The Puma Bhakti Pertiwi Museum located at the left side of the TMII main entrance houses souvenirs as well as gifts received by the second President of the Republic of Indonesia, Soeharto both at home and during his visits abroad from heads of state/governments of foreign countries.

In the framework of museum enhancement, in fiscal year 1996/97 the Government erected the Surabaya's Empu Tantular Museum and La Galigo State Museum in Ujung Pandang, carried out seven mobile exhibitions as well as gave assistance to 23 private museums. In addition, the. Central Museum, as center of research, education and recreation, has been rehabilitated and completed with permanent array of exhibitions. Moreover, 12 exhibitions with specific themes have also been conducted along with the publication of folders and brochures.


Borobudur Temple, Central Java, one of seven World Wonders

A scene from "Barong" dance-drama, Bali

The deserted beach at Wane, Sumbawa Island

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.

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