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Indonesia tourism industry hurt by European Union ban

As the country reels under economic, political and environmental troubles, Indonesia has a new burden to shoulder: an airlines' ban that has a direct impact on its tourism.

The European Union officially banned all 51 Indonesian airlines from flying to Europe starting on July 6, while the U.S. Federal Aviation Administration in April declared Indonesia had failed to comply with international safety standards.

Indonesia has dozens of low-cost airlines following the deregulation of the industry in the late 1990s, leading to a quadrupling of passenger numbers over the past seven years. But its air-safety record has been under fire following two commercial airline crashes that killed 123 people this year alone.

EU's Transport Commissioner Jacques Barrot said the blacklist is considered an important tool in preventing unsafe airlines from flying to Europe and in informing passengers worldwide of safety problems.

"Honestly, the blacklist itself is not surprising since we have had many airline accidents recently," Indonesian Transport Ministry director general for aviation Budi Mulyawan Suyitno said. "Although there is no direct impact — because no Indonesian airlines have been flying to Europe since 2004 — we will improve our safety measures for Indonesian airlines," he said.

Even so, the Indonesian government had earlier ignored two letters of inquiry the EU sent to the transport ministry, before it decided to blacklist the country's airlines.

Indonesian President Susilo Bambang Yudhoyono immediately expressed disappointment at the ban, calling it "the European Union's unilateral action," and demanding more room for dialogue.

Transport Minister Jusman Djamal mulled a tit-for-tat action by hinting at the option of restricting access to its airspace for EU planes, or of advising its citizens not to fly with European airlines.

But the latter invitation is likely to fall on deaf ears, as many polls conducted by local media show that most Indonesians are in fact worried about flying with their national airlines due to their poor safety records.

"I demand the government improve the quality and safety of our transportation immediately," Laksmindra Setyawati, 30, an employee with an international NGO in Jakarta said. Although government officials downplayed the impact, the EU's ban has already begun hurting tourism.

"European Union's airline ban has definitely put a burden on Indonesian tourism, especially now that it's the summer high-season for tourist arrivals," Bali Tourism Board chairman Ngurah Wijaya said. "I know many tourists have canceled their visits.

"It will not only effect tourist arrivals, but will also hurt Indonesia's economy, because it will decrease hotel occupancy rates, souvenir sales, and other things related to tourism," Wijaya said.

Indonesia has set a target of 6 million foreign visitors for this year and 8 million in 2009 nationwide.

The country had missed its tourist-arrival target of 5.5 million in 2006, registering 4.8 million foreign visitors for the year.

To help sweeten the package for foreigners, the government has allowed the citizens of 63 countries to be granted visas on arrival in the archipelago nation.

But the European Union contributes about 25 percent of tourist to the resort island of Bali alone, with as many as 600,000 European tourists visiting the country each year.

"European tourists are in fact important to Indonesian tourism," Wijaya said.

He explained that since Bali has an international airport facility, tourists who already planned their holiday before the ban took effect may yet fly to Bali with other airlines via Singapore.

"But it will definitely hurt other parts of Indonesia's tourism spots like Yogyakarta, Borneo and Sulawesi island, since tourists then have to take domestic flights," Wijaya said.

Indonesia's efforts to improve air safety following a string of accidents and near-misses has so far resulted in revoking licenses of four airlines and suspending five others for failing to comply with basic standards in late June.

Earlier this month, Indonesia signed a joint declaration with International Civil Aviation Organization pledging to improve safety, restructure and strengthen the supervisory capacity of the air transport directorate-general, and meet international standards.

"Our country's tourism image has been damaged by strings of terrorist attacks, natural disasters and diseases such as bird flu, we can't afford to lose more tourists by this airlines ban," Wijaya said.

"We can't just provide excuses anymore, it is a fact that our image is terrible, we need to do something about it before other countries follow EU's ban," he said.

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