Marine segment offers great potential as Indonesia targets better accessibility

With more than 17,000 islands spanning 54,716 km of coastline and some of the world’s most enchanting diving spots, Indonesia has major potential in the marine tourism segment. And while it is the world’s largest archipelagic country, the marine tourism sector has remained relatively undeveloped.

Out of the Wilderness

Although there are a number of boutique sailing cruises operating out of Bali towards the east and surfers who travel thousands of kilometres to catch a wave at some of the remote islands in the west, the large cruise ships that dock in neighbouring countries such as Malaysia and Thailand rarely make a stopover in Indonesia. Even yachting remains the domain of the more adventurous sailor. In 2014, only 1m of the more than 9m foreign tourists who visited Indonesia were involved in marine tourism.

As such, government efforts to attract more foreign tourists also aim to lure those with a passion for the sea. Arief Yahya, the minister for tourism, has laid down a target of 4m marine tourists by 2019, with a foreign exchange target of $4bn. Quadrupling the number of visitors may seem ambitious, but improving transportation networks across the archipelago and boosting development in Indonesia’s more remote regions are key pillars supporting the administration of President Joko Widodo. Both should provide a solid foundation for the growth of marine tourism. Nevertheless, the government has also unveiled policies to improve the experience of those who choose to take their holiday at sea.

Infrastructure Development

The same limited infrastructure that hampers economic growth across the country has also held up the development of marine tourism. The government’s determination to tackle infrastructure bottlenecks over the next five years should also assist the sea-focussed tourism industry. At present, according to the Ministry of Tourism (MoT), there are 38 marinas and harbours across the archipelago, and marine experts say that for a country of Indonesia’s size that is not enough. Marine infrastructure improvements will focus not only on the creation of 24 seaports, which will largely be trade oriented, but also on the development of areas within designated national strategic tourism areas (NSTA). Indonesia has already created six marine-related NSTAs, including Tanjung Lesung in West Java, Bunaken in north Sulawesi, Raja Ampat in West Papua, Wakatobi in south-east Sulawesi, Komodo Island in East Nusa Tenggara and the Thousand Islands near Jakarta, which have become the focus of many watersports developments. More marine locations, including Moyo Island in West Nusa Tenggara and Banda Neira in Maluku, are expected to be named NSTAs in the next five years. Despite the importance of sea transport, Indonesia’s existing harbours and ports are largely unsuitable for the larger cruise ships that ply South-east Asia. Even for smaller yachts, navigating Indonesia’s waters can be difficult, with changeable currents and shallow waters.

Cruise Ships

“Cruising is on a growth trajectory in Asia, and Indonesia has the potential to become a popular and highly sought-after cruise destination, but for this to happen there are challenges that first need to be addressed,” Ann Sherry, South-east Asian chair of the Cruise Lines International Association (CLIA), a global industry organisation, told OBG. “The need for significant investment in port infrastructure is chief among these, along with the deepening of navigation channels, the updating of hydrographic surveys and ensuring that port costs for cruise operators remain competitive with the region,” she added. CLIA has three members currently operating in Indonesia: Azamara Club Cruises, Crystal Cruises and Silversea Cruises.

Meanwhile, P&O Cruises also services Indonesia within its South-east Asian cruise portfolio, including as part of a 16-night trip from Singapore to Brisbane or a 12-day round-trip from Fremantle in Western Australia. In its March 2015 report on cruise trends in Asia, the UK-US owned group noted that Asians were cruising more than ever, with 1.4m people from the region taking cruise holidays in 2014 alone, a compound annual growth rate of 34% since 2012. Many of those taking cruises are from mainland China, a key market for Indonesia’s tourism industry.

