Is Bali losing its allure? There have been several reports this year already that indicate the island has seen the number of foreign visitors retreat to levels not seen for several years

Is Bali losing its allure?

There have been several reports this year already that indicate the island has seen the number of foreign visitors retreat to levels not seen for several years. -Jakarta Post/ANN

Chris O’Connor
Wed, Mar 20, 2013
The Jakarta Post/Asia News Network


The Tirtha Empul Temple in Bali draws tourists who seek its holy waters.

BALI – There have been several reports this year already that indicate the island has seen the number of foreign visitors retreat to levels not seen for several years.

Specific groups, such as Chinese and European visitors, have been highlighted and a variety of explanations offered as to why.

Certainly the cafes and restaurants do appear quieter than normal and even the steady stream of domestic bus tours seems reduced.

Analyses of relevant data are very important if any industry is to develop its market and adjust its planning and policies accordingly, and statements made by key players within the sector can be taken as a measure of understanding of both businesses and the administration.

For example, regarding the huge drop in Chinese arrivals reported in January 2012, when compared to the previous year, Eddy Sanyoto, owner of a travel agency dealing mainly with the Chinese market, stated that heavy rain and storms in Bali throughout January had reduced Chinese interest in visiting Bali, as reported in Bali Daily recently.

This was echoed by many others within the administration and sector.

Whilst for a small minority of last minute travelers this might be true, the reality is that most Chinese come as groups and all travel is arranged well in advance. The reasons put forward are, therefore, weak and have little or no substance.

The theme has been taken up by others, who suggest that Bali’s inherent problems with congestion, pollution, inflated prices and corruption are to blame.

Again there may well be some truth in this statement, but unless the low arrival numbers continue, it really has little basis.

The simple and obviously overlooked reality is that the Chinese New Year occurred in January in 2012 and in 2011 it was in February.

Taking the February 2011 statistics as a comparison, the trend is the same with a huge drop in Chinese visitors.

This point may seem somewhat trivial, but to planners and policymakers understanding trends is key to making reasonable predictions.

It is after all the predictions and the statistics produced that have a major influence on investment in Bali and daily revenues.

In another report, the reduction in the number of European travelers was discussed, where, recognising the risk of losing a vital group of tourists, Putu Winastra, deputy chairman of the Bali branch of the Association of Indonesian Tour and Travel Agencies (ASITA) said; “In the last five years, many European visitors have lodged complaints over the worsening environmental condition of Bali – lingering traffic jams, garbage, as well as the rising cost of hotels and accommodation facilities here.”

It would be difficult for any sensible human to disagree with the points raised by those who complained.

The situation has deteriorated significantly over recent years and, probably worse, there seems to be little, other than lip service, being done to deal with the issue.

Indeed, many observers would argue that some of the solutions, such as the over-water road link, are actually adding to the environmental catastrophe and, with a high toll likely, will be little more than a white elephant.

The environmental negligence in Bali is shocking in places. Quite often it has very little to do with the tourism sector, although of course this is usually where the blame is laid. The administration and many businesses are not just failing to take enough responsibility but often seem to miss the point totally.

Putu went on to say, “The distance factor and limited airline services are among the crucial obstacles for many travel agencies to attract European guests to Bali.” The sheer magnitude of this lack of market understanding would be laughable, if it was not so tragic. Sooner or later many tourists will look elsewhere, a fact seemingly lost on many on the island.

Bali is at a pivotal point in its development. The path it takes will determine the medium and long term viability as a tourist destination and with it the economic and cultural future of its residents. For some, it will most likely always be a place to come and let off steam. Similarly for those seeking to cleanse their inner self, the attraction will remain irrespective of the condition or price.

In short, there will always be tourists. But with the opening up of new, cleaner, cheaper and more environmentally aware destinations throughout the region, the challenge for Bali is not only how to maintain its growth, but more seriously how to retain its core visitors.

This challenge applies not only to international tourists but also to the lucrative and growing higher income domestic traveler, who like his European counterpart is beginning to expect more.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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