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Putting Our Tourism House in Order

Leading Expert Examines Why Indonesia Continues to Get Less than its Share of the Tourism Pie.


Bali News: Putting Our Tourism House in Order
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(1/7/2008)

The former Executive Director of the Indonesian Promotion Board and a frequent contributor to balidiscovery.com, Wuryastuti Sunario, wrote the following article that appeared in the December 17, 2006 edition of Media Indonesia..

Our free translation of that article follows:

Professional Management is Needed to Improve the Competitiveness of Indonesian Tourism

Wuryastuti Sunario


It must be admitted that despite Indonesia's rich variety of cultural and natural assets, the country is is increasingly the loser in the competition for tourism arrivals among other ASEAN countries when compared to Thailand, Malaysia and Singapore.

In 1999, Indonesia attracted around 5 million foreign tourists or 14% of all tourism arrivals to ASEAN. Meanwhile Singapore garnered 21%, Malaysia 24% and Thailand 26%. Seven years later in 2006, Indonesia's share of all ASEAN arrivals has dropped to 8.6% while Singapore earned a 17.1% share and Thailand 24.4%. Meanwhile, Malaysian arrivals had leapt to a 31% market-share, making it the biggest tourism contributor in ASEAN. Total foreign tourists to Indonesia in 2006 totaled 4.8 million compared to 9.7 million arrivals to Singapore, 13.8 to Thailand and 17.5 million to Malaysia.

To remedy this, Indonesia hopes to bring 7 million foreign visitors to Indonesia in "Visit Indonesia Year 2008" and 6 million visitors in 2007.

In Presidential Instruction No. 16 of 2005, Susilo Bambang Yudhoyono instructed his Ministers, all Government agencies, Governors, Regents and Mayors to support and coordinate closely in order to support development of Indonesian tourism. However, when success is measured by the number of tourist arrivals, the success of that policy is yet to be realized.

Why is it that Indonesia has been left behind as though the country has been abandoned by tourists over the past decade?

Indonesia's tourism has faced many challenges requiring those working in the tourism industry to work very hard to overcome the multi-dimensional challenges of terrorism, earthquakes, tsunamis, bird flu and, most recently, the extension of the European Union's ban on Indonesian aviation. That ban has particularly crippled remote areas of Indonesia dependent on tourism such as Nias, Toraja, Maluku and Papua.

In late October of 2007 the World Economic Forum (WEF) published a competitive index for tourism. That index placed Indonesia at the 60th ranking, behind Singapore at No. 8, Malaysia No. 31 and Thailand No. 43.

This is the reality that Indonesia must confront. WEF's competitive index looked beyond the mere natural beauty, cultural attractions, prices competitiveness and competitive business practice of a destination.

The WEF's measure of competitiveness was based on 13 separate criteria including rules and regulations; policies for the control and development of tour and travel activities; environmental policies; safety; cleanliness; health; the prioritization of travel and tourism in national development; aviation infrastructure; tourism infrastructure; information and technology infrastructure; price competitiveness; quality and dynamism of human resources; national perceptions regarding tourism; and finally natural and cultural resources. Clearly, many of these areas are outside the immediate responsibility and control of the tourism sector.

Indonesia's ranking as 60th world-wide in terms of tourism competitiveness was statistically based and also contemplated TV media perceptions, both abroad and within Indonesia, that the Country is less than safe, dirty, unhealthy, etc. all negative factors acting as disincentives for tourists considering a visit to Indonesia.

But, to be frank, in addition to external factors, there are also internal problems plaguing Indonesian tourism's ability to be globally competitive.

A closer look at the criteria which form the basis of the WEF assessment reveals that Indonesian tourism's lethargy is grounded in the weakness of overall Destination Management and Leadership, with the Country lacking professional manpower skills at every level.

The is also an lack of clarity regarding Political Will as provided by Indonesia's Executive as well as Legislative branches who constantly espouse the prioritization of tourism development but provide only minimum funding support. As a result, Indonesia is unable to compete with neighboring countries possessing larger budgets for the development and promotion of tourism.

Of no less importance, is Indonesia's demonstrated poor communication skills with the rest of the world, both on a Government level and via its national media. Indonesia seldom counters accusations and negative news presented by the international media. As a result, negative and inaccurate news reports on terrorism, disease, natural disasters and aviation accidents in Indonesia are allowed to stand fostering international perceptions that Indonesia is not an attractive tourism destination to visit.

Meanwhile, the management clout of Indonesian tourism by the Department of Culture and Tourism has lost much of its strength through the transfer of tourism development powers to Indonesia's many autonomous regions and districts, which now number around 450. These regions have been unprepared to accept this responsibility. For example, the destination of Lake Toba (North Sumatra) is under the supervision of no less than 8 regencies. Pramaban temple is in one section part of Central Java while, on another, is part of the Special District of Yogyakarta. Similarly, Mount Bromo, the Dieng Plateau and a number of other destinations are being held "hostage" among a number of competing autonomous regions. Meanwhile, the regions in Indonesia are currently more interested in tourism as a source of local tax revenues and payments rather than in how to professionally manage their destination to meet tourists' expectations and maintain global competitiveness.

From the aspect of national management of its tourism assets, the Country is currently fragmented into hundreds of autonomous units providing uneven levels of service, declining product quality standards, and substandard security and safety guarantees to both domestic and international visitors.

It is therefore the duty of the Government together with the House of Representatives (DPR) to reconfigure the hundreds of tourism management units into a single and very solid national tourism destination called "Indonesia" that will be able to compete internationally.

Another area prompting complaints from the Private Sector who must "sell" and "service" Indonesian tourism is the growing gulf that exists between the Government and the Private Sectors. In principle, cooperation between Business and Government in tourism matters should be a partnership based on a synergetic Reciprocal Interdependence; a system of mutual dependence where the function of Government is to "promote" and the role of Business sector is to "sell." "Promotion" without "selling" will be ineffective and even wasteful. On the other hand, "selling" is rendered problematic without "promotion."

In countries with advanced tourism industries, such as Singapore, Malaysia, Australia and Korea Reciprocal Interdependence is manifested in a single national organization set up under the laws of the respective legislature. These bodies are semi-governmental, operating as statutory bodies managed jointly by the Government and Private Sector. These toursim bodies bring together expertise, functionality and, most importantly, combined public and private funding administered under a single, clean and professional management structure.

But in Indonesia the formulation of a semi-private or semi-government organization has been deemed illegal under the finance laws of the Country. Like it or not, the tourism budget


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