Indonesia stands to lose $4 billion in earnings from tourism if its worst-case scenario materialises and travel from China is disrupted for the whole year by a virus epidemic, the tourism minister said on Thursday.
Leading tourist destination and Australian favourite, Bali, had already seen around 10,000 cancellations by the end of last month, according to the Bali Tourism Board.
“We had two million (Chinese) visitors last year with an average spend of $1,400 per arrival,” Wishnutama Kusubandio told a news conference.
“With the negative trend seen in tourists from other countries, the loss would be even more significant. We will lose $4 billion.”
A worker walks at an empty waiting-room of a water sport attraction provider in Tanjung Benoa, Nusa Dua, Bali. Image: Reuters
The minister said he was extrapolating numbers for the whole year, despite uncertainties surrounding the virus, because bookings for summer holidays, which have usually started to trickle in by now, have been low.
Indonesian authorities have said they expect little overall economic impact despite the hit to tourism, pointing to the industry’s relatively small contribution to the economy.
Travel and tourism accounted for only 6% of Indonesia’s GDP in 2018, the World Travel and Tourism Council said.
Frederico Gil Sander, the World Bank’s lead economist for Indonesia, told a forum with foreign correspondents recently that although 10% to 15% of total tourists coming to Indonesia are from China, tourism’s share of the economy is small.
Are cheaper deals to Bali and beyond on the way?
A worker sits as he waits for tourists at a water sport attraction provider in Tanjung Benoa, Nusa Dua, Bali. Image: Reuters
If the proposed losses due to Coronavirus continue to Indonesian tourism, we could see a flood of inventory and travel deals to match hit the market in Australia and New Zealand in the coming weeks.
“The Indonesian government has encouraged airlines to discount fares for routes to Bali, the tourist island of Bintan south of Singapore and Manado city in North Sulawesi to attract visitors from outside China”, said Adita Irawati, a transport ministry official.
Indonesia and specifically Bali is still the number two destination globally after New Zealand for Australian outbound visitors, with 1.3 million Aussies travelling to the holiday isle in 2019, a rise of 10.7% versus 2018.