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We are pleased to provide this brief executive summary of our report titled “Short-Term Forecasts of Visitor Arrivals to Bali, 2018-2020.” The full report can be downloaded at the end of the post. Subscribers to the report will receive a complimentary update of our forecasts of inbound tourist arrivals from China, Australia, India, USA, UK, Japan, Germany, France, Malaysia and Singapore every six months. 

Executive Summary

Bali continues to be seen as the jewel in the crown of Indonesia’s burgeoning tourism industry. With the exponential growth in tourism, it is important that the demand for the island’s tourism product grows in alignment with the facilities available in a sustainable way.

Clear strategies are required to cater not just to the economic aspects of tourism, but to the environmental and social effects as well. Well-targeted advice is also needed to inform future planning and investment decisions.

Our forecasts support these goals by providing hotel investors, developers, managers, marketers, policymakers, and planners with short-term forecasts for:

  •  Inbound international arrivals, focusing on Bali’s main source markets, such as China, Australia, and India.
  •  Inbound domestic arrivals which originate from mainly East and Central Java as well as Jakarta
  • The average length of stay in star-rated hotels, and
  • Occupancy rates, a critical metric for the performance of hotels and other types of accommodation

Results from our forecasts show:

• Over the next three years, total visitor numbers to Bali are expected to increase by 26.3%, from 14.4 million in 2017 to 18.2 million in 2020
• Between 2017 and 2020 inbound visitor arrivals from ASEAN countries are expected to grow by 47% from 428,000 in 2017 to 629,000 in 2020
• Over the next three years, total visitor numbers from Asia-Pacific countries are expected to increase by 20.7% from 3.5 million in 2017 to 4.3 million in 2020
• China will remain Bali’s largest international source market, followed by Australia and India.

Our Forecasts

Our forecasts represent the most likely outcomes given past trends and current information. As with all forecasts, any variations in the assumptions or any disruptive events could produce risks that may drive forecasts either upward or downward. For this reason, we have introduced confidence limits with our forecasts.

International Visitor Arrivals to Bali, Indonesia 1982-2020

The significant growth in international tourist arrivals will continue due to Bali’s proximity to major Asia Pacific markets, visa-free travel from many major source markets, growing air transport connectivity and the governments aggressive marketing campaigns highlighting the island’s range of attractions. The island has made the most of its globally recognized natural and cultural resources at very affordable prices. In summary:

  • 1.7 million visitors in 2007, 5.7 million in 2017, exceeds the official target of 5.21 million, annual growth of 13.1%
  • 7.5 million international visitors in 2022, 32.4% on 2017, 25% probability greater than 9.4 million, annual growth of 9.8%
  • market share 40.2% of total visitors in 2007, 39.5% in 2017 & 41.4% in 2022

Growth in Domestic Visitors to Bali, Indonesia 2004-2020

Indonesia’s population of about 260 million people presents a huge potential domestic tourism market. The potential is constrained however by the low average household income levels. As the economy grows, private consumption is expected to grow at about 5-6% per year resulting in the growth of domestic tourism generated by a better-off middle class. As illustrated in our report, East Java, Central Java and Jakarta accounted for 36.6%, 14.3%, and 12.9% of domestic visitor arrivals respectively, to Bali in 2017 according to the Bali Government Tourism Office. In summary:

  • 2.5 million visitors in 2007, 8.7 million in 2017, annual growth of 13.4%
  • 10.7 million domestic visitors in 2022, 22.4% on 2017, 25% probability greater than 12 million, annual growth of 7%
  • market share 59.8% of total visitors in 2007, 60.5% in 2017 & 58.6% in 2022

Growth in Inbound International Visitor Arrivals from China, Australia and India 2002-2020

Despite the stranding and evacuation of thousands of Chinese tourists in November and December 2017 due to the activity from the Volcano Mt. Agung, Chinese tourists surpassed Australian tourists to become Bali’s biggest source market in 2017. Lion Air is currently opening 20 new routes between China and Indonesia as part of the group’s strategy to deliver 2.5 million foreign tourists to Indonesia. Expect to see the development of hotels and services catering to the Chinese market. In summary:

  • 84,000 visitors in 2007, 1.4 million in 2017, annual growth of 32.3%
  • 2 million visitors in 2022, 46.5% on 2017, 25% probability greater than 3.6 million, annual growth of 13.6%
  • Rank # 6 in 2007, # 1 in 2017 and # 1 in 2022

Modest growth as the Australian economy is expected to rebound from lower-than-expected growth of 1.8% in 2016–17 to approach its trend rate of growth over the next two years. Real GDP growth of 2.75% in 2017–18, increasing to 3.0% in 2018–19. The travel culture of Australians continues to display a shift towards experiential adventure and discovery across all age groups which augurs well for continued, albeit modest growth from Australia. In summary:

  • 204,000 visitors in 2007, 1.1 million in 2017, annual growth of 18.3%
  • 1.2 million visitors in 2022, 5.9% on 2017, 25% probability greater than 1.3 million, annual growth of 1.9%
  • Rank # 2 in 2007, # 2 in 2017 and # 2 in 2022

India’s economy is projected to increase by 7.4% in 2017–18 and 7.5% in 2018–19. The higher economic growth will flow on to wider society, increasing the size of middle-income groups, and adding to travel propensities. Bali recorded a 49.7% growth in inbound tourists from India after the launch of Garuda Indonesia’s flights between Mumbai and Jakarta in early 2017. Batic Air now connects Bali to Chennai. Expect to see increased investments from India in the tourism sector. In summary:

  • 22,000 visitors in 2007, 273,000 million in 2017, annual growth of 35.8%
  • 649,000 visitors in 2022, 138% on 2017, 25% probability greater than 737,000, annual growth of 33.3%
  • Rank # 14 in 2007, # 3 in 2017 and # 3 in 2022

Average Monthly Occupancy for Star-Rated Hotels in Bali, Indonesia 1990-2020

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