TOURISM PROGRESS

Jakarta as the nation’s capital is one of the main destinations in Indonesia for MICE and tourism activity. In 2020 and 2021, the number of visitor arrivals from both domestic provinces and foreign countries fell significantly due to the pandemic. However, in 2022, domestic visitor arrivals have increased amidst limited foreign arrivals.

Indonesia’s tourism market has grown rapidly in recent years, encouraging growth across a range of travel-related industries, especially the hotel sector. The tourism market has achieved healthy growth with a Compound Annual Growth Rate (CAGR) of 16%. Specifically in 2022, growth was recorded at around 19.8%, exceeding the peak performance in 2019 which reached 1.8%. Bank Indonesia has recorded that tourism contributed more than US$7 billion (Rp. 109.5 trillion) to the local economy in 2022 and  by October 2023 this figure had already reached double digits.

SUPPORTING FACTORS FOR HOTEL BUSINESS PROSPECTS

Hotel investment in the Asia-Pacific region in 2023 is predicted to slow down. In the midst of this regional slowing trend, hotel investment in Indonesia continues to grow, supported by an increase in the number of visitors as well as new hotel developments in cities with tourist attractions and MICE activity. Other factors are providing the sector with support.

First, Indonesia is one of the most popular tourist destinations in the world, with a diverse natural environment, culture, and culinary offerings. The more tourists visit Indonesia, the greater the demand for accommodation, including hotels. The government continues to encourage foreign tourist visits through various inter-country  collaborations. Second, the Indonesian government continues to improve infrastructure in various regions, including road access, airports, and public transportation. This makes it easier for tourists to visit various more remote destinations in the country and further increases demand for hotels.