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Bali Tourism Investments Dominated by Hotels and Resorts

Provincial Investment Board Gives Green Light to New Hotels Despite Objections by Tourism Board and Governor.


Bisnis Bali estimates that the value of new investments in hotels and recreational facilities in Bali for the period January – November 2007 reached Rp. 1.4 trillion (US$152.2 million) comprised of 38 projects.

70% of the new investment in Bali is centered on the hotel and resort sector.

According to research conducted by the Surabaya branch of Bank Central Asia (BCI), most new hotel investments in Bali are located on elevated or beachside areas in Jimbaran, Pecatu, Ungasan, Payangan, Sanur, Legian and Kuta.

According to Aslakhul Umam, Research Coordinator at BCI in Surabaya, following the second Bali bombing in October 2005 the Island has undergone a significant increase in new resort and hotel investments, with most investors coming from areas outside of Bali, such as Jakarta and Surabaya. "In any case, the nature and views of Bali remain interesting for those seeking investments in the tourism sector," explained Umam.

Shown on are some of the new hotel and tourism investments slated to open in 2008 in Bali.

Bisnis Bali reports that officials in the Badung and Denpasar regions of Bali remain receptive to new investment applications in the hotel sector, denying earlier reports that new hotels would be banned from commencing new projects.

The Chairman of the Coordinating Investment Board for Bali (BKPMD-Bali), Drs. Made Kandiyuana, stated: "The Provincial government of Bali has never said that Badung and Denpasar are closed to new hotel investments. What is correct is that we have been asked to be more selective. But, as long as new projects do not violate zoning rules and pass a review by our study team, they will approved."

The BKPMD Chief's green light for new investments is at seeming odds with an earlier pronouncements by Bali's Governor who once issued a memorandum freezing new hotel investments.

Kandiyuana also told the press that his office was moving towards the goal of providing a "one-door" service for the approval of new investment projects and improve their service to the public.

A Call for Greater Openness

In a related article in BisnisBali, the Bali Tourism Board (BTB) has called on the government to adopts a more open approach to the issuance of investment licenses and permits.

The Chairman of the BTB Ngurah Wijaya, complained that his organization has never received data on the number of hotel permits issued in Bali. This lack of openness, unfortunately, lends itself to suspicions of corruption and collusion in the license process.

Wijaya said that with more than 350,000 hotels rooms in Bali and the recent rapid increase in commercial villas suggest that new permits should be frozen for the time being.

Wijaya said that instead of new hotels the government should turn its attention to the management of tourism objects.

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