Country report: Indonesia

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While cruising is still relatively new to Southeast Asia, Indonesia has been enjoying the economic benefits of the sector since the 1920s. Tourism records show that in the early 1900s the majority of international arrivals to the country, particularly to Bali, were via the ocean.

Today, cruise continues to play a large role in delivering international visitors to the destination, although it’s still not as large as tourism leaders would like. Latest figures show that in 2014 Indonesia had over 9.4 million international visitors. Of that, around one million travellers were marine-related. This was more than a 100 percent increase on the 400,000 sea visitors a decade earlier.

Despite the rise, the figure is still well behind the goal of four million set for 2019. The ambitious figure was revealed by Tourism Minister Arief Yahya last month. He believes the 400 percent increase in marine visitors is achievable, particularly as the country starts to roll out new initiatives.

Among the new drivers of cruise arrivals, and tourism in general, is the extension of the visa-free policy to 30 additional countries. Initially set for China, Japan, South Korea and Russia, the Indonesian government has decided to extend the policy to 30 more countries. It will see travellers enter Indonesia (whether by land or sea) without having to pay the $35 visa-on-arrival fee.

Expected to roll out in the coming months, destinations like the USA and Canada – two of the world’s biggest cruise markets – will have access to the visa-free policy. Sea fans in the UK will also be given visa exemptions along with cruisers and travellers from other parts of Europe, the Middle East, Africa and South America.

Excluded from the visa-free policy is Indonesia’s third largest tourism market, Australia. The decision was revealed in March this year by Mr Yahya, when relations between the two nations hit a rough patch over the then planned executions of two Australians convicted of drug smuggling. The execution of the men, which took place in late April, saw some Australians turn against Indonesia and use social media as a platform to promote travel boycotts to Aussie favourite, Bali. Mr Yahya denied this was the reason for removing Australia from the visa-free policy and said “if that Australian Government wants it, then the foreign minister and president will almost definitely want it too”.

Meanwhile, despite calls from social media users to boycott Bali, airlines and hotel booking sites say Australian travellers are securing trips to Indonesia in record numbers. Alan Joyce, the CEO of Australian airline Qantas, said the airline has not experienced a decrease in ticket sales to Indonesia and doesn’t expect the executions to have a significant impact.

Online travel site Webjet’s CEO, John Guscic, concurred, saying booking habits of Australian holidaymakers rarely correlate with political events. “In this case, there has been significant publicity about the fate of the Bali Nine and it hasn’t impacted bookings to Bali over that period,” Mr Guscic said. Indonesia is a popular overseas destination for Webjet users and, according to the online travel company, there was a 37 percent increase in bookings for flights to Bali over the six months to December.

Meanwhile, when it comes to attracting more cruisers, Indonesia is joining the likes of the Philippines and Vietnam by injecting millions into new port infrastructure to cater to larger vessels. The biggest port development plan is happening in tourist favourite, Bali. The country is hoping to turn the resort destination into a major cruise hub for ships in Southeast Asia.

Ali Sodikin, general manager of seaport operator Penlindo III for Benoa port, said the aim is to expand the port so it can be used as a destination for cruise ships as well as an embarkation terminal. He’s hoping to turn Bali into a turn-around port where cruise passengers start and end their journey. This would benefit the destination economically, as cruise passengers would need to book flights as well as pre- and post-cruise accommodation on the island. “Cruises would originate from this port and return here after completing their journey,” he said.

However, locals will have to wait a couple of years before reaping the benefits of the major hub, as facility upgrades are projected to start in 2017 and could take up to 10 months to complete. Once complete, the wharf will be able to accommodate up to three ships at a time

In the Banten province, which sits on the border of West Java and Jakarta, two Indonesia-based property developers are also looking at building cruise infrastructure, with plans to construct a new $50 million cruise ship terminal and resort. Planned for a 2017 unveiling, the cruise ship terminal will be built on 40- to- 50-hectares of land and will feature 300 docks for private yachts and 300 docks for public use.

Project developer Pelabuhan Indonesia II’s president, R.J. Lino, said a new ship facility is vital to attracting more international visitors. “Jakarta currently has no facility to accommodate cruise ships,” he said. “Therefore, we see a promising opportunity to develop this terminal as an alternative gate for foreign tourists to visit the capital city.”