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Seeking Consensus to Curb Baliís Building Boom

Hotel and Restaurant Association Demand to be Consulted Before New Permits Issued for Accommodation Projects in Bali

(9/9/2012) The chairman of the Bali Chapter of the Indonesian Hotel and Restaurant Association (PHRI-Bali), Cokorda Oka Artha Ardana Sukawati (Cok Ace), has warned that the uncontrolled building of new hotels is certain to lead to oversupply, and aggressive and unhealthy price competition.

Quoted in Radar Bali, Cok Ace said, “I am certain that the increase in rooms will eventually ruin Bali’s reputation as a tourism destination.” He complained that the PHRI has not been involved in supervision of the application process for news hotel when, in fact, the organization is charged with ensuring that the quality and sustainability of Indonesia’s accommodation industry."

He also insists that it is the responsibility of regional governments and municipal governments to work together with the PHRI in moderating the granting of new hotel permits.

Addressing widespread calls for a moratorium on new hotels in Bali, Cok Ace said any moratorium must be selective in its application. He said some hotel projects being built only serve to siphon off Bali’s energy by despoiling culture and agricultural lands, with, in some instances, new accommodation projects serving as fronts for money laundering activities.

Because of this, officials need to scrutinize each new hotel project, logically evaluating the actual size of an investment, the proposed rate to be charged for rooms and projected returns on investment. Hotels that are not viable economically should not be given permits.

Cok Ace said he hoped the government would follow the example of Gianyar, where the PHRI is involved in new hotel investment decisions.