The Jokowi Administration has an ambitious proposal. They plan to welcome 20 million foreign tourists to the country in 2019. That's a significant increase on the 12.7 million visitors who arrived in 2017, a figure which was already up by over 14% on 2016, despite the disruption caused by Bali's Gung Agung to the country's most popular destination in the last two months of the year.

If realized, this would make tourism the country's top foreign exchange earner.

For this to become a reality there needs to be substantial investment in infrastructure and tourist facilities. An estimated USD 20 billion to be more precise.

The Indonesian government however, can only contribute to infrastructure development such as roads and ports. The lion's share of the USD 20 billion needed is for tourism facilities such as hotels, restaurants, shops, bars and parks, which it is hoped will be generated from the private sector.

The plan is already underway. The government created the "10 New Balis" concept in 2016 identifying ten priority tourist destinations with the greatest tourism potential.

Hiramsyah Thaib, Team Leader of Acceleration for the Development of Priority Tourism Destination at Indonesia’s Tourism Ministry, said a couple of priority destinations have already managed to attract a significant amount of investment.

Lake Toba in North Sumatra for example, already has several projects under construction with a combined value of IDR 1 trillion (approx. USD $75 million).

Mandalika on the island of Lombok is another. An estimated IDR 13 trillion (approx. USD $977 million) worth of investment has poured in so far. But as Invest Islands points out Mandalika was declared a Special Economic Zone (for the agro and ecotourism industries at least), implying investors would enjoy fiscal incentives to invest in this area if they were planning to roll out sustainable eco-friendly initiatives.

The opportunities and potential are enormous. Thaib added that investors from several countries have showed interest in projects related to the ten priority tourist destinations including China, Singapore, Malaysia, Japan, the Middle East, and several European countries.

Sources: Invest Islands, Indonesia Investment, Trading Economics

This article was previously published on Gapura Bali

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