2019 INTEGRATED TOURISM MASTER PLAN FOR BOROBUDUR ...p3tb.pu.go.id/uploads_file/20191231041524.Growth Projections and... · Figure 6.4: RTRW Kapubaten Magelang .....55. BYP ITMP -

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Prepared on Behalf of

Center of Strategic Region Development Regional Infrastructure

Development Agency (RIDA) Ministry of Public Works & Housing

Growth Projections and Development

Scenarios

in association with

www.tourismdev.com

INTEGRATED TOURISM MASTER

PLAN FOR BOROBUDUR –

YOGYAKARTA - PRAMBANAN

21st

October

2019

BYP ITMP - Growth Projections and Development Scenarios

Contents

Page No

1. Introduction .............................................................................................................. 1 1.1. BYP and the Tourism Area Life Cycle ...................................................................................... 2

1.2. Key Issues affecting tourism in Borobudur-Yogyakarta-Prambanan ...................................... 2

1.3. Methodology for determining visitor forecasts and impacts ................................................. 3

2. Growth Projections .................................................................................................... 9 2.1. Population projections ............................................................................................................ 9

2.2. Visitor arrivals projections .................................................................................................... 11

2.3. The significance of domestic tourists .................................................................................... 15

2.4. Implications for Accommodation Provision .......................................................................... 16

2.5. Economic impact projections ................................................................................................ 17

3. Development Scenarios ........................................................................................... 26 3.1. Vision for Borobudur-Yogyakarta-Prambanan...................................................................... 26

3.2. Growth Options for BYP ........................................................................................................ 28

4. Proposed Planning, Space and Design Standards ...................................................... 43 4.1. Planning spatial layers ........................................................................................................... 43

4.2. Proposed Design Guidelines .................................................................................................. 46

5. Evaluation ............................................................................................................... 48 5.1. Evaluation criteria ................................................................................................................. 48

5.2. Conclusion ............................................................................................................................. 49

6. GIS-Based Decision-Making Tool .............................................................................. 50 6.1. Introduction .......................................................................................................................... 50

6.2. GIS Exclusion Layer................................................................................................................ 50

6.3. GIS Attraction Layer .............................................................................................................. 53

6.4. Stakeholder Engagement, Weighting of Parameters............................................................ 54

6.5. Evaluation, Presentation ....................................................................................................... 54

6.6. Representation of Development Scenarios .......................................................................... 54

6.7. Availability of GIS Data .......................................................................................................... 56

6.8. Conclusion ............................................................................................................................. 57

Appendices

Appendix 1: Supporting information for Section 1.3 (Methodology) ..................................... 58 Appendix 2: Map of ‘Metro Yogyakarta’ ................................................................................. 66 Appendix 3: Indexed figures for economic impacts on GRDP ................................................. 67 Appendix 4: Indicative List of Stakeholder meetings July-October 2019 ................................ 70


List of Tables

Table 1.1: Growth forecasts for international visits .................................................................. 5 Table 1.2: Cost of creating jobs in tourism (direct and indirect) ............................................... 7 Table 1.3: Estimate of spend according to economic sector (Malaysia example) .................... 7 Table 2.1: Population Projections .............................................................................................. 9 Table 2.2: Visitor growth (domestic and international) – ‘Business as Usual’ Scenario ......... 13 Table 2.3: Visitor growth (domestic and international) – ‘Best Case’ Scenario ...................... 13 Table 2.4: Expected Visitor Nights in Destination - ‘Business as Usual’ Scenario ................... 14 Table 2.5: Expected Visitor Nights in Destination - ‘Best Case’ Scenario ................................ 14 Table 2.6: Growth in International Arrivals as Proportion of Total Visitors ............................ 14 Table 2.7: Additional rooms required (Business as Usual) ...................................................... 17 Table 2.8: Additional rooms required (Best Case) ................................................................... 17 Table 2.9: Forecast expected expenditure by all visitors (Business as Usual) ......................... 18 Table 2.10: Forecast expected expenditure by all visitors (Best Case) ................................... 19 Table 2.11: Forecast Tourism Sector Contribution to GRDP of Central Java and DI Yogyakarta (Business as Usual) ................................................................................................................... 20 Table 2.12: Forecast Tourism Sector Contribution to GRDP of Central Java and DI Yogyakarta (Best Case)................................................................................................................................ 21 Table 2.13: Central Java and DI Yogyakarta GRDP (based on current prices) ......................... 22 Table 2.14: Tourism Sector Economic Impacts on other sectors (Central Java and DI Yogyakarta) Business as Usual scenario (USD million) ............................................................ 23 Table 2.15: Tourism Sector Economic Impacts on other sectors (Central Java and DI Yogyakarta) Best Case scenario (USD million) ......................................................................... 23 Table 2.16: Estimated job creation through visitor spend ...................................................... 24 Table 2.17 Tourism Sector’s Impact on Employment - Business as usual scenario (in $ million) ..................................................................................................................................... 24 Table 2.18 Tourism Sector’s Impact on Employment - Best case scenario ............................. 25 Table 3.1: Development Scenario Options .............................................................................. 34 Table 4.1: Proposed Tourism Spatial Layer Planning Standards ............................................. 44 Table 4.2: Proposed Design Guidelines ................................................................................... 46 Table 5.1: Evaluation of Options A, B, and C ........................................................................... 49 Table 6.1: GIS Base Layers........................................................................................................ 57 Table A1.1: Distribution of International arrivals by source market country ......................... 58 Table A1.2: Approximate numbers of visitors from ‘other’ countries .................................... 58 Table A1.3: Accommodation supply data (baseline) ............................................................... 59 Table A1.4: Growth rates for ‘Business as Usual’ scenario...................................................... 61 Table A1.5: Growth rates for Best Case Scenario growth, 2023-45 ........................................ 62 Table A1.6: Inputs to Phase 4 modelling ................................................................................. 63 Table A1.7: Average Daily Spend by Market Category ............................................................ 64 Table A1.8: Percentage Increase in Average Spend (Real Terms per annum) ........................ 65 Table A3.1: Index Figures for tourism’s contribution to the C Java and DIY Economy (Business as Usual) ................................................................................................................................... 67 Table A3.2: Index Figures for tourism’s contribution to the C Java and DIY Economy (Business as Usual) ................................................................................................................................... 68 Table A3.3: Historical Inflation Rates for Central Java ............................................................. 69


List of Figures

Figure 1.1: Process of arriving at Development Options ........................................................... 1 Figure 1.2: Tourism Area Life Cycle (TALC) ................................................................................ 2 Figure 2.1: Overall total population growth for Central Java/DI Yogyakarta .......................... 10 Figure 2.2: International arrivals to Indonesia 1995-2018 ...................................................... 11 Figure 2.3: Growth in International Arrivals as Proportion of Total Visitors ........................... 15 Figure 3.1 : The Sphere of Tourism Resilience ......................................................................... 27 Figure 3.2 : ‘Hub and Spoke’ Option ........................................................................................ 29 Figure 3.3: ‘Cluster and Disperse’ Option ................................................................................ 30 Figure 3.4 : ‘Heart of Java’ Option ........................................................................................... 31 Figure 6.1: Borobudur TDA, Disaster Risk Analysis .................................................................. 51 Figure 6.2: Borobudur TDA, Land Valuation ............................................................................ 52 Figure 6.3, Borobudur TDA, Preliminary Exclusion Assessment .............................................. 53 Figure 6.4: RTRW Kapubaten Magelang .................................................................................. 55


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1. Introduction

Borobudur-Yogyakarta-Prambanan (BYP) is a well-established destination which already attracts

significant numbers of visitors, especially domestic tourists and day visitors. The destination is less

well known internationally, with only around 3% of total arrivals coming from abroad. While domestic

growth rates have been encouraging and relatively stable in recent years, there are indications that

the international market is beginning to stagnate – especially as far as visits to the WHS of Borobudur

and Prambanan are concerned - and therefore needs to be energized through an appropriate

development strategy.

This report is divided into four principal sections: Introduction and Key Issues, Growth Projections,

Development Scenarios, and Evaluation. The process is illustrated in the figure below.

Figure 1.1: Process of arriving at Development Options


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1.1. BYP and the Tourism Area Life Cycle

Considering the present position of the destination in the context of Butler’s 1980 Tourism Area Life

Cycle Model (Figure 1), it seems probable that BYP tourism is towards the end of the consolidation

phase and beginning to enter the stagnation phase, mainly because of over-reliance on a narrow

product offer. In such cases there are generally two broad scenarios: either the destination will

decline, both in quality of the product offer and quantity of visitors, or it can be rejuvenated. In the

case of BYP, particularly in the light of President Joko Widodo’s aspiration of seeing 2 million arrivals

of foreign tourists per year at the destination, this means considerable planning in order to revitalise

BYP and move into a rejuvenation phase.

