Amid a promising rise in international tourist visits, Indonesia’s tourism sector is unexpectedly showing signs of distress. In August 2025 alone, the country welcomed more than 1.032 million foreign tourists. Yet behind this impressive figure, tourism stakeholders are voicing growing concerns over declining revenues and policy obstacles that are tightening the sector’s potential.
Hariyadi Sukamdani, Chairman of the Indonesian Tourism Industry Association (GIPI), recently addressed this contradiction. “We’re highlighting a drop in purchasing power. But here’s the confusing part—according to BPS data, it actually increased. We don’t know why it shows an increase,” he said during a press conference for the National Leadership Meeting (Rapimnas) and National Working Meeting (Rakernas) held at Grand Sahid Jaya Hotel in Central Jakarta, Thursday, July 30, 2025.
GIPI, as one of the key associations representing tourism businesses in Indonesia, sees a clear disconnect between government statistics and what is happening on the ground. “Feedback from various tourism subsectors confirms that revenues are down,” Hariyadi continued.
The subsectors experiencing this decline include hotels, amusement parks, spas, and airline ticket sales. “In the hotel industry, we estimate revenue has dropped by about 30–40 percent in the first semester. For amusement parks, Ancol Dreamland has already reported a 12 percent drop in visitor numbers,” he noted.
The dip in tourist spending is just one part of the problem. Another major factor is the reduction in budget allocations across ministries and government agencies, which also impacts the tourism ecosystem.
Adding further strain, Hariyadi pointed out the rise of illegal tourism businesses. These unlicensed operators, such as unauthorized villas in Bali, are contributing to market oversupply and undercutting legitimate players. Despite recent efforts by Bali Governor I Wayan Koster to dismantle these operations, the pushback from local communities has been strong. Residents in Pecatu Village, particularly those near Bingin Beach in South Kuta, have responded by putting up protest banners.
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Regulatory challenges are also compounding the industry’s woes. According to Hariyadi, several government policies are disconnected from the realities faced by tourism players. He mentioned restrictions on school study tours in West Java, complicated licensing procedures for new tourist attractions, and new baggage limitations introduced by airlines. “I haven’t confirmed the baggage restrictions directly with the Ministry of Transportation, but the regulation in question definitely concerns baggage limitations,” he clarified.
To respond to these setbacks, GIPI is pushing forward with initiatives to reinvigorate the sector. One of the most anticipated is the Wonderful Indonesia Tourism Fair (WITF) 2025, scheduled for October 9–12 at the Nusantara International Convention & Exhibition in PIK 2, North Jakarta. The event is designed to spark new interest and transactions across the tourism value chain.
The fair will feature participation from tourism departments, culinary businesses, MSMEs, and hospitality schools. It will offer both Business to Business (B2B) and Business to Consumer (B2C) segments. GIPI aims to attract between 200 to 250 international buyers and hundreds of domestic sellers from the tourism industry.
While Indonesia’s tourism statistics remain encouraging on paper, the industry’s actual landscape tells a more complex story. The months ahead will test the resilience and adaptability of all players involved, as they navigate tightening regulations, spending cuts, and shifting traveler behavior.
