Investment in Lombok Business Guide: Bali VS Lombok

Investment in Lombok, Bali, and other Indonesian islands is not new to foreign investors. A reason for its popularity is its growth potential and how fast its tourism sector recovers from adversity.

Not so long ago, Bali’s tourism industry received a heavy blow when the volcano – Mount Agung started showing signs of eruption in November 2017. Inbound traffic took a dip, but the island quickly bounced back, with 14,000 visitors every day – showing an astonishing recovery of over 90% in less than three months. In 1998, when Indonesia suffered a severe financial crisis, the impact on Bali was minimal (when compared to other regions). The devaluated Indonesian Rupiah acted as a catalyst in maintaining the tourism industry

Bali has shown an impressive return of numbers regarding international tourist visits after the pandemic

The graph showcases that despite the tourism sector taking a hit from the pandemic, the prospects for foreign investments in Indonesia still look very promising, especially in the tourism industry.

Read more about foreign investment: How to Buy Property in Lombok – The Most Secure Way

Steps to recover Indonesia’s Tourism sector from the pandemic

The Indonesian tourism industry plans to return from the tourist drought by accelerating vaccine drives. In addition, the government is also in talks with Singapore, China, South Korea, India, the Netherlands, the United Arab Emirates, Ukraine, and Poland about potential travel bubbles that will allow their nationals to visit sites that have curbed COVID-19 infections. Such measures signify that the government is considering limiting foreign travel to uplift the ailing tourism industry. 

Indonesia is focused on increasing the number of foreign arrivals to support economic growth policies, but the country cannot solely rely on Bali. 

Hence, the Government has introduced 10 other top-priority destinations (known as 10 New Bali) to replicate the economic effects of tourism in Bali nationally. One of such destination is Mandalika on the Island of Lombok which lies a stone thrown away from Bali

Indonesia SEZ: Mandalika Projects – The Next Bali

In 2017, President Joko Widodo declared Mandalika as a priority destination, pushing the government towards accelerating the development process in Lombok to provide more tourist destination options. The US$3 Billion Mandalika Development Project in Lombok aims to have more than 16,000 hotel rooms, a waterpark, a 27-hole golf course, 1,500 villas, and a 4.3km International Race Circuit.

The Integrated Tourist Master Plan (RIPT)-Lombok Island, presently in its drafting stage, is a detailed plan drafted to develop a resilient, inclusive, and sustainable tourism ecosystem in Lombok. The government plans to improve connectivity from ports and airports to facilitate tourism and also aims to preserve and promote the cultural diversity of Lombok.

SEZ Incentives (Special Economic Zone) in Mandalika

With a bunch of incentives on offer due to its inclusion in the Special Economic Zone (SEZ) list, Mandalika poses a lucrative investment opportunity for international investors.

12 Million tourists is projected to arrive in 2045 as compared to 2.4 Million in 2018, Lombok Island is expected to become a world-class tourism destination. Here are some key difference, investors should put in mind when considering starting a business in Bali or Mandalika: 

Read more: Due Diligence to Conduct before Buying Land in Bali & Lombok

Ensure Your Investment In Lombok Complies With The Indonesia Company Act

Setting up a business overseas comes with its fair share of challenges. Foreign investors might face difficulties while registering their business in Indonesia as they might not be very well versed with various business nuances of the Indonesian Companies Act. 

While you focus on the core business aspect of your investment in Lombok, InCorp’s comprehensive business solutions can help you in the technical facets of starting a business setup in Lombok.

To help your company comply with investment in Lombok, InCorp provides a full selection of services as an accounting agency. On the legal side, our consultants provide legal guidance helping companies to comply with applicable laws and regulations in the country.

To know more about how InCorp’s solutions can help you invest in Indonesia, please fill out the form below or talk to an expert on our chatbot.