Bali Beats the Blues: Investment Up by 31%
LEGIAN ~ Bali has beaten the global financial blues – at least on the investment figures for 2009, released this week. They show that Bali remained an attractive place for both domestic and foreign investors with investment rising by 31 percent, from Rp10.4 trillion (US$1.1 billion) in 2008 to Rp13.7 trillion ($1.4 billion) last year.
The tourism sector again led the field. But the news came along with renewed pressure to direct much more investment into North Bali, which would ease the development pressure in the south and bring more of the benefits of tourism to the north and other parts of Bali.
In 2009 investment value was again dominated by domestic investment, worth Rp10.5 trillion, followed by Rp3.1 trillion in foreign investment.
Bali’s investment board also recorded that the value of last year’s investment in Bali reached Rp1.26 trillion, Rp35 billion from domestic investment and Rp1.2 trillion in foreign investment.
The investment generated 2,340 jobs.
“It’s quite surprising that investment in Bali has continued to increase despite the global financial crisis,” investment board head Nyoman Suwirya Patra said this week.
In the first three months of 2009, when global fear over the American-led slump was at its peak, the board received no applications for investment permits due to the impacts of the global credit crunch.
But this year the board is targeting Rp 3.21 trillion in new investments.
The new investments are expected to spur Bali’s economic growth to hit 5.66 percent, higher than last year’s growth of 4.7 percent.
Suwirya said the board was optimistic the target would be reached.
“We hope there will be no major obstacles in reaching the target, although we have heard of a second global financial crisis.”
The tourism sector will continue to dominate this year’s investment, while other sectors including agriculture will remain sluggish.
“Investment in tourism remains high as it provides a faster return of profits than other sectors,” he said.
According to the board’s data on investment permits, most investors still prefer Bali’s southern area to start their businesses, at least for the next five years.
“Although the southern areas of Bali are crowded with tourist businesses, the fact is that investors keep looking for opportunities there,” Suwirya said, adding that it could be because the island’s international airport is located in the south.
He said the investment board was upbeat it would attract new domestic and foreign investors in the northern part of Bali, including in Batu Ampar, Buleleng.
The area is expected to be developed as an attractive coastal spot.
People are discouraged from investing in agriculture and plantations because of the high price of land, as well as unpredictable environmental factors.
“Investors prefer to go to Kalimantan or Sumatra for agriculture or plantation projects, since the two islands still boast wider plots of land,” he said.
Al Purwa, head of the Bali branch of the Bali Indonesian Tour and Travel Agents Association (Asita), said the association encouraged more agents to promote tourism in the northern part of Bali to offer tourists a new experience of the island.
He said that most of the tourists who visited Bali had done so several times.
“Therefore, we hope that travel agents can be more creative in promoting new routes, not only to offer tourists new experiences, but also to accelerate development in northern Bali,” he said.
The Bali Statistics Agency reported this week that there are 145 star-rated hotels in Bali, 80 percent of them in Badung in the south, centre of Bali’s booming tourism-led economy.Filed under: Headlines