Figure 1.2: Tourism Area Life Cycle (TALC)

Source: Butler 19801

1.2. Key Issues affecting tourism in Borobudur-Yogyakarta-Prambanan

In order to plan appropriate interventions which will achieve renewal, a thorough understanding of

the area is needed. A Baseline Analysis conducted during 2018-19 identified the principal barriers to

a more successful tourism system for BYP as:

1. Narrow tourism product offer 2. Over-reliance on cultural tourism 3. Overtourism at Borobudur Temple Compounds World Heritage Site (WHS) 4. Weak appreciation of preserving heritage values and heritage economics 5. Over-reliance on domestic market 6. Low international standard of attractions and interpretation 7. Poor access in terms of the volume of existing / forecast arrivals 8. Inadequate services infrastructure 9. Deteriorating environmental conditions, including air pollution and depletion of

groundwater 10. Weak ability of local communities to take advantage of economic opportunities, partly

through skills and training gaps 11. Weak institutional frameworks and enforcement 12. Inadequate coordination and planning

1 Butler, R. (1980) The concept of a tourist Area Cycle of Evolution: Implication for Management of Resources. Canadian Geographer, 24(1), pp.5-20

BY

P


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Strong initiatives will be required to secure growth and avoid long-term decline, and the options for development scenarios presented in this report and in the separate Visitor Management Plan for Borobudur are designed to address these. Before moving on to discuss the development scenarios, likely growth scenarios for domestic population, international and domestic visitor numbers, increased demand for accommodation, and economic growth projections for tourism earnings and contribution to the economy will be presented in the next section. The methodology for calculating the arrivals growth scenarios, which drive increased demand for accommodation and the economic impact of tourism, is shown in Section 1.3, with additional material in Appendix 1.

1.3. Methodology for determining visitor forecasts and impacts

Providing the forecasts of visitor numbers and the demand for additional hotel rooms and other

facilities involved developing a five-phase model. Several data sources were used for this but, as

explained in earlier reports, the baseline of data that we have been able to access is poor, with limited

trend data and gaps. In a number of places, we have had to make assumptions based on our own

experience and from comparable examples outside the study area.

The five-phase model was developed as follows:

Phase 1: Identifying the baseline data for visitor arrivals

Phase 2: Identifying the baseline of accommodation supply and performance

Phase 3: Modelling two scenarios of visitor growth to 2045

Phase 4: Modelling how visitor growth might translate into hotel rooms

Phase 5: Modelling the potential economic impacts of visitor growth

1.3.1. Phase 1: Identifying Arrivals Baseline

Visitors to Borobudur-Yogyakarta-Prambanan were divided into four groups.

1. Domestic leisure visitors – staying in commercial accommodation.

2. Domestic business (MICE) visitors - staying in commercial accommodation.

3. International visitors – staying in commercial accommodation. These were further split by

main country of origin.

4. Domestic day and VFR visitors2.

Figures for the first three categories of staying visitors were drawn from the Baseline report (Chapter

4) and are based on DI Yogyakarta data. There was a variety of reasons for using this data:

• it was the most recent available

• the majority of available accommodation (93%) is in DI Yogyakarta

• the model assumed that a trip to the area would generally include a visit to Yogyakarta, so

that using data for Borobudur and Prambanan from a different source could lead to double

counting of visitors.

2 Drawn from Horwath HTL (2016) Borobudur-Yogyakarta-Prambanan: Baseline Supply & Demand, Market Demand Forecasts, and Investment Needs


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The split between leisure and business visitors (80:20) is based on data in Horwath HTL (2016), while

the split of international visitors (398,000) by country is based on DI Yogyakarta Tourism Office

Statistics 2017. The distribution split into individual countries is shown in Appendix 1.

1.3.2. Phase 2: Identifying Accommodation Baseline

Phase 2 involved identifying the current accommodation supply and performance across the area.

This included identifying:

• The supply of rooms for four areas – (1) Borobudur, (2) Prambanan, (3) City of Yogyakarta and

(4) DI Yogyakarta, excluding the City of Yogya. Accommodation was split into star and non-

star hotel accommodation, and homestay accommodation.3

• Average Length of Stay (ALOS). For hotels, data was available for international and domestic

ALOS. For Yogyakarta available data on this was also split by star and non-star

accommodation. Estimates of ALOS were available for homestays in Borobudur, and it was

assumed (in the absence of other data) that homestays in other areas would perform in a

similar way.

• Room occupancy by area and star/non-star accommodation. Occupancies varied across the

four areas – they were much higher in the City of Yogyakarta and DI Yogyakarta.

• Average guests per room. Available occupancy data related to rooms, rather than bed-spaces,

and the number of guests per room was required to translate arrivals (identified in Phase 1)

into room nights. A figure of 1.9 guests per room was used.4

• International and domestic guest splits by accommodation type.

Tables detailing these data and assumptions are shown in Appendix 1.

1.3.3. Phase 3: modelling Visitor Growth Projections

The third phase of the model involved estimating future growth of visitor numbers. Different ‘drivers’

were used for different market groups and forecasts were made for each period to 2045.

• Domestic staying visitors: the driver used to model future growth for domestic staying visitors

was the Horwath 2017 ‘Business as Usual’ and ‘Best Case Scenarios’.

• International visitors: the driver for international visitors was historic performance. An annual

growth rate was calculated for the main international source markets based on their relative

historic performance from 2011 (based on BPS data). Different markets grew at different

rates. This CAGR was then applied to future years, with the assumption that growth rates

would slow as the destination matures and the base of international visitors grows. The model

looks at two different scenarios with different international growth rates.

• Domestic day and VFR visitors: the driver used was, again, the Horwath 2017 ‘Business

as Usual’ and ‘Best Case Scenarios’.

3 No data was available on homestays in Yogyakarta and Prambanan. The supply figures used in the model were an assumption based on the same ratio of homestays to hotels as in Borobudur. 4 BPS Provinsi Jawa Tengah (2018) Statistik Tingkat Penghunian Kamar Hotel Provinsi Jawa Tengah 2017, Semarang: Badan Pusat Statistik


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Detailed rates of growth for the ‘Business as Usual’ and ‘Best Case’ scenarios are given in Appendix 1.

In summary, the CAGR for International arrivals to 2045 is 4.1%, and for all visitors to 2045 is 3.0%

under the Business as Usual Scenario. Under the Best Case scenario, CAGR for international arrivals is

6.13%, and for all visitors is 3.11%.

Government growth forecasts for international arrivals to Indonesia to 2045 are as shown below:

Table 1.1: Growth forecasts for international visits 2017 2020 2025 2030 2035 2040 2045

International Tourists (mn) 14.0 21.6 31.8 42.8 57.5 65.1 73.6

CAGR (per 5 years) 15.5% 8.04% 6.12% 6.08% 2.51% 2.54%

CAGR (2020-2045)

6.1%

Source: Bappenas (2019)

As a comparison, WTTC estimates that the total contribution of Travel & Tourism to GDP in Indonesia

(including wider effects from investment, the supply chain and induced income impacts) will increase

by 6.4% per annum to 2028.5 Thus, all estimates of growth appear to be reasonably consistent.

Having said that, these growth rates should be regarded as illustrative scenarios, since the baseline of

available tourism data and performance is far from perfect, and future visitor numbers will be

influenced by a complex range of factors that are impossible to quantify at this stage. These include

potential interventions in product development, marketing and infrastructure, economic performance

in source market countries, performance and development of competitor destinations, climate

change and its impacts on air travel, costs, and propensity to travel, and other global events and trends

such as wars and other forms of political instability.

1.3.4. Phase 4: Modelling Accommodation Projections

The fourth phase of the model translated the visitor growth projections into potential room nights.

The model had five potential areas for accommodation growth (Borobudur, Prambanan, City of

Yogyakarta, Metro Yogyakarta,6 and the rest of Joglosemar).

The model provided projections of hotel rooms for five-year periods to 2038 and then a seven-year

period through to 2045. Through these periods, the model makes assumptions about a number of

variables. These include:

• Average length of stay (ALOS). ALOS was split for domestic and international visitors. It was

initially based on the baseline data (Phase 2) with the assumption as that it would gradually

increase as the product offer developed to reach an average of 2.8 days for international

visitors and 2.1 days for domestic visitors by 2045.

• Room occupancy. This was also based on the baseline data and was assumed to gradually

increase to reach 70% room occupancy across the whole area by 2045.

5 WTTC (2018) Travel & Tourism Economic Impact 2018 Indonesia 6 ‘Metro Yogya’ consists of the most developed kecamatan around the periphery of the City of Yogyakarta, i.e. Kec. Sleman, Kec. Ngaglik, Kec. Ngemplak, Kec. Depok, Kec. Kalasan, Kec. Mlati in Kab. Sleman; Kec. Gamping, Kec. Kasihan, Kec. Sewon, Kec. Banguntapan in Kab. Bantul (see also map in Appendix 2).


