Bali's long road to recovery

The Bali terror attacks hit the tourism industry hard

The tourism industry in Bali was devastated by the bombings a year ago. Now the island is looking to the future in trying to rebuild its fragile tourist sector.

One year on, tourism numbers are still down on pre-bombing levels but seem to be picking up.

Tourism, which employs around half of Bali's population, was devastated by the attack.

Beach vendors, stall owners and taxi drivers have all been affected and more and more Balinese have found themselves facing financial trouble.

And a study in June suggested that Bali residents had suffered significant falls in employment, sales and income since the attack.

But work is well under way to lure the tourists back.

"We had many initiatives, but we only began marketing early this year to allow people to get through the pain of what happened," explained hotelier Michel Kottray, general manager of the Sheraton Nusa Indah resort in Kuta, Bali

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Hotels "took to the road" attending big trade shows and slashing prices, making the destination more competitive.

"By July and August this year bookings were quite reasonable," he said, with 60-70% occupancy in hotels.

The bomb showed the degree to which tourism is important to Bali John Koldowski, PATA

That is still below the previous year however when hotels would be 80-90%. full.

"Large events - government and corporate - are helping keep the industry going, but things are still not at levels we're used to," he added.

Figures from the Pacific Asia Travel Association (PATA) show that foreign direct arrivals to Bali in the first six months of the year stood at 383,408, down 20% on last year.

John Koldowski, Managing Director of PATA's Strategic Intelligence Centre said: "As far as direct foreign arrivals go, we're still moving through a negative phase but its improving nevertheless."

He added the younger "die hard surfer types" were first to return as they had the best sense of adventure - and took advantage of cheap deals and price slashing across the island.

However, the implication of low yields, travel advisories, the upcoming anniversary of the bombing and even next year's elections in Indonesia could cause problems.

Meanwhile, the possibility of Indonesia introducing a "visitor tax" of around $20-40 early next year could also affect tourism numbers.

Chance for change?

Mr Koldowski added: "The bomb showed the degree to which tourism is important to Bali.

Its looking as though there are some signs of recovery, albeit small Thea Sinclair, Economics of Tourism Professor at Nottingham University

"There's quite a long supply chain - even two or three layers out. For example crop growers in central Java were affected."

"Can you be too dependent on tourism, well, yes you can."

He added that Bali must now take advantage of the chance to "reposition and reinvigorate" its tourism industry.

The "island of the Gods" could place itself more in tune with "cultural tourism" - with locals recreating the Bali lifestyle -but "market forces will dictate that", Mr Koldowski says.

He added: "The spirit of Bali is such that you can't keep them down, they're hurting still, but their mindset is changing."

But things could be getting better month by month.

Thea Sinclair, Professor of Economics of Tourism at Nottingham University told BBC News that the figures for July were down just 10% on July 2002.

"Its looking as though there are some signs of recovery, albeit small," she said, praising the immediate and long-term measures taken to resolve the problem.

Media coverage helped, promoting enhanced security and "humanitarian moves" such as the Balinese governor visiting the Australian victims of the attack.

Attention switch

TOURISM: BACKBONE OF BALI Sector generates 67% of island's GDP More than 80% of Bali's households depend on tourism Attracts more than 1.5 million foreign visitors a year (in normal times) Nottingham University

"Longer term, prices were lowered to improve competition and the Light of Hope recovery campaign - organised by the Bali Tourism Initiative - saw more good media coverage with tourists getting flowers, gift packs and visitor guides," she explained.

Meanwhile, there was an effort to increase cooperation between Bali Tourism authorities and private industry - hotel chains promoted Bali through favourable offers and the Balinese government opened to direct flights from Heathrow and Kuala Lumpur.

Ms Sinclair also says the industry switched its attention from Western holidaymakers to ones closer to home in Japan and Taiwan.

But, terrorism fears are not the only problem the area has faced in the past 12 months: Bali has also had to cope with Sars (Severe Acute Respiratory Syndrome).

"The effect of the outbreak on the whole Asian region was huge," Ms Sinclair said.

Safer?

The biggest hurdle the country faces, she says, is in making sure it is perceived as a low risk destination.

Bali turned closer to home to keep visitor numbers up

Maybe the Asean summit - with leaders from Asean members such as Malaysia, Myanmar, Philippines and Thailand as well as China, India, Japan and South Korea meeting in Bali last week - will finally overcome security fears surrounding the region.

Ketut Sukriani, a hawker, selling souvenirs outside the complex hosting the Asean summit, and who has seen her income dive 70% in the past 12 months, certainly thinks so.

She told reporters: "If it's safe enough for them, it's surely safe enough for tourists.

"Hopefully they can tell their people that Bali is safer than last year."