The provincial and regional administrations have been urged to stop issuing operation permits and licenses for the establishment of new travel agencies in Bali. I Ketut Ardana, chairman of the Bali chapter of the Association of Indonesian Tour and Travel Agencies (ASITA), said that the number of travel agencies operating in Bali had exceeded the island’s requirements. “The government must issue a stronger regulation on the moratorium of new travel agencies for the next few years,” Ardana told Bali Daily in Nusa Dua on Monday afternoon.
The governor, he said, had actually issued a letter to the provincial Investment Coordinating Board (BKPMD) to temporarily halt the issuance of permits for travel agencies pending the result of a feasibility study on travel agencies. ASITA and Udayana University jointly conducted a feasibility study on the travel agency business in Bali, which ended in December 2011. The study found that the number of travel agencies operating was beyond the current level of demand and suggested that the establishment of new travel agencies be halted.
“We have delivered the results to the provincial administration and have frequently asked the governor to translate the study into a policy or a regulation,” Ardana commented. The study discovered that the majority of travel agencies, from a random sample of 100 firms, had an unhealthy business status in terms of tourist handling numbers and low business revenues. Ardana said that this grim picture was partly caused by the vast number of unregistered travel agencies and the unhealthy business competition between local and foreign-affiliated travel agencies.
Based on academic analysis, travel agencies in Bali could actually handle no less than 3.18 million tourists per year. But, in reality, the number was below the academic calculations, he said. Ardana was also concerned over the minimum capital, with 58 percent of travel agencies with investments under Rp 500 million (US$51,867). “Those travel agencies fall into the category of small and medium enterprises [SMEs], which can hardly compete with financially secure companies. With such limited funding, these travel agencies will face difficulties in handling large groups of tourists,” he added.
ASITA will work hard to urge the provincial and regional administrations to impose a moratorium on the operation and establishment of new travel agencies. “The regulation should be made formal. The governments can also ask all registered travel agencies to join ASITA to enable us to control and monitor their operations,” he said. Ardana has received full support from people in the travel industry. Bagus Sudibya, former chairman of ASITA, showed his enthusiastic support by saying that travel agencies must be supportive of each other to face strong competition in the regional and global markets.
source : bali daily
source : bali daily
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