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• The percentage of staying visits in hotels. Some staying visits are in homestay

accommodation. A level for this was calculated in the baseline analysis (Phase 2). This varied

slightly by area but typically around 90% of staying visits to the area were in hotels. The model

assumed that this level would remain constant moving forward to 2045.

• Number of guests per room. Based on the baseline data, the model assumed this would

remain constant.

• Distribution of visits across the five different areas (outlined above). Phase 3 of the model

identified the number of staying visits that the area may attract in the future. Staying visits

are not currently distributed evenly and the model made assumptions on where room-nights

(and therefore) rooms would be distributed in the future. This was initially based on the

baseline distribution of room nights (from Phase 2). Through time, the model assumed that

some room-nights would shift to other areas outside the Borobudur-Yogyakarta-Prambanan

area as infrastructure developed. These were a relatively small proportion – 5.95% of nights

in 2023 rising to 12% in 2045.

The inputs for the Phase 4 analysis are summarised in Appendix 1.

Using these variables, the model translated visits (from Phase 3) to new rooms required. New rooms

required was based on subtracting existing bedstock from overall rooms required (NB this applied only

to Borobudur, Prambanan, City of Yogyakarta, and Metro Yogyakarta. For other areas growth in visits

was assumed to translate to new rooms – i.e. there was no ‘soak up’ from existing bedstock).

1.3.5. Phase 5: Modelling Impacts

The final phase of the model is to translate the growth of visitors into direct and indirect spend and

potential employment impacts.

The process is as follows:

• Phase 4 of the model produces estimates of visitor nights (which are then translated into

rooms) for domestic and international visitors. These are broken down further (since different

groups have different spend levels). Domestic visitors are split into leisure trips and business

trips. The assumption has been that this ratio will stay unchanged from the baseline (i.e. 80%

leisure / 20% business). International nights are broken into areas on the basis of arrivals

(derived from Phase 3). The assumption (in the absence of other data) is that ALOS will be the

same across all international markets.

• Nights by market groups (domestic leisure/business, international by area) are then multiplied

by a figure of spend per day. The model assumes a modest increase in spend per visitor night

over the period of the plan. The percentage increases are shown in Appendix 1.

In terms of spend, available figures would again benefit from improvements and consistent data

collection by BPS. For example, they are not broken down by categories of visitor spend.

The model assumes a modest increase in spend per visitor night (shown in Appendix 1), while

multiplying visitor nights by spend per night provides an overall direct spend figure. We are not aware

of the existence of specific multipliers for the tourism sector for the study area. As such, direct spend

is translated into an estimate of indirect and induced spend by the application of a ratio derived from

the WTTC Travel and Tourism Economic Impact 2018 Indonesia report which highlights that 33% of

tourism spend is direct, 45.1% is indirect and 21.9% is induced. Therefore, for every $1 spent directly,

$2.03 are spent indirectly/induced.


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Similarly, the absence of spend breakdowns into discrete economic sectors and associated turnover

and employment cost for those sectors makes employment estimates difficult. Again, the model

applies a spend-to-employment ratio to the direct spend figures in order to provide an estimate of

direct employment in the sector, and to direct, indirect and induced spend to provide an estimate of

total employment.7 This gives a total ‘cost’ of USD 4,546 per job created, as shown in Table 1.2.

Table 1.2: Cost of creating jobs in tourism (direct and indirect)

Total direct contribution to GDP 2017 (IDR bn): 259,583.00

Total direct employment in tourism 2017 4,585,000

‘Cost' per job (direct) (IDR) 56,615,703

‘Cost’ per job (direct) (USD) 4,000

Total direct and indirect contribution to GDP (IDR bn) 787,100.00

Total direct/indirect employment 12,241,500

Cost' per job (IDR) 64,297,676

Cost per job ($) 4,546

It is likely that through time, the nominal 'cost' per job will increase as labour costs increase and

businesses introduce greater operational efficiencies. Based on the growth projections in the WTTC

report (to 2028), the model assumes that jobs grow at half the rate of expenditure.

Finally, the model provides an estimate of spend by broad economic sector. No comprehensive data

was available on the economic sectors in which visitors spend within the study area. As such, data is

drawn from the Malaysian Tourism Satellite Account 2018 (on the basis that Malaysia has a roughly

equivalent tourism economy). These are as shown in the table below:

Table 1.3: Estimate of spend according to economic sector (Malaysia example)

% share of spend

International Domestic Domestic Day

Shopping 33.5% 42.0% 42.0%

Accommodation 24.7% 9.5%

Transport 18.0% 7.0% 7.0%

Food and beverage

13.4% 15.5% 15.5%

Travel Agents 4.4%

Fuel

16.6% 16.6%

Other 6.0% 9.4% 18.9%

Source: Department of Statistics, Malaysia

7 The ratio is based on WTTC (2018) op. cit.


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1.3.6. Stakeholder engagement

In addition to the preparation of a model for forecasting growth and estimating impacts, the

Consultant carried out a wide range of consultative meetings with stakeholders in the ITMP. While

during the first stages of the programme, meetings were concerned primarily with collecting data on

the BYP area, later meetings have focused on sharing initial concepts and other information with

stakeholder bodies and refining the concepts in the light of feedback received.

Stakeholder bodies consulted in this way include:

• Bappenas

• Ministry of Tourism

• Pemda Jawa Tengah

• Bappeda DIY

• Bappeda Kab. Magelang

• Bappeda Kota Yogkarta

• Bappeda Kab. Klaten

• Dinas Pariwisata Kota Yogyakarta

• Dinas Pariwisata Kab. Sleman

• Dinas Pariwisata Kab. Magelang

• LitBangDa Magelang

• Geology Department UGM

• Kecamatan and Tourism representatives from Borobudur, Yogyakarta and Prambanan KTAs

• Dinas PUP ESDM, DI Yogyakarta

• Dinas Pertanahan dan Tata Ruang, DI Yogyakarta

• Cipta Karya

• DLH Magelang

• PDM Magelang

• TPS (Tim Pembangunan Prioritas) DI Yogyakarta

• BCO (Borobudur Conservation Office)

• BPCB

• BOB (Badan Otorita Borobudur)

• UNESCO

Further meetings with stakeholders were requested, but in some cases, responses proved impossible

to obtain, or when the Consultant arrived at the specified time the stakeholder had been called away

to another meeting. A further challenge has been the frequent change of personnel in Indonesian

government departments (as noted in the Baseline Analysis Report).

An indicative list, with dates of meetings, is included in Appendix 3.


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2. Growth Projections

2.1. Population projections The resident population in Central Java and DI Yogyakarta is forecast to grow steadily on an annual basis in line with population growth generally in Indonesia (Table 2.1).

Table 2.1: Population Projections Population 2018 2023 2028 2033 2038 2045

Kec. Kotagede 33,508 35,213 36,719 38,011 39,084 42,205

Kec. Kraton 17,575 18,469 19,259 19,937 19,500 21,088

Kec. Danurejan 19,128 20,101 20,961 21,699 22,311 22,951

Kec. Gondomanan 13,697 14,394 15,010 15,538 15,976 16,435

Kec. Ngampilan 17,031 17,898 18,663 19,320 19,865 20,435

Kec. Gedongtengen 18,388 19,324 20,150 20,859 21,488 22,063

Total KTA Yogyakarta 119,327 125,399 130,762 135,364 139,224 145,177

Kota/TDA Yogyakarta 419,185 440,515 459,359 475,518 497,968 502,969

Kab. Kulon Progo 425,744 472,930 518,353 560,992 599,839 642,545

Kab. Bantul 1,006,226 1,057,429 1,102,661 1,141,448 1,173,679 1,207,347

Kab. Gunung Kidul 704,026 739,852 810,910 862,701 887,058 912,509

Kab. Sleman 1,207,134 1,268,561 1,322,824 1,369,355 1,408,022 1,448,412

Total DI Yogyakarta 3,762,315 3,979,287 4,214,107 4,410,014 4,566,566 4,713,782

Kec. Prambanan-Sleman 53,090 55,792 58,178 60,225 61,925 63,701

Kec. Prambanan-Klaten 51,133 53,159 55,433 57,383 59,003 60,280

Total KTA/TDA Prambanan

104,223 108,951 113,611 117,608 120,928 123,981

Kab. Klaten 1,180,259 1,240,318 1,293,373 1,338,868 1,376,674 1,416,164

Kab. Magelang 1,274,881 1,339,755 1,386,266 1,446,207 1,487,043 1,529,700

Kab. Boyolali 985,313 1,035452 1,079,744 1,117,725 1,149,286 1,182,254

Kab. Sukoharjo 888,048 933,238 973,158 1,007,389 1,035,835 1,065,548

Kab. Semarang 1,038,806 1,091,667 1,138,364 1,178,406 1,211,681 1,246,438

Kab. Temanggung 767,489 806,544 841,044 870,628 895,212 920,892

Kota Magelang 122,812 129,061 134,582 139,316 143,250 147,359

Kota Surakarta 521,786 548,338 571,794 591,907 608,620 626,079

Kota Salatiga 191,009 200,729 209,315 216,678 222,796 229,187

Kota Semarang 1,777,045 1,867,472 1,947,355 2,015,854 2,072,775 2,132,234

Total Joglosemar 12,156,482 12,776,287 13,319,917 13,840,126 14,278,140 14,720,226

