Batam Tourist Industry Facing Hard Times: North Sumatra

A drastic decline over the past several years in tourist arrivals, particularly from neighboring Malaysia and Singapore, has left the tourism industry in Batam, Riau Islands province, struggling for survival.

At least five star-rated hotels and dozens of entertainment establishments have closed down between 2004 and 2006 according to Fadli in Sumatra.

One of the main reasons for the drop in tourist arrivals is believed to be the closure of illegal gambling dens on the island, in addition to a slowing of foreign investment in Batam.

Though there are no official figures from the Batam Tourism Office or related agencies, based on observations but several tourism-related establishments are no longer operating.

Among the establishments that have gone out of business are
the Maxim and Crown karaoke parlors, the Bahari III and Gajah Mada lodgings, the three-star Sahid Rasinta, Oasis and Nan Tongga View hotels, the Apollo and Ozon discotheques and the Queen Bass and Sensasi massage parlors. A number of shopping centers have also closed down, including Carnaval Mall and Batam Indah Plaza.

Thousands of workers have lost their jobs due to the closures, and new job opportunities on the island are scarce.

Entertainment centers that once bustled at night are deserted. Several buildings that used to house discotheques now appear abandoned and the weeds have begun encroaching.

According to government data, the number of tourist arrivals to Batam in 2004 totaled 1.52 million. That figure declined to 1,005,000 in 2005 and below one million in 2006.

The drop in tourist arrivals was triggered in large part by the crackdown on illegal gambling and the shift of foreign business operations from Batam to other countries.

Twelve foreign investors shut down their factories between 2004 and 2006. The closure of a foreign company is usually followed by the closure of smaller local companies that provided support services.

In a sign of the downturn in the tourist sector, the Batam chapter of the Indonesian Hotel and Restaurant Association (PHRI) has been idle for the past two years.

“We got tired of wasting our time on organizational matters. Every proposal, demand and recommendation we submitted to the provincial and central government to spur tourism in Batam was ignored,” said former PHRI treasurer Anas, who also manages the Hotel Novotel Batam.

Batam municipal secretary Agussahiman said the closures of a number of tourism-related businesses, such as hotels, bars and shopping centers would have an impact on the city’s economy.

“However, I don’t know which establishments have closed down because there are no reports coming in. If it’s true they have stopped operating, the city’s revenue will be affected,” said Agussahiman.

Batam Tourism and Promotion Board head Rahman Usman said many factors had contributed to the lull in the tourism industry.

“The operating ban during the fasting month of Ramadhan does not help, nor does the gambling ban. These matters need to be reviewed or Batam will become a ghost town in the near future,” he said.

Rahman predicted the tourist industry in Batam would last for another 10 years at most if action was not taken immediately to revive the sector.

Article: Fadli