Sector

Tourism

Indonesia has designated tourism as a primary sector with a strong commitment to integrated infrastructure development and the enhancement of skilled and quality human resources. In 2023, the realization of investment in the tourism sector was predominantly driven by domestic investment (PMDN), reaching Rp 14.9 trillion. The PMDN funds were allocated to various types of businesses, including Rp 8.228 billion for star-rated hotels in West Nusa Tenggara, Rp2.601 billion for tourism areas in DKI Jakarta, and Rp1.656 billion for restaurants in Bali.

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Tourism

Indonesia has designated tourism as a primary sector with a strong commitment to integrated infrastructure development and the enhancement of skilled and quality human resources. In 2023, the realization of investment in the tourism sector was predominantly driven by domestic investment (PMDN), reaching Rp 14.9 trillion. The PMDN funds were allocated to various types of businesses, including Rp 8.228 billion for star-rated hotels in West Nusa Tenggara, Rp2.601 billion for tourism areas in DKI Jakarta, and Rp1.656 billion for restaurants in Bali.

Indonesia has identified 10 priority tourism destinations, including Borobudur, Mandalika, Labuan Bajo, Bromo Tengger Semeru, Thousand Islands, Lake Toba, Wakatobi, Tanjung Lesung, Morotai, and Tanjung Kelayang. Both domestic and international tourists constitute the country’s tourism market potential. In 2023, the number of foreign tourist visits reached 11.68 million, with the largest contributions coming from Malaysia, Australia, Singapore, China, and East Timor. This increase in visits also corresponds with the growth of tourism foreign exchange earnings, which reached US$6.08 billion in the first semester of 2023.

Major provinces attracting international tourists include Bali, DKI Jakarta, Riau Islands, West Nusa Tenggara, and East Java. Meanwhile, the number of domestic tourist trips in 2023 reached 749,114,709 trips, with DKI Jakarta, DI Yogyakarta, and East Java having the highest travel ratios.

Aside from the tourism sector, Indonesia’s creative economy sector has also shown significant growth, with exports reaching US$11.82 billion in the first half of 2023. The fashion subsector is the main contributor with US$6.56 billion (55.52 percent), followed by culinary products with US$4.46 billion (37.70 percent), and crafts with US$792.67 million (6.71 percent).

Moreover, the sector has realized US$225.28 million in foreign direct investment (FDI) and US$577.87 million in domestic direct investment (DDI) in the first quarter of 2023 out of the sector’s total target investment of US$2.68 billion in 2022. The Tourism and Creative Economy Ministry targets investment in this sector to reach US$6-8 billion, with the hope of creating 4.4 million new jobs in 2024.  This investment fund is planned to be allocated for the development of five-star hotel accommodations in super-priority tourism destination areas (DPSP) and 10 other priority tourism destinations.

Meanwhile, realized investments in the tourism sector in 2022 amounted to US$2.33 billion. Furthermore, FDI also contributes significantly, especially reaching Rp8.7 trillion from Singapore amounting to Rp2.458 billion, followed by Hong Kong with Rp1.720 billion, and India with Rp1.385 billion.

Latest News

April 1, 2026

President Prabowo Subianto has utilized the Lebaran (Idul Fitri) holiday to maintain his ties with key political figures, including Megawati Soekarnoputri, chairwoman of the Indonesian Democratic Party of Struggle (PDI-P). As the only major party that has not formally declared support for his administration, Megawati’s potential backing represents the “One Piece”: the final element needed for Prabowo to fully consolidate his leadership, an outcome he has long pursued.

In the popular Japanese anime series, the titular "One Piece" is the ultimate treasure sought by the pirate captain Monkey D. Luffy to become king. In Indonesia’s political context, the "One Piece" is the final part of Prabowo’s coalition: securing the PDI-P’s support to ensure total legislative and executive harmony. To date, the majority of parties in the House of Representatives is behind Prabowo, with the PDI-P as the sole exception.

This effort became increasingly evident when Prabowo and Megawati met just days before Lebaran. Notably, Megawati has taken a different approach than other former presidents: while others frequently attend invitations to the State Palace, Megawati often declines, largely due to long-standing personal friction with fellow ex-presidents Susilo Bambang Yudhoyono and Joko “Jokowi” Widodo. As such, meetings between Prabowo and Megawati are typically conducted behind closed doors with limited participants, accommodating a more exclusive and arguably more substantive engagement.

According to Cabinet Secretary Teddy Indra Wijaya, the pair addressed current geopolitical dynamics following Megawati’s visits to the United Arab Emirates and Saudi Arabia. However, that their preholiday meeting lasted two hours suggests discussions likely extended into internal political stability, particularly amid the growing tension involving PDI-P politicians.

Notably, lawmakers My Esti Wijayati, Adian Napitulu, Bonnie Triyana and Deni Cagur have criticized the 2026 State Budget Law, arguing that it improperly allows education funds to be reallocated to the National Nutrition Agency (BGN) for the purpose of implementing Prabowo’s flagship initiative, the free nutritious meal program.

Interestingly, their criticism might indirectly challenge the PDI-P’s senior figure Said Abdullah, who chairs the House Budget Committee and oversaw the legislature’s approval of the draft state budget in mid-2025. Furthermore, the free meals program is seen as consuming a substantial portion of the 2026 budget, increasing pressure on fiscal capacity amid global economic uncertainty and rising oil prices. The reallocation of education funds has also led to dissatisfaction among local leaders, as it has constrained regional transfers from the central government.

In response to claims by the BGN that all parties, including the PDI-P, had benefited financially from potential budget misuse linked to the free meals program, the PDI-P issued a circular instructing its members to avoid such an outcome.

Meanwhile, Prabowo remains firm in emphasizing that the program must continue to support lower-income households.

The legal validity of the program’s funding allocation is being challenged at the Constitutional Court, where contract teacher Reza Sudrajat has argued that education spending had fallen below the minimum 20 percent of the state budget as constitutionally mandated.

The recent meeting between Prabowo and Megawati is widely seen as an attempt to bring the PDI-P into his big-tent coalition. If the PDI-P does join up, formal opposition would effectively vanish and allow for smoother implementation of government programs at both the national and regional levels. To accommodate this, however, Prabowo’s Gerindra Party will likely need to adjust its share of ministerial positions to provide the PDI-P a proportional seat at the table.

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