Total Central Java 34,635,181 36,397,647 37,954,575 39,289,648 40,399,059 41,557,933

Kec. Borobudur 59,476 62,503 68,506 72,881 74,939 77,089

Kec. Mungkid 75,933 79,797 87,461 93,047 95,674 98,419

Total KTA Borobudur 135,409 142,300 155,967 165,928 170,613 175,508

Kec. Tempuran 49,109 51,608 56,565 60,177 61,876 63,652

Kec. Mertoyudan 113,526 119,303 130,761 139,113 143,040 147,144

Kec. Muntilan 78,258 82,240 90,139 95,896 98,603 101,433

Total TDA Borobudur 376,302 395,451 433,432 461,114 474,133 487,737

Source: BPS Indonesia population statistics and World Bank Population Estimates and Projections8

8 https://datacatalog.worldbank.org/dataset/population-estimates-and-projections

https://datacatalog.worldbank.org/dataset/population-estimates-and-projections


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It should be noted that there are slight differences between the figures shown in the Baseline Analysis

Report and the current report because of differences in how statistics are collected by different

government bodies. Overall, the population of the two provinces where BYP is located is expected to

grow by a total of approximately 7,874,219 between 2018 and 2045 (Figure 2.1).9

Figure 2.1: Overall total population growth for Central Java/DI Yogyakarta

As established in the Baseline study, in both DI Yogyakarta and Central Java the proportion of residents aged over 65 is higher than in other provinces of Indonesia and this proportion will increase over time. At the same time household sizes are gradually declining in both provinces due to declining birth-rates and possibly to out-migration. Notwithstanding the higher than average proportion of people aged over 65, the majority of the

population in the three TDAs is aged 39 or younger, thus ensuring a ready labour supply in the

foreseeable future. Interventions to stimulate tourism growth will help to provide work for people in

the productive age-range and will help to counter a tendency towards out-migration. Any growth in

tourism will thus alleviate unemployment, and the declining unemployment rate will enhance GRDP.

Also, the tourism opportunities offered at community level may help to counter population decline

due to rural out-migration, especially from peripheral areas such as Gunung Kidul.

It is often a concern that tourism developments will create a ‘magnet effect’, drawing people from

outside the area who may place greater strain on water and other environmental resources and

develop the available entrepreneurial opportunities in the place of local people who may have less

experience. In the case of Central Java and DI Yogyakarta, however, the resident population has

proved to be capable of taking advantage of tourism-related opportunities, at least on a small scale

and catering to domestic tourists. This is evidenced by successful initiatives such as the Breksi Cliff

attraction in Kec. Prambanan-Sleman and the Twin Temples Fesitval at Plaosan in Kec. Prambanan-

Klaten. The Desa Wisata of Kampoeng Mataram in Kec. Sewon, Kab. Bantul; Candirejo in Kec.

Borobudur; and Penting Sari in Kec. Cangkringan, Kab. Sleman, are also good examples of where the

communities have themselves created products which appeal to different market segments (mainly

domestic, although with some interest from foreign tourists too).

9 The SUPAS 2018 report, based on a 2015 survey, has a different set of figures. Unfortunately the SUPAS figures could not be used as they are only available at province level, whereas a greater degree of granularity is required for the ITMP.


11

In addition, local communities have competently responded to the demand for ‘Instagramable’

attractions, for instance by developing numerous ‘selfie spots’ throughout the region, including

‘sunrise spots’ and ‘sunset spots’ in the hills around the Borobudur Temple World Heritage Site (WHS).

2.2. Visitor arrivals projections

Forecasts for tourist arrivals to the TDAs and surrounding areas are based upon historical growth rates and the following assumptions:

• Growth rates in Indonesian tourism have been particularly high over the period 2010-18 compared with the previous decade, when there was considerable socio-political-economic disruption early in the decade followed by the Bali bombings in 2002 and 2005 (see Figure 2.2).

Figure 2.2: International arrivals to Indonesia 1995-2018

Source: Baseline Analysis Report

• It is expected that future growth rates will be lower than during the period 2010-18 because

of factors affecting the international economy, including the slowdown in growth rates of the

Chinese and Indian economies; the trade war between the US and China; and shifting trading

linkages as countries review their alliances (for example the UK’s exit from the European

Union).

• Other countries also see tourism as an important contributor to their foreign exchange

earnings, which will result in significant competition for market share.

• International propensity to travel by air, in particular long-haul, may decline due to rising costs

of air fares because of the internalization of the environmental costs of travel, and because of

the growing awareness of the contribution of air travel to climate change.

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

16,000,000

18,000,000

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

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20

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20

09

20

10

20

11

20

12

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20

14

20

15

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20

18


12

• Indonesia’s programme of emphasizing tourism as an engine of growth in many parts of the

country (in particular through ITMP programmes in ten areas, including BYP) means that all of

these areas will be competing for international market share.

• The BYP area has some strong attractions which can compete on a global scale, in particular

the WHS of Borobudur, Prambanan and Sangiran and – potentially, if better managed – the

historic cities of Yogyakarta and Surakarta and their associated intangible cultural heritage.

However, many of its other existing and potential attractions (beach resort tourism, lakes,

activity and ecotourism opportunities, folk culture) compare less favourably on an

international scale with attractions elsewhere in Southeast Asia and the rest of the world and

are more likely to appeal to a domestic market.

• Indonesia is fortunate in having a robust and expanding domestic market, reflecting the

healthy state of the national economy. This indicates that the domestic market for BYP will

continue to be strong, which provides an extremely positive way of supporting employment

and redistributing wealth from ‘core’ urban and industrialised areas to ‘peripheral’ rural and

underdeveloped areas.

The Consultant is aware that there are considerable aspirations for the contribution to Indonesia’s

international tourism arrivals and foreign exchange earnings from the BYP and other ITMPs. However,

the team advises a cautious approach because of the above factors. The tables below reflect this

realistic approach.

Tables 2.2-2.4 show the projected visitor growth in numbers from the principal markets, based on

data from the 2017 ‘Demand Assessment’ by Horwath HTL.10 For this, our assumption is that the

‘Business as Usual’ scenario is based on organic market growth with no significant interventions. This

is slightly more positive than the Horwath assumption, which is that growth will gradually slow down

due to lack of capacity in the destination and the slowing down of the domestic population growth

rate. The ‘Best Case’ scenario assumes that growth in international markets will be strong as

infrastructure, services and products at the market gradually improve through public and private

sector investment.

10 Horwath HTL (2017) Lombok/Borobudur-Yogyakarta-Prambanan/Lake Toba Baseline Supply and Demand, market demand forecasts, and investment needs (hereafter: ‘Demand Assessment’, as per MPWH Environmental and Social Management

Framework)


13

Table 2.2: Visitor growth (domestic and international) – ‘Business as Usual’ Scenario 2018 2023 2028 2033 2038 2045

Total staying visitors

5,229,298 6,692,055 7,432,722 7,995,316 8,523,029 9,327,938

Domestic (staying hotels/guesthouses)

4,831,347 6,113,195 6,683,549 7,094,303 7,530,300 8,186,078

Leisure and culture 3,861,854 4,886,477 5,342,380 5,670,708 6,019,215 6,543,400

MICE 969,493 1,226,718 1,341,170 1,423,595 1,511,085 1,642,678

Day visits / VFR 7,000,000 7,883,137 8,244,321 8,494,637 8,752,552 9,126,843

International 397,951 578,860 749,173 901,013 992,728 1,141,860

Europe, USA & Australia

203,303 299,912 385,694 458,045 499,963 565,679

ASEAN 117,554 149,506 173,922 192,495 202,571 217,578

Other Asia & MENA 77,094 129,442 189,173 250,473 290,194 358,603

Table 2.3: Visitor growth (domestic and international) – ‘Best Case’ Scenario 2018 2023 2028 2033 2038 2045

Total staying visitors

5,229,298 7,076,355 8,322,671 9,532,127 10,897,816 12,865,382

Domestic (staying hotels/ guesthouses)

4,831,347 6,474,467 7,469,317 8,368,721 9,376,424 10,994,277

Leisure and culture 3,861,854 5,175,253 5,970,469 6,689,392 7,494,882 8,788,085

MICE 969,493 1,299,214 1,498,848 1,679,329 1,881,542 2,206,192

Day visits / VFR 7,000,000 8,117,854 9,184,607 10,140,548 11,195,984 12,425,806

International 397,951 601,888 853,354 1,163,407 1,521,392 1,871,104

Europe, USA & Australia

203,303 299,913 398,586 498,259 493,558 672,508

ASEAN 117,554 149,506 177,407 202,347 223,983 240,589

Other Asia & MENA 77,094 152,469 277,361 462,801 703,851 958,007

Source: Consultant’s calculation based on Baseline Report, Horwath HTL op. cit., UNWTO11

The tables above indicate that numbers of foreign tourists are expected to increase from the current

total of just under 400,000 per annum to reach 1.14 million by 2045 through organic growth (Business

as Usual) if nothing is done to stimulate further arrivals, or 1.87 million with appropriate interventions

and increasing market interest under the Best Case scenario. The strongest growth is likely to come

from ASEAN and other Asian markets, especially China and India, rather than from the more mature

European, North American and Australian markets.