Port Improvements

Benoa Harbour in southern Bali is among the most developed of the country’s ports and provides an indication of what can be achieved with some political will. While the port can handle midsized cruise ships catering to as many as 2000 passengers, vessels that are longer than 300 metres have to drop anchor in the bay and use tenders to get their passengers ashore. The port, which is controlled by state ports authority Pelindo III, is upgrading its facilities to cope with larger ships and provide a more pleasant welcome to visitors arriving by sea. The passenger terminal and Customs facilities have been improved already – Benoa now meets all International Maritime Organisation regulations – and plans are under way to dredge and extend the jetties, providing access to larger ships and making it easier for passengers to disembark. Some 49 ships docked in Benoa in 2014, with the port anticipated to handle 60 cruise ships in 2015. Around 40% of all cruise ships that visit Indonesia dock in Benoa. Dredging works are also under way at 19 other ports across the country, including Tanjung Emas in central Java and Palembang in southern Sumatra.

The MoT estimates that about 203,000 people took a cruise around Indonesia in 2014, with the ministry aiming to more than double this figure to 500,000 cruise passengers by 2016. The number of ports-ofcall made by cruise ships in the archipelago in 2014 has been put at 385, up from 309 in 2013.

Sailors & Surfers

For the yachting community, Indonesia offers an opportunity for some fine sailing, but the same lack of infrastructure that hampers the cruise industry, coupled with considerable bureaucracy, has made the archipelagic waters tricky to navigate for ordinary sailors. Securing sailing permits and Customs and quarantine clearance, as well as limited marina and berthing facilities, discourages many yachts from visiting Indonesia, despite relatively low berthing and mooring rates, according to Aji Sularso, former director-general of fisheries surveillance and local maritime expert and consultant.

Sularso organises Sail Indonesia, an ocean yacht rally now in its 15th year that leaves from the northern Australian city of Darwin each July to take advantage of the east to west winds. Part of the event’s attraction is that it makes things easier for sailors, as the organisers handle all administrative requirements. Some 1000 boats have taken part in the race since 2000, with 50 boats expected to join the flotilla in 2015. “Stops during Sail Indonesia are organised in partnership with the local government so participants can enjoy a cultural show, tour and party, all free of charge,” Sularso explained. “This is a mutual benefit; as hosts, local governments can arrange their annual tourism festival with participants as guests,” he said. “Local governments benefit from a higher number of foreign visitors and their locations become well known to the world through the sailors’ networks. Participants, meanwhile, enjoy the diversity of foods, culture and scenery.”

The rally follows one of the 18 sailing lanes for yachts that now run from Papua in the east to Sabang on Sumatra’s west coast, and its success has encouraged others to set up their own sailing events, some of which are linked to other rallies in the region. In 2015 the Singapore Straits Regatta took place partly in Indonesian waters in January, while the Neptune Regatta – a race across the equator – was concluded in February. Sail Maluku will take place later in August, and the DarwinAmbon Yacht Race is scheduled for September. Sail Indonesia itself, a partnership with the Fremantle Sailing Club in Western Australia, gives crews the option to continue to Singapore and Malaysia once they have completed the 1440 nautical mile trip to Bali. Meanwhile, Sail Malaysia’s “Passage to the East” includes stops in the Anambas and Natuna islands in Indonesia.

A Way To Go

Although sailing guides for Indonesian waters are full of the navigational and logistical challenges involved in sailing the archipelago, the government’s latest initiatives – providing they are properly implemented – should go some way towards encouraging more cruise ships and sailors to take to Indonesian waters, thus enabling the country to meet its targets and more people to enjoy the unique charms of this nation of the sea.

“It would of course be nice to have marinas and boat supply chandleries and workshops across the archipelago,” said Andrew Scott, a sailor and author of the Cruising Guide to Indonesia. “Sailors need these types of businesses as places of rest and repair. Indonesia is a maritime nation and there are generations of skilled craftsmen and boat builders in all the old ports just waiting to fill these positions. It is not as easy as just building marinas expecting sailors will come. It is more of a ‘welcome them and they will come.’ When this begins and more and more yachts arrive each year, growth will come organically.” As Scott points out, those who sail Indonesia tend to have the time of their lives. “I have sailed both foreign-flagged vessels and Indonesianflagged vessels through Indonesia. The only real risk is that you might fall in love with the place and never leave.”

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The Report: Indonesia 2015

Tourism chapter from The Report: Indonesia 2015

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