|
Indonesia looks to tourism
|
 |
January 19, 1998: 2:04 p.m. ET
But efforts to rescue faltering economy with vacationers find little success
From Correspondent Casey Wian
|
NEW YORK (CNNfn) - With its currency sharply devalued, Indonesia has high hopes that bargain-hunting tourists will rescue its faltering economy - so far without much success.
Indonesia's government wants to make the $6.5 billion-a-year tourism industry the number one source of overseas currency income by the year 2005. Currently, it ranks third behind oil and gas and textiles.
But efforts to attract as many as 400,000 additional visitors to Indonesia in the next six months have been hurt by well-publicized reports of smog from last year's fires, two plane crashes and recent riots over food prices in some small towns. While none of those problems actually reached the island destination of Bali, many potential visitors have been scared off.
In addition, more than half of Indonesia's tourists typically come from other Asian nations, which are experiencing economic problems of their own.
With the prices of goods, services and food down about 70 percent in U.S. dollar terms, Indonesia's national airline Garuda and travel agents are now trying to lure Asian visitors with package deals priced in rupiah.
At Bali's Four Seasons hotel, for example, where villas normally start at $550 a night, business is down nine percent and the hotel has extended a 35 percent promotional discount package because of the financial crisis.
But many tourist and business hotels continue to charge in U.S. dollars, reluctant to cut rates or charge in rupiah, fearing long-term damage to business.
"While Indonesia's rupiah has devalued, so has the Thai baht, so has the Malaysian ringgit. Because in those countries they're quoting hotel rates in their local currencies, whereas Indonesia quotes in U.S. dollars, we have a lot more competing factors," said Eric Kwan , sales director at the Four Seasons Resort.
|
|
|
|
|
 |
|
