Impact on tourism

Hotels slash prices amid cancellations

Officials say crisis will hit Indonesia's tourism industry hard

The Ayodya Resort Bali, in the island's upscale enclave of Nusa Dua, is already feeling the impact of Mount Agung's volcanic rage.

Mr Iman Ardiansyah, an executive at the hotel, said the resort has lost about one billion rupiah (S$100,000) from the cancellation of rooms and events.

To help guests stranded by the closure of Bali's Ngurah Rai International Airport, the hotel was giving discounts of up to 20 per cent, he told The Straits Times via Facebook Messenger.

Mount Agung's ongoing eruption is likely to hit not just Bali but also Indonesia's tourism industry hard, said officials.

Each month, about 600,000 foreign tourists visit Bali, which is Indonesia's No. 1 tourist destination.

The Indonesian Hotel and Restaurant Association's Bali chapter estimates that the industry loses 13 million rupiah each time a tourist makes a cancellation.

  • 600k

    Number of foreign tourists who visit Bali every month.

Some industry officials also do not expect Indonesia to hit this year's target of 15 million foreign tourist arrivals.

Stranded tourists are being given assistance to leave by land and sea, or offered room discounts if they want to extend their stay, said Mr Bagus Sudibya, chairman of the board of advisers at the Bali chapter of the Association of the Indonesian Tours and Travel Agencies.

"For guests who need to leave urgently, they are being assisted to cross over to Java by ferry and then fly home from Surabaya airport (in East Java)," he told The Straits Times. The trip takes 10 to 12 hours.

Another option, which has been provided by some hotels, is to offer guests a generous room discount for the first day of their extended stay "to express our empathy", said Mr Bagus.

Mr Didien Djunaedy, chairman of the Association of the Indonesian Tourist Industry, told The Jakarta Post that the government would likely see a 20 per cent to 30 per cent shortfall in its target of 15 million foreign tourist arrivals this year.

Meanwhile, Tourism Minister Arief Yahya said that, at best, Indonesia might achieve 95 per cent of its foreign tourist target by the end of this year.

"(This is) a hard time for tourism in Bali, Lombok and Indonesia," Mr Arief said. "Bali is like our main (tourism) product. And then came this natural disaster."

Mount Agung rumbled back to life in September, forcing 140,000 people living nearby to be evacuated. Some of the islanders returned to their homes last month when the alert level was lowered.

According to official estimates, the major evacuation cost Bali at least US$110 million (S$150 million) in tourism and productivity losses.

A version of this article appeared in the print edition of The Straits Times on November 29, 2017, with the headline 'Hotels slash prices amid cancellations'. Print Edition | Subscribe