Amid an expected upswing in tourism arrivals in Indonesia, the country is making efforts to entice foreign investors for hotels and beach resorts, eyeing mainly potential developers from Gulf Cooperation Council nations such as Saudi Arabia, UAE and Qatar.
This was what Alwi Shihab, Indonesian Special Envoy for the Middle East and the Organisation of Islamic Cooperation (OIC), told a press conference in Bandung, capital of Indonesia’s West Java province, on January 28.
He said that “several Middle Eastern countries” had already expressed their interests to develop Indonesian beaches in order to create “large luxurious resorts” and tap into the potential the country has especially for Muslim holiday makers as it seek to position itself as an alternative for Muslim tourists many of whom keep travelling to non-Islamic destinations in the region.
He noted that Saudi Arabia already made an example by committing to invest around $100mn in a huge island resort in the Maldives, another Muslim nation with huge tourism potential. In 2014, Riyadh-based Best Choice Real Estate Development announced that it plans to develop a seven-hectare tourist resort in the Laamu Atoll in the Maldives to be opened in 2017, promising more lucrative investment opportunities for Saudi investors in the island nation. At the same time, Saudi Arabia pledged to grant the Maldives government a five-year loan facility for infrastructure and education, to build a new suburb north of the capital Male on reclaimed land and develop a special economic zone on the Maldives’ northernmost atoll, encompassing a port, airport, commercial and financial centres, a yacht marina and tourism facilities.
For Shihab, this could be a role model for Indonesia, starting with beach developments.
“Middle East investors want to make bigger tourist developments than in the Maldives. But they are having difficulties to find large enough land,” he said.
He suggested beach areas in West Java, surrounded by mountains and not far from Jakarta, but also locations outside of Java including Tanjung Lesung, Belitung, Padang, Selayar and Lombok, all of them lesser known tourism destinations in Indonesia that are predestined for beach resorts but have to catch up with infrastructure development.
Halal tourism has being recognised as “an opportunity market” for Indonesia, inspired by its neighbour Malaysia’s success in attracting Muslim travellers by offering halal holiday products, including family-friendly resorts, halal food and prayer facilities. But while Malaysia has managed to attract millions of Middle Eastern visitors, Indonesia was only getting around 200,000 last year, or around 3% of total visitors.
To improve the numbers, Indonesia in a first step is now positioning the island of Lombok as a Muslim-friendly destination, according to Tourism Minister Arief Yahya. Aceh and West Sumatra will be touted as a role model for Muslim-friendly destinations in Indonesia, he added, with Saudi said to be interested in establishing representative Shariah travel agencies in West Sumatra and the UAE in West Nusa Tenggara, an island group east of Bali that includes Lombok which has been dubbed as the “island of 1,000 mosques.”
Overall, the Indonesian government expects to generate $12bn in revenue from 12mn foreign tourists visiting the country in 2016, up 20% from last year. In 2014, Indonesia attracted 9.44mn foreign visitors.
During the World Halal Travel Awards 2015 held in Abu Dhabi last October, Indonesia bagged three awards in halal tourism for the Best Halal Tourist Destination and the Best Halal Honeymoon Destination being Lombok and the Sofyan Hotel in Jakarta being the best family-friendly hotel.
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