Meanwhile, domestic staying tourists are expected to increase from the current 4.8 million to 8.16

million under an organic growth scenario, and 10.99 million under the Best Case scenario. For

domestic visitors, we calculate that 20% are MICE visitors, on the basis of our research for the Baseline

Analysis Report (Yogyakarta is a popular city for conferences because of the high number of Higher

Education Institutions located there).

11 UNWTO/GTERC (2014) Asia Tourism Trends. Madrid: UNWTO


14

In addition, we see significant growth amongst day-visitors and the VFR category as the population of

Joglosemar becomes increasingly prosperous and aspirational in terms of seeking recreational

opportunities, and as people travel more widely to visit friends and relatives, from an estimated 7

million per year to 9.1 million under the Business as Usual scenario and 12.4 million under the Best

Case scenario. The importance of the domestic markets is explained in Section 2.1.2 below.

Tables 2.4 and 2.5 take the above growth scenario projections forward into the number of nights

expected to be spent in the destination by staying visitors. This is based on the assumption that the

Average Length of Stay (ALOS) will show no growth in the ‘Business as Usual’ scenario, at 1.4 days in

Borobudur and Prambanan (the lowest in the destination) and 2.3 in Yogyakarta (the highest in the

destination), while in the Best Case scenario the average number of nights will increase for foreign

visitors from 1.4 days in Borobudur and Prambanan, 2.1 days in Metro Yogyakarta and the rest of

Joglosemar, and 2.3 days in Kota Yogyakarta to 2.8 days across the destination.

Meanwhile, ALOS for domestic visitors is again expected to remain static in the Business as Usual

scenario, at 1.4 in Borobudur and Prambanan KTAs, 1.6 in Kota Yogyakarta, and 2 in the rest of

Joglosemar. In the Best Case scenario, ALOS is expected to increase for domestic visitors at a slower

rate than for international visitors to 2.1 across the destination by 2045.

The increases in ALOS for both foreign and domestic markets will be due to the expected

interventions, that will encourage people to stay longer because there is more to do, while the greater

rate of increase for international visitors will be largely due to the expansion in air access due to YIA

(Yogyakarta International Airport), and to increased promotion of the opportunities in Joglosemar

linked with expansion of the product offer.

Table 2.4: Expected Visitor Nights in Destination - ‘Business as Usual’ Scenario

Table 2.5: Expected Visitor Nights in Destination - ‘Best Case’ Scenario Baseline 2023 2028 2033 2038 2045

Total Staying Visitors 9,899,938 12,173,293 15,731,090 18,985,445 23,103,774 28,327,075

Domestic Overnight 9,003,550 10,865,808 13,721,655 16,068,866 19,046,819 23,087,982

International Overnight 896,388 1,307,485 2,009,487 2,916,520 4,056,794 5,239,093

Source: Consultant’s calculation

Table 2.6: Growth in International Arrivals as Proportion of Total Visitors 2018 2023 2028 2033 2038 2045

Business as usual 7.60% 8.60% 10.10% 11.30% 11.60% 12.20%

Best Case 7.60% 8.50% 10.30% 12.20% 14.00% 14.50%

Baseline 2023 2028 2033 2038 2045

Total Staying Visitors 9,899,938 11,516,964 14,042,228 15,880,590 17,943,935 20,387,972

Domestic Staying 9,003,550 10,259,501 12,278,074 13,621,815 15,296,778 17,190,763

International Staying 896,388 1,257,462 1,764,075 2,258,468 2,646,848 3,197,208


15

Figure 2.3: Growth in International Arrivals as Proportion of Total Visitors

The implications of visitor growth are illustrated in Table 2.6 and Figure 2.3 above. We expect the

number of foreign visitor arrivals as a proportion of total arrivals to increase from 7.6% currently to

12.2% under the ‘Business as Usual’ scenario, although with a levelling off towards the end of the

period due to the failure to rejuvenate the destination, as predicted by the Tourism Area Life Cycle

model described earlier in this report. Under the Best Case Scenario, international arrivals are

expected to increase to 14.5% as a proportion of the total. This is the logical course as the destination

becomes better known in international markets.

2.3. The significance of domestic tourists

We include here a reminder of the importance of domestic tourists to the visitor economy.

The role of domestic tourists – especially the youth market – in spearheading tourism development

should not be underestimated, especially where more remote areas or peripheral areas are

concerned. The worth of international backpackers in this regard has been recognised for many years,

with destinations ‘discovered’ by them later taken up and developed for wealthier and more formally

organised visitor categories. Nowadays, in an increasingly wealthy country such as Indonesia, it is

aspirational young professionals and students – often with their own means of transport – who

perform this role. In Yogyakarta and its immediate surroundings there are approximately 400,000

students, who are often pioneers of up-and-coming destinations.

In the BYP area and surroundings, for example, attractions such as Kali Biru (Kab. Kulon Progo),

Punthuk Sethumbu (Kec. Borobudur), Gereja Sayidan (Kec. Gondomanan, Kota Yogyakarta), and Mt.

Nglanggeran (Kab. Gunung Kidul) have come to prominence thanks to the energy of young people

keen to explore new areas. Not only does this help to stimulate local entrepreneurial responses, but

it gives local people a non-formal type of experiential, on-the-job learning in tourism which they can

later put to good use in catering to a more demanding international market.

0%

2%

4%

6%

8%

10%

12%

14%

16%

2018 2023 2028 2033 2038 2045

Business as usual Best Case


16

Domestic demand and supply is also responsible for developing not just small-scale attractions and

resorts but some reasonably large-scale initiatives. For instance, domestic tourists from Yogyakarta

now flock in considerable numbers at weekends to the beaches at the southern end of the Gunung

Sewu Geopark (south of Wonosari), where the yellow sands and rocky outcrops form pretty, sheltered

bays.

A further important factor in providing a varied product which appeals to the domestic market is to

retain the value of local spend by encouraging Indonesians not to travel abroad to spend their

disposable income but instead take ‘staycations’ within their own country – thus reducing the amount

of Indonesia-earned income which leaves the national economy, and helping to reduce the current

account deficit.

2.4. Implications for Accommodation Provision

Growth in visitor arrivals will stimulate an increase in the number of hotel and guesthouse rooms

required. We have attempted to quantify the projected additional rooms required under the growth

scenarios outlined above, although as stated in the Baseline Analysis Report, this is challenging due to

the weakness of tourism-related data collected by the public sector in terms of its thoroughness and

consistency, and to the fact that much of the commercial accommodation used – especially by

domestic tourists – is unregistered, principally under the ‘kost’ system of informal guesthouses.

To carry out our calculations we assume that the ALOS will gradually increase (as discussed above in

the Methodology section), and that occupancy rates in hotels and guesthouses will also increase.

Annual occupancy levels are currently low, at around 40%-65%, with the lowest levels in Borobudur

and Prambanan and the highest in star-rated hotels in the City of Yogyakarta. The variation is due to

the fact that accommodation in the Borobudur and Prambanan KTAs is mainly used at weekends,

while in Yogyakarta there is less variation in occupancy across the week because of greater use by

business visitors and because of the MICE sector, with hotels often using these markets to fill rooms

on weekdays. Homestay-style accommodation shows extremely low rates, sometimes as low as 15%,

which is a reflection of how village-based accommodation does not meet the standard expected by

either foreign or domestic markets.

Tables 2.7 and 2.8 show the additional rooms required in both star-rated and non-star-rated hotels

and guesthouses combined. For 2023 in the ‘Business as Usual’ scenario, a negative figure appears

overall because we expect occupancy rates to increase over the period, while in the first 5 years or so

there will be no rooms required overall in BYP because of existing over-capacity in Yogyakarta. Under

the Best Case scenario hotels and guesthouses will more quickly achieve better occupancy rates and

more investment will be needed to build more accommodation.

Our calculations show that under the Business as Usual scenario, an additional 8,321 rooms will be

needed by 2045 throughout BYP to cope with an organic growth in the visitor market, while under the

Best Case scenario an additional 21,240 rooms would be needed. These calculations do not take

account of probable take-up of room capacity in other parts of Joglosemar, especially Solo and

Magelang, which are the cities closest to BYP.


