Malaysia is emerging as an increasingly important source of foreign tourists for Indonesia as rising flight costs put pressure on long-haul travel. The country’s close proximity to Indonesia has helped keep regional tourist arrivals strong, while a weaker rupiah is also making Indonesia a more competitive holiday destination for international visitors.
The trend comes as the global tourism industry faces pressure from higher jet fuel prices and more expensive airfares, particularly for travelers taking long-distance flights. For Indonesia, however, the situation is creating an opportunity to rely more on nearby markets, especially those within Southeast Asia.
According to Hariyadi Sukamdani, Chairman of the Indonesian Tourism Industry Association (GIPI), regional tourism is currently showing a notable trend despite the challenges facing long-haul travel.
“Yes, the challenges are quite significant, especially for long-haul travel, where ticket prices are certainly a factor. But in the regional market, we are actually seeing an interesting phenomenon,” Hariyadi said after the Wonderful Indonesia Tourism Fair (WITF) 2026 press conference at the Ministry of Tourism Office.
Malaysia has become one of the clearest examples of that trend. Hariyadi said a large number of Malaysian travelers are currently visiting Indonesia.
“Malaysia in particular. We are now seeing a lot of people from Malaysia coming to Indonesia,” he added.
The strong flow of Malaysian tourists presents an opportunity at a time when long-haul tourism is dealing with higher travel costs. Indonesia’s geographic proximity to Malaysia makes the regional market an important source of visitors, particularly as uncertainty continues to affect international travel.
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The weaker Indonesian rupiah is another factor that could support demand. For foreign visitors, a weaker rupiah can make accommodation, food, activities, and other holiday expenses in Indonesia relatively more affordable compared with destinations where their currencies have less purchasing power.
Hariyadi said the tourism sector is looking to take advantage of the current exchange-rate situation.
“Because our rupiah is weakening, this is something we are currently trying to encourage. With the rupiah weakening, this is actually a good time for tourists to take a holiday in Indonesia because it makes prices more competitive,” Hariyadi continued.
Even with the opportunities offered by regional markets, the global tourism sector is still dealing with several obstacles. Airfare remains one of them, while oil prices can also affect aviation costs and international flight activity.
Higher operating costs can eventually be reflected in ticket prices, making long-distance travel more expensive and potentially affecting tourist flows between countries.
Despite these challenges, Hariyadi said Indonesia still has room to increase the number of foreign visitors. He pointed to the country’s tourism performance in the previous year as an indication of that potential.
“But we still see opportunities. As I mentioned earlier, if we look at the number of foreign tourists alone, last year we were already approaching 16 million. This year, we will most likely exceed 16 million,” he said.
Recent data from Statistics Indonesia (BPS) also highlights the growing importance of regional markets. According to the latest figures on the origins of foreign tourists entering Indonesia, Malaysian visitors ranked first during the first half of 2026.
The numbers remained significant in July. Indonesia recorded 1.53 million foreign tourist arrivals that month, with Malaysian visitors contributing 228,710 visits. That was around 15% of the total arrivals.
Australia followed with 188,250 visits, while Chinese tourists recorded 156,750 visits.
The figures show how important nearby markets have become for Indonesia’s tourism sector. Malaysia currently leads the list, while Australia and China also contribute substantial numbers of foreign visitors.
For Indonesia, the current situation means that the tourism industry has opportunities to grow even while international travel faces cost and geopolitical pressures. Long-haul tourism may be more expensive, but regional visitors continue to provide a strong source of demand.
With Malaysia already accounting for the largest share of foreign tourist arrivals in Indonesia during the first half of 2026, Southeast Asia is proving to be an important market for country’s tourism industry. The weaker rupiah could add another incentive for international travelers by making holidays in Indonesia more competitively priced.
