Indonesia raises bet on lucrative cruise industry
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The shimmering sound of Balinese music played by a local gamelan group welcomed the Pacific Eden cruise ship as it approached Benoa Port in Bali on Thursday Guided by a tugboat, the 219-meter-long vessel, operated by P&O Cruises Australia, needed 30 minutes to smoothly dock at the port that sunny afternoon.
Carrying over 1,000 tourists, mostly Australians, Pacific Eden has made a breakthrough in Indonesia’s tourist industry as it became the first cruise ship ever docked at a local port.
“This makes a huge difference in the experience of our guests,” P&O Cruises Australia president Sture Myrmell said to government officials invited onboard to celebrate the historical milestone.
Despite its potential in coastal and maritime tourism, Indonesia has been struggling to tap into opportunities of cruise ships coming to the archipelago.
Previously, incoming cruise ships preferred to moor off shore mainly due to technicalities, such as lack of supporting infrastructure and the absence of a reliable under-water topographic maps, known as bathymetric charts. Passengers who want to go ashore were then transported on small boats.
In the case of Pacific Eden, the docking was made possible after the government completed the bathymetric chart for Benoa water and after state-owned port operator PT Pelabuhan Indonesia (Pelindo) III, which manages Benoa Port, upgraded the facility to a cruise terminal.
“We sent supporting data about Benoa waters to P&O executives so their ship captains could devise strategies on how to enter the port safely. Their presence here proves that we have finally convinced them about safety,” Pelindo III general manager for Benoa Port Ardhy Wahyu Basuki said.
Last year, Indonesia welcomed 11.5 million foreign tourists, with those from China topping the list at 1.43 million arrivals.
President Joko “Jokowi” Widodo has set his sights on developing the tourism sector. His administration hopes for 20 million foreign tourist arrivals in 2019, with this year’s target standing at 15 million.
“Last year, Indonesia welcomed 11.5 million foreign tourists, with those from China topping the list at 1.43 million arrivals.”
The number of tourists entering the country by cruise ships has shown progress, but still only makes up a tiny fraction of the total incoming foreign tourists.
Last year, visiting cruise ships made 350 stops in Indonesia, down from 400 stops in 2015, said Tourism Minister Arief Yahya. The number of passengers onboard, however, increased by 30 percent to 260,000 from 200,000.
“This shows that there is a changing trend in which passengers prefer to travel on mediumsized cruises instead of small ones,” Arief told reporters, underlining the importance of port infrastructure upgrades to accommodate such a trend.
Apart from huge, lavish vessels, the cruise business is known to attract high spenders. A family of four, for example, should pay A$7,200 (US$5,400) to stay in a Pacific Eden suite room and enjoy a 12-night journey to popular tourist destinations, such as Bali, Lombok and Komodo National Park.
According to data from Cruise Lines International Association (CLIA), there were 23.2 million people traveling on cruise ships in 2015, with the United States accounting for the most passengers at 11.3 million, followed by Germany, Australia and China. The figure is predicted to increase to 25.3 million this year.
Arief did not mention the government’s short-term target for incoming cruise passengers. He, however, pointed to Thursday’s inaugural docking as momentum for the government to propel the industry, including by upgrading port infrastructure on Bali, which the government expected to become a regional cruise hub, as well as by reviewing cost structures that might hamper the industry’s growth.
Indonesian ports currently charge a cruise ship between $60,000 and $100,000 daily for docking fees, much higher than regional competitors that can charge as low as $20,000 per day, Arief said.
“This has dragged down our competitiveness in the sector,” he said. “Thus, deregulations and infrastructure upgrades should go hand-in-hand to boost the sector.”
Questions & Answers
Q.What prevented cruise ships from docking directly at Indonesian ports previously?
What prevented cruise ships from docking directly at Indonesian ports previously?
Cruise ships previously preferred to moor offshore due to technical issues. These included a lack of supporting infrastructure and the absence of reliable underwater topographic maps, known as bathymetric charts.
Q.How did Benoa Port overcome the challenges to allow the Pacific Eden to dock?
How did Benoa Port overcome the challenges to allow the Pacific Eden to dock?
The government completed the bathymetric chart for Benoa water. Also, the state-owned port operator PT Pelabuhan Indonesia (Pelindo) III upgraded the facility to a cruise terminal.
Q.What is the government's target for foreign tourist arrivals in the coming years?
What is the government's target for foreign tourist arrivals in the coming years?
President Joko Widodo's administration hopes for 20 million foreign tourist arrivals in 2019. The target for the current year stands at 15 million foreign tourist arrivals.
Q.What factor makes Indonesian ports less competitive for cruise ships compared to regional rivals?
What factor makes Indonesian ports less competitive for cruise ships compared to regional rivals?
Indonesian ports charge cruise ships between $60,000 and $100,000 daily for docking fees. This is significantly higher than regional competitors, which can charge as low as $20,000 per day.
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