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Bali as a Cheapening Destination

Moratorium on New Rooms in Bali Needed to Stop Baliís Decline into a Cheap Destination

(4/14/2014) Bisnis Bali has published a page-one article examining the impact of Bali’s continuing failure to impose a moratorium on new hotel building and curb the growingly critical oversupply of hotel rooms.

The secretary of the Indonesia Hotel and Restaurant Association (PHRI) Denpasar branch, AA Ngurah Adhi Ardhana, tells of how hotel rooms that once sold for Rp. 300,000 (US$26) a night are now being sold for Rp. 199,000 (US$17.30) a night – all due to the massive oversupply of hotel rooms in Bali.

Ardhana blamed the failure by the government to impose a moratorium on new hotel building put forth by Bali’s governor as causing the uncontrolled growth in new accommodation, declining occupancy rates and lower room rates.

And while arrivals to Bali have increased from year to year, any increase in visitors has been outstripped by an even faster growth in the number of new rooms coming onto the market.

For this reason, Ardhana argues, a moratorium on new hotels in Bali must be quickly and firmly imposed.

Ardhana is suggesting that those wishing to invest in hotels in Bali be encouraged to form partnerships with established accommodation providers who lack the capital needed to upgrade and modernize their existing businesses.