BALI (BLOOMBERG) - Bali, the hardest-hit economy among Indonesia's provinces last quarter, is seeing a pick-up in activity as its governor continues debating when and how the island can reopen to international travellers.
The province saw its gross domestic product shrink 12.28 per cent in the third quarter from a year ago, the worst contraction among Indonesia's 34 provinces, even as domestic tourists were allowed to return in July.
Its shores remain shut to foreign arrivals as the island scrapped an earlier plan to reopen in September due to a resurgence in coronavirus cases.
The local government is focused on containing the spread of infections and increasing the recovery rate while continuing to weigh a reopening to foreign tourists, said Bali Governor Wayan Koster.
"The government will take views on many aspects to avoid taking a counter-productive policy," he added.
Indonesia is grappling with the largest coronavirus outbreak in South-east Asia with more than 457,000 confirmed cases so far, a nearly 60 per cent increase since the end of September.
The pandemic has sent the economy into its first recession in more than two decades after two consecutive quarters of annual contraction, with Bali and its tourism-reliant industries bearing the brunt.
Bali's beaches, resorts and temples are usually busiest during its May-September dry season that coincides with winter in Australia and summer break in the northern hemisphere.
This time, only 152 foreigners visited Bali in the three months through September, a stunning drop from 1.8 million last year, according to the statistics office. Domestic air passengers also fell 90 per cent from 2019.
There are signs of a turnaround.
The island saw a surge in holidaymakers during a long weekend at the end of October, which lifted occupancy at luxury hotels to 30 per cent that week, from an average of 9 per cent since Bali started welcoming domestic travellers, according to Mr Ricky Putra, chairman of Bali Hotels Association.
Two weeks after the holiday break, Indonesia posted a record spike in new coronavirus infections on Friday (Nov 13).
The government has exempted airport tax for 13 airports in the archipelago to boost domestic travel, including Bali's. Flag carrier PT Garuda Indonesia has also seen a revival in ticket demand toward the year-end with an increase in advance booking, said President Director Irfan Setiaputra.
"I do hope that in December we will see an increase in domestic tourist arrival in Bali as an initial momentum for the recovery of Bali's tourism," Governor Koster said.