17

Table 2.7: Additional rooms required (Business as Usual)

Additional Accommodation Required (Rooms)

Total Borobudur

TDA Prambanan

TDA City of

Yogyakarta Metro

Yogyakarta

Baseline n/a

2023 415 352 109 122 (168)*

2028 3,277 758 240 1,498 781

2033 4,132 1,084 335 2,037 676

2038 4,919 1,442 426 2,427 624

2045 8,321 1,825 497 4,871 1,128

*This figure is negative because of current low occupancy levels in the immediate area around the

City of Yogya; we expect increased arrivals to take up some of this spare capacity.

Table 2.8: Additional rooms required (Best Case)

Additional Accommodation Required (Rooms)

Total Borobudur Prambanan City of

Yogyakarta Metro

Yogyakarta

Baseline n/a

2023 1,853 480 135 1,076 163

2028 6,654 1,074 309 3,683 1,588

2033 9,815 1,659 465 5,720 1,972

2038 13,479 2,378 640 7,953 2,508

2045 21,240 3,245 816 13,302 3,876

2.5. Economic impact projections In planning for both international and domestic tourists, our approach is based on an increased length

of stay and visitor spend in both categories. An increased length of stay will result in greater spend

per trip, therefore contributing greater economic benefits to the region. This also has the benefit of

reducing the environmental impacts of tourism because the major environmental costs of tourism are

normally incurred in travelling to and from a destination.

The tables below also take into account the strength and diversity of the Indonesian economy, which

means that the great majority of goods and services needed to supply the tourism sector can be

sourced within the country. This results in relatively low leakages and a significant multiplier effect

because of indirect and induced spending as well as direct spending by tourists: for instance, the WTTC

estimates that just 12% of travel and tourism spending leaks out of the economy through imports.12

Here again, the domestic market is as significant as the international market – indeed probably more

so, as local visitors may have less demand for imported goods and more interest in purchasing locally-

made souvenirs and local food.

12 WTTC (2017) Indonesia Travel & Tourism Benchmarking Report


18

There are two sources of information on expenditure for domestic visitors – the Horwath HTL report

already referred to (pg. 29), and the Baseline Report for the ITMP, which draws data from Statistics of

Domestic Tourist Profile 2016 (BPS) and from the Visitor Behaviour Survey carried out for the study.

The BPS data has been used for Overnight visits since it has been judged to be more accurate than the

Horwath data (although the values are relatively close), while data from the Visitor Behaviour Survey

data has been used for day visits since, again, it is judged to be more realistic than the Horwath data

(although, again, the values are relatively close).

No spend figures exist for MICE visitors. We have assumed spend to be similar to domestic overnight

visitors but have increased accommodation and food & beverage spend. Average spend per day for

international visitors is taken from the BPS Passenger Exit Survey (2016). We are not aware of the

existence of specific multipliers for the tourism sector for the study area, and so direct spend has been

translated into an estimate of indirect and induced spend by applying a ratio derived from the WTTC

Travel and Tourism Economic Impact 2018 Indonesia report (pg. 6) which highlights the following

spend breakdown:

• Direct: 33%

• Indirect: 45.10%

• Induced: 21.90%

Therefore, every $1 spent directly in the local economy creates a further value of $2.03 in indirect and

induced spend.

2.5.1. Visitor Expenditure Forecasts

Tables 2.9 and 2.10 illustrate the expected forecast expenditure by all visitors (international and

domestic, overnight and day/VFR visitors) in terms of direct expenditure and in terms of indirect and

induced expenditure. These calculations show that under the Business as Usual scenario, the tourism

sector is likely to contribute a total of USD 4,157 million per annum to the economy of Central Java

and DI Yogyakarta by 2045, while according to the Best Case scenario, tourism should generate USD

6,100 million for the economy (direct, indirect and induced spend).

Table 2.9: Forecast expected expenditure by all visitors (Business as Usual)

Spend ($m) 2018 2023 2028 2033 2038 2045

Direct spend 432 586 794 985 1,172 1,372

Domestic Overnight 231 297 392 469 553 621

International Overnight 87 144 234 330 417 540

Day Visitors/VFR 115 145 168 186 202 210

Total Spend (direct, indirect and induced )

1,311 1,777 2,406 2,986 3,551 4,157

Domestic Overnight 701 899 1,188 1,420 1,676 1,883

International Overnight 262 437 709 1,001 1,264 1,637

Day Visitors/VFR 347 441 509 565 612 638

Note: Some figures appear not to add up exactly because input figures have been rounded up or down.


19

Table 2.10: Forecast expected expenditure by all visitors (Best Case) Spend ($m) 2018 2023 2028 2033 2038 2045

Direct spend 432 614 892 1,204 1,590 2,013

Domestic Overnight 231 314 438 553 689 835

International Overnight 87 150 267 429 643 892

Day Visitors/VFR 115 150 187 222 258 287

Total Spend direct, indirect and induced )

1,311 1,861 2,704 3,648 4,818 6,100

Domestic Overnight 701 952 1,328 1,675 2,086 2,529

International Overnight 262 455 810 1,299 1,949 2,703

Day Visitors/VFR 347 454 567 674 782 868

2.5.2. Contribution of tourism to Gross Regional Domestic Product (GRDP)

From the visitor spend figures, we can predict approximately the contribution of the tourism sector

to GRDP in Central Java and DI Yogyakarta. We forecast a total contribution (direct, indirect and

induced) of USD 3,659 million by 2045, with the proportionate contribution of the sector to rise from

the current level of 0.38% to 0.47% by 2045 under the Business as Usual scenario. Under the Best Case

scenario, a total contribution of USD 5,363 million, with a proportionate contribution of the sector of

0.69%.

These figures appear relatively low as a proportion of GRDP because of the strength of other sectors

in the Central Java and DI Yogyakarta economy (the proportionate contribution of the same number

of visitor arrivals in many other parts of Indonesia could be much higher where the economy is less

strong and diversified). The figures are expressed in more detail in Tables 2.11 and 2.12 below. In the

business-as-usual scenario, the GRDP growth will be 3.83% constant from 2023 to 2045.


20

Table 2.11: Forecast Tourism Sector Contribution to GRDP of Central Java and DI Yogyakarta (Business as Usual)

2018 2023 2028 2033 2038 2045

Total GRDP (in $ m) 99,898

120,523

145,406

175,425

211,643

275,245

GRDP growth (yoy %) 3.83% 3.83% 3.83% 3.83% 3.83%

Total tourism spend staying in the economy

1,311

1,777

2,406

2,986

3,551

4,157

Direct 432 586 794 985 1,172 1,372

Domestic 231 297 392 469 553 621

International 87 144 234 330 417 540

Day/VFR 115 145 168 186 202 210

Indirect 878 1,190 1,612 2,001 2,379 2,785

Domestic 469 602 796 951 1,123 1,262

International 176 293 475 671 847 1,096

Day/VFR 233 295 341 378 410 427

% Share of GRDP

Total tourism spend staying in the economy 1.31% 1.47% 1.65% 1.70% 1.68% 1.51%

Direct contribution of tourism to GRDP 0.43% 0.49% 0.55% 0.56% 0.55% 0.50%

Domestic 0.23% 0.25% 0.27% 0.27% 0.26% 0.23%

International 0.09% 0.12% 0.16% 0.19% 0.20% 0.20%

Day/VFR 0.11% 0.12% 0.12% 0.11% 0.10% 0.08%

Indirect & induced contribution of tourism to GRDP 0.88% 0.99% 1.11% 1.14% 1.12% 1.01%

Domestic 0.47% 0.50% 0.55% 0.54% 0.53% 0.46%

International 0.18% 0.24% 0.33% 0.38% 0.40% 0.40%

Day/VFR 0.23% 0.24% 0.23% 0.22% 0.19% 0.16%

In the Best Case scenario (Table 2.12), GRDP growth will expand stronger by 3.84% annually in 2023, 3.85% in 2028, 3.86% in 2033, 3.87% in 2038, and 3.84% in 2045. The best-case scenario shows a higher prospect, and the differences between the two scenarios are 0.01% in 2023, 0.03% in 2028, 0.04% in 2033, 0.05% in 2038, and 0.02% in 2045.


