Deputy head of the representative office of Bank Indonesia for the province of Bali, Gusti Agung Diah Utari said “Bali has many short-term and long-term challenges for economic recovery in 2023.”
Diah Utari made the announcement at Bank Indonesia’s annual general meeting on Wednesday, November 30. The meeting was attended by stakeholders including TNI-Polri, the private sector, universities, and many of the KPwBI strategic partners in Bali.
The Obstacles
“As short-term challenges, we see risks to the global economy in 2023 and geopolitical conflict between Russia and Ukraine,” says Diah Utari.
Diah Utari also mentioned that the short-term challenge is also from the ongoing scarring effect in the tourism sector, including inflationary pressures in 2023 and the threat of global protectionism, and the zero COVID policy in China.
Regarding medium to long-term challenges, BI recognizes challenges related to changes in foreign and domestic tourist trends post-pandemic.
Funds to accelerate economic growth are limited, and there’s a demand for tourism to transition to green tourism.
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The Recommendations
Bank Indonesia for the province of Bali added the Recommendations to address these challenges in the short term by strengthening and developing potential tourism such as sea tourism, health tourism, and more. Then, digitalizing and engaging Micro, Small, and Medium Enterprises (UMKM) are also needed.
There are also short-term efforts to fund innovation, boost investment, and curb inflation.
For the medium and long-term recommendations, through economic validation, the digitalization of upstream and downstream agriculture and the development of creative industries in crafts, fashion, and cuisine.
In addition, there is a development of quality tourism through the presence of tourist villages, nature tourism, health tourism, and maritime tourism centers.
Despite many challenges, BI forecasts Bali’s economic growth to be between 4.40% and 5.20% in 2023. Bali’s economy grew at 8.09% (year-on-year) in Q3 2021, up significantly from its 3.03% (year-on-year) in the previous quarter.
Throughout 2022, BI has made many efforts to help the economic recovery of the Isle of God and curb inflation by conducting Bali Jagadita Culture Week, Business Matching, MSME Products, and Investment Forecast.
Bali’s economic growth in the third quarter of 2022 is also improved due to performance in tourism-related businesses: transport, accommodation and food and beverage provision, wholesale, and retail.
Besides that, the holding of various G20 side events and other strategic events in Bali was able to encourage an increase in the number of Balinese tourists in the third quarter of 2022, namely the occupancy rate of star hotels increased significantly from 31.70% in the third quarter to 40.78% in the third quarter of 2022.
On the other hand, it is related to controlling inflation by supporting market manipulation, providing Chilean seed aid, facilitating inter-regional cooperation, and supporting downstream food.
Additionally, there are training courses on digitization with payment systems to facilitate the use of QRIS. QRIS is the National QR code standard to facilitate QR code payments in Indonesia.
The head of the representative office of bank Indonesia in the province of Bali, Trisno Nugroho in Denpasar said that QRIS users in Bali are becoming more and more massive. The increase already reached 197% by October 2022, reaching 609,343 users, while the merchants’ who use QRIS are only 544,809 merchants.