21

Table 2.12: Forecast Tourism Sector Contribution to GRDP of Central Java and DI Yogyakarta (Best Case)

2018 2023 2028 2033 2038 2045

Total GRDP (in USD m)

99,898

120,607

145,704

176,087

212,909

277,187

GRDP growth (yoy %) 3.84% 3.85% 3.86% 3.87% 3.84%

Additional growth with intervention (yoy %) 0.01% 0.03% 0.04% 0.05% 0.02%

Total tourism spend staying in the economy 1,311 1,861 2,704 3,648 4,818 6,100

Direct 432 614 892 1,204 1,590 2,013

Domestic 231 314 438 553 689 835

International 87 150 267 429 643 892

Day/VFR 115 150 187 222 258 287

Indirect 878 1,247 1,812 2,444 3,228 4,087

Domestic 469 638 889 1,122 1,398 1,695

International 176 305 542 870 1,306 1,811

Day/VFR 233 304 380 452 524 582

% Share

Total tourism spend staying in the economy 1.31% 1.54% 1.86% 2.07% 2.26% 2.20%

Direct contribution of tourism to GRDP 0.43% 0.51% 0.61% 0.68% 0.75% 0.73%

Domestic 0.23% 0.26% 0.30% 0.31% 0.32% 0.30%

International 0.09% 0.12% 0.18% 0.24% 0.30% 0.32%

Day/VFR 0.11% 0.12% 0.13% 0.13% 0.12% 0.10%

Indirect & induced contribution of tourism to GRDP 0.88% 1.03% 1.24% 1.39% 1.52% 1.47%

Domestic 0.47% 0.53% 0.61% 0.64% 0.66% 0.61%

International 0.18% 0.25% 0.37% 0.49% 0.61% 0.65%

Day/VFR 0.23% 0.25% 0.26% 0.26% 0.25% 0.21%

The indexed figures for both sets of tables are given in Appendix 3.

We have calculated the growth of Central Java and DI Yogyakarta’s GRDP based on current prices

(Table 2.13), which had a growth rate of 11.05% in 2011, 8.88% in 2012, 10% in 2013, 10.97% in 2014,

9.56% in 2015, 7.63% in 2016, 7.87% in 2017, and 8.29% in 2018. The compound annual growth rate

(CAGR) was 9.20% throughout the period of 2010-2018.13

13 Historical inflation rates for the period are given in Appendix 3.


22

Table 2.13: Central Java and DI Yogyakarta GRDP (based on current prices) Year GRDP of C Java (in

IDR million)

GRDP of DIY

(in IDR million)

Total GRDP

(in IDR million)

Growth

2010 623,224,621 64,678,968 687,903,590

2011 692,561,627 71,369,958 763,931,586 11.05%

2012 754,529,436 77,247,861 831,777,297 8.88%

2013 830,016,016 84,924,543 914,940,559 10.00%

2014 922,471,181 92,842,484 1,015,313,665 10.97%

2015 1,010,986,637 101,440,518 1,112,427,156 9.56%

2016 1,087,316,683 109,962,354 1,197,279,036 7.63%

2017 1,172,400,482 119,131,000 1,291,531,482 7.87%

2018 1,268,700,966 129,877,458 1,398,578,424 8.29%

CAGR 9.20%

2.5.3. Impact of Tourism Expenditure on other economic sectors

We have also calculated the impact of tourism growth on other economic sectors in Central Java and

DI Yogyakarta provinces as an outcome of tourism development in the three TDAs.

Our assumptions for impacts on the Agriculture, Wholesale and Retail, and other sectors are as

follows:14

1. The agriculture sector gains $133,000 for every $1 million of direct spending on the tourism

sector.

2. The wholesale and retail sector gains $84,000 for every $1 million of direct spending on the

tourism sector.

3. “Other sectors” are defined as sectors in three different categories:

• The direct contribution of travel and tourism to GDP reflects the ‘internal’ spending on

travel and tourism (in particular spending on travel and tourism by residents and non-

residents for business and leisure purposes) as well as the government’s 'individual'

spending, i.e. travel and tourism services directly linked to visitors, such as cultural

amenities (e.g. museums) or recreational (e.g. trails in national parks). Sectors/industries

in this category are: accommodation services, food and beverages, retail trade,

transportation services, cultural, sports and recreational.

• The indirect contribution includes: travel-and-tourism investment spending, government

‘collective’ travel-and-tourism spending, impacts of purchases from suppliers.

• The induced contribution includes: food and beverages, recreation, clothing, housing,

household goods.

14 Assumptions are based on WTTC (2018), op. cit.


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According to the WTTC Indonesia Report, in 2018 the tourism sector contributed around 5.8% to

“other sectors,” and was projected to grow to 6.6% by 2028. From this projection, we can calculate

the expected growth of the tourism sector annually by dividing the difference between the present

and projected rates by the number of years (between 2018 and 2028, i.e., 10 years). This gives a 0.08%

growth rate per year from 2018 to 2028, and allows a projection of the tourism sector’s contributions

to “other sectors”.

The projected annual impacts of tourism spend on different sectors are shown in Tables 2.14 and 2.15

below.

Table 2.14: Tourism Sector Economic Impacts on other sectors (Central Java and DI Yogyakarta) Business as Usual scenario (USD million)

Baseline 2023 2028 2033 2038 2045

Direct spending on tourism sector 432 586 794 985 1,172 1,372

Induced revenue on other sectors impacted by tourism sector

25 36 52 69 87 109

Induced revenues on agriculture sector 58 78 106 131 156 182

Induced revenues on wholesale and retail sector

36 49 67 83 98 115

Table 2.15: Tourism Sector Economic Impacts on other sectors (Central Java and DI Yogyakarta) Best Case scenario (USD million)

Baseline 2023 2028 2033 2038 2045

Direct spending on tourism sector 432 614 892 1,204 1,590 2,013

Induced revenue on other sectors impacted by tourism sector

25 38 59 84 118 160

Induced revenues on agriculture sector 58 82 119 160 211 268

Induced revenues on wholesale and retail sector

36 52 75 101 134 169

These calculations indicate that under a Business as Usual / organic growth scenario, there will be various direct and induced impacts annually on other economic sectors in Central Java and DI Yogyakarta while under the Best Case scenario, with interventions to improve tourism attractions and infrastructure will produce higher direct and induced annual impacts.


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2.5.4. The impact of tourism spend on employment

Besides its contribution to other sectors discussed above, the tourism sector also impacts the growth

of employment in Indonesia. As with other aspects of economic forecasting, the absence of spend

breakdowns into discrete economic sectors and associated turnover and employment cost for those

sectors makes employment estimates difficult. Our model applies a spend-to-employment ratio to the

direct spend figures to provide an estimate of direct employment in the tourism and hospitality sector,

and to direct, indirect and induced spend to provide an estimate of total employment. This ratio is

based on data from the WTTC Travel and Tourism Economic Impact 2018 Indonesia (Table 2.16).

Table 2.16: Estimated job creation through visitor spend

Total direct contribution to GDP 2017 (IDR bn): Rp. 259,583.00

Total direct employment in tourism 2017 4,585,000

‘Cost' per job (direct) (IDR) Rp. 56,615,703

‘Cost’ per job (direct) ($) USD 4,000

Total direct and indirect contribution to GDP (IDR bn) Rp. 787,100.00

Total direct/indirect employment 12,241,500

Cost per job (IDR) Rp. 64,297,676

Cost per job ($) USD 4,546

It is likely that through time, 'cost' per job will increase as labour costs increase and businesses

introduce greater operational efficiencies. Based on the growth projections in the WTTC report (to

2028), the model assumes that jobs grow at half the rate of expenditure.

Besides its contribution to other sectors discussed above, the tourism sector has also impacted the

growth of employment in Indonesia. According to the 2017 WTTC Travel and Tourism Impacts in

Indonesia Report, it was found that for every $1,000,000 spending on the tourism sector, 198 jobs

were supported (consisting of 34% from direct sectors, 42% from indirect sectors, and 24% from

induced sectors**). These assumptions become the basis on which the projection of tourism sector’s

impact on increasing employment is conducted.

Table 2.17 Tourism Sector’s Impact on Employment - Business as usual scenario (in $ million)

Baseline 2023 2028 2033 2038 2045

Direct spending in tourism sector

432 586 794 985 1.172 1.372

Domestic 231 297 392 469 553 621

International 87 144 234 330 417 540

Domestic stay 115 145 168 186 202 210

Number of Jobs Provided in tourism sector

85,629 116,093 157,199 195,107 232,042 271,647

Direct 28,976 39,284 53,194 66,021 78,519 91,921

Indirect 36,328 49,252 66,691 82,773 98,442 115,244

Induced 20,326 27,557 37,315 46,313 55,081 64,482

Growth of jobs in tourism sector (yoy%)

6.28% 6.25% 4.42% 3.53% 2.28%


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Table 2.18 Tourism Sector’s Impact on Employment - Best case scenario

Baseline 2023 2028 2033 2038 2045

Direct spending in tourism sector

432 614 892 1.204 1.590 2.013

Domestic 231 314 438 553 689 835

International 87 150 267 429 643 892

Domestic stay 115 150 187 222 258 287

Number of Jobs Provided in tourism sector

85,629 121,588 176,687 238,337 314,797 398,581

Direct 28,976 41,143 59,788 80,649 106,522 134,873

Indirect 36,328 51,583 74,958 101,113 133,550 169,095

Induced 20,326 28,862 41,941 56,575 74,725 94,613

Growth of jobs in tourism sector (yoy%)

7.26% 7.76% 6.17% 5.72% 3.43%

Additional growth of jobs in tourism sector (yoy%)

0.99% 1.51% 1.75% 2.19% 1.15%

*) The sectors are defined based on the categories explained above.

From the numbers shown by the tables, we can conclude that the overall increase in direct spending on the tourism sector in Indonesia will enhance the growth rate of jobs, thereby resulting in higher employment figures.


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3. Development Scenarios This section sets out a vision for the BYP area and three possible development scenarios. Our evaluation of the scenarios will follow in Section 4.

3.1. Vision for Borobudur-Yogyakarta-Prambanan In order to achieve the targets as outlined above, determine the broad positioning of the area, guide our direction of travel and communicate our strategy to stakeholders we have prepared a Vision Statement for the Borobudur-Yogyakarta-Prambanan tourism destination. This vision should act as an inspiration for:

• Local, Provincial and National Stakeholders • Prospective International and Domestic Visitors • The International Travel Trade

The vision is about changing the perspective held of the region by civil society as a whole, including government officials, academia, local tourism providers, the international travel trade, and the media. The vision must incorporate a new approach to tourism based on a broader and more appealing offer rather than just the present BYP triangle. In this respect we believe that the whole island of Java has tremendous untapped potential as a tourism concept because of high recognition of its name in international markets and the very wide diversity of opportunities it offers within a single island, such that it could emerge as a strong companion destination to Bali. Our vision for the BYP ITMP area is:

‘Borobudur-Yogyakarta-Prambanan is the cultural and tourism

Heart of Java, with diversified attractions and strengths that create

a sustainable, resilient and world-class destination.’

This vision is the guiding principle for Borobudur-Yogyakarta-Prambanan to become a world-class

tourism destination, known both in international markets and within Indonesia for its rich and unique

culture and heritage including the iconic UNESCO World Heritage Sites of Borobudur and Prambanan,

the historic City of Yogyakarta, its beautiful scenery, and the friendliness of its people.

Focussing initially on BYP, the selected development strategy will initially reinforce the core areas and subsequently expand into the Joglosemar region and in the longer term to further areas of Java. The overarching objectives of this strategy are to:

• Rejuvenate and expand the product range and attract new markets

• Increase length of stay and visitor spend

• Equitably distribute the economic benefits of tourism

• Ensure a positive balance between the social and cultural costs and benefits of tourism


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The overall aim is to ensure that Java is on a par with the top destinations in Southeast Asia and celebrated as offering a diverse range of tourism attractions and experiences, including new flagship visitor attractions, clusters, and themed trails. As a destination, BYP and surrounding areas will set high standards in environmental and cultural resource management, achieved by public, private and community stakeholders working together to create a quality visitor experience. Within a context of flexibility and adaptability to ensure continuing market responsiveness, these efforts will create a sustainable and resilient tourism destination, as illustrated in Figure 3.1.

Figure 3.1 : The Sphere of Tourism Resilience

Source: ITMP Consultants

Based on this concept, the strategy for the area should be based on the following principles:

1. Sustainability, especially sound management of environmental, cultural and social resources

2. Maximising and spreading the economic benefits of tourism to all levels in society and levels of government

3. Diversification of the tourism product offer

4. Market understanding and responsiveness

5. Resilience, especially flexibility and adaptability to respond to changing market forces

6. Institutional strengthening

7. Rationalisation of institutions and legislation

8. The development of tourism clusters in all three BYP KTAs as an engine of growth for a wider area

9. Short-term improvement of BYP infrastructure and attractions

10. Medium-term expansion of tourism into Joglosemar

11. Long-term development of Java Tourism

12. Monitoring and Review


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3.2. Growth Options for BYP

In comparison to the Lombok and Lake Toba ITMPs being prepared in parallel to BYP, the Central Java/ DI Yogyakarta area presents a different range of constraints and opportunities for development. Unlike Lombok and Toba, both of which are predominantly in the Development or even Discovery phases of the Tourism Area Life Cycle, BYP is relatively mature and has an established market position. Furthermore, much of BYP – especially Yogyakarta and much of Prambanan - is essentially composed of urban or peri-urban areas and with fragmented land ownership, which constrains the opportunities for the development of large sites. Here, we are confronted with issues of urban development and redevelopment as opposed to ‘green field’ planning. Furthermore, the core issue for BYP is not how to attract tourists, as in many respects the destination is already very successful in that endeavour, especially as far as domestic visitors are concerned. The core questions identified in the baseline analysis are:

• How does BYP cope with growth beyond present visitor numbers?

• How does BYP derive greater economic benefit from the tourism sector?

• How does BYP attract a greater number of international visitors? In considering the path forward, we have taken account of the principal issues identified during the Baseline Analysis, summarised as follows:

1. Narrow tourism product offer 2. Over-reliance on cultural tourism 3. Over-tourism at Borobudur WHS 4. Weak appreciation of preserving heritage values and heritage economics 5. Over-reliance on domestic market 6. Poor international standard of attractions and interpretation 7. Poor access in terms of the volume of existing / forecast arrivals 8. Inadequate services infrastructure 9. Deteriorating environmental conditions, including air pollution and depletion of groundwater 10. Inability of local communities to take advantage of economic opportunities, partly through

skills and training gaps 11. Weak institutional frameworks and enforcement 12. Inadequate coordination and planning

Taking into account established tourism planning practice elsewhere and the socio-cultural and political realities of the BYP area, we have prepared in outline three principal Strategic Growth Options offering different approaches to tourism development in BYP and Joglosemar. These are:


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3.2.1. ‘Hub and Spoke’ Option

This option proposes a strategy of continuing along the present path of ad hoc, spontaneous

development based largely upon the existing tourism product offer, notably the ancient, unique but

threatened Borobudur WHS and the ‘street retail with cultural add-ons’ offer of the City of Yogyakarta,

with the Prambanan WHS as an additional attraction. Infrastructural improvements would take place,

and there would be some tourism-related investment interventions mainly located at or near the

current principal attractions. (Figure 3.2.) This option would mean that Yogyakarta remains the

dominant tourism destination in the BYP area with a limited number of sub-centres, especially YIA,

Borobudur KTA, Prambanan KTA, and the DIY Southern Beaches.

Figure 3.2 : ‘Hub and Spoke’ Option


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3.2.2. ‘Cluster and Disperse’ Option

Under this option the principal three destination areas would be managed to form a more balanced engine of tourism for a wider area, focusing primarily on DI Yogyakarta and the south-central part of Central Java. Infrastructural improvements would take place, and limited product diversification would foster clusters of subsidiary visitor attractions around the existing major ones, playing to the existing strengths of cultural resources. (Figure 3.3.) This option focuses on a balanced development of discrete tourism clusters within Kota Yogyakarta and at selected dispersed attraction sites, especially Borobudur TDA, Prambanan TDA, DIY Southern Beaches, YIA, BOB landholding, Wonosari/Gunung Sewu.

Figure 3.3: ‘Cluster and Disperse’ Option


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3.2.3. ‘Heart of Java’ (Multi-Centre Dispersion) Option

The third option proposes that BYP should form the core of a much wider ‘Java Tourism’ product,

developed over the 25-year plan period and offering a diverse spectrum of attractions and becoming

a strong companion to Bali as an international destination. This scenario would see infrastructural

improvements and the development of new flagship attractions as well as interventions designed to

build on and exploit a wide range of existing and potential skills and attractions in BYP, including MICE,

activity and nature-based tourism, beach resorts, performing arts and festivals, local-level cultural

assets including gastronomy, and history from Early Man to the birth of the Indonesian Republic.

(Figure 3.4.). This option would have a stronger focus on the wider area of Joglosemar, including

Solo/Sangiran, Merapi/Merbabu, Wonosari/Gunung Sewu, Ambarawa/Salatiga, Dieng Plateau,

Semarang, Karimunjawa in addition to Borobudur, Prambanan, DIY beaches, YIA Aeropolis.

The overall aim is to build a ‘Heart of Java’ destination as a core for expansion across Java.

Figure 3.4 : ‘Heart of Java’ Option


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Some of the concepts for new visitor attractions and facilities under the ‘Heart of Java’ option are

set-out below:

Kotagede Traditional Market Area Improvements

The key improvements to Pasar Legi Kotagede can be summarised as follows:

• Existing façade – Full preservation of existing façade to reinforce market identity.

• Babon Anim – Revitalise Babon Anim (formerly an electrical substation, built in in the early 1900s) by transforming it into a tourism information centre.

• Monumen Ngejaman – Renovate the Ngejaman Monument and introduce interpretative signage regarding its significance and history.

• Monumen Pacak Suji – Renovate the Pacak Suji Monument to become a welcoming statue for visitors to Kotagede.

• Traditional Crafts – The market should incorporate at least three to four crafts which are traditional to DI Yogyakarta, especially batik and lurik textiles,

Documents

2019 INTEGRATED TOURISM MASTER PLAN FOR BOROBUDUR ...p3tb.pu.go.id/uploads_file/20191231041524.Growth Projections and... · Figure 6.4: RTRW Kapubaten Magelang .....55. BYP ITMP -