Indonesia’s hotels suffer as Prabowo’s austerity drive hits travel and events

[JAKARTA] Indonesia’s hospitality sector is feeling the chill as sweeping budget cuts under President Prabowo Subianto’s administration begin to bite – stripping away a vital source of income for hotels long reliant on government events, official travel and corporate retreats.

Hotel occupancy rates in several regions have plunged to as low as 20 per cent, said the Indonesian Hotel and Restaurant Association (PHRI), sparking concerns of a broader slowdown just as the sector was finding its footing post-pandemic.

Government-related bookings make up 40 per cent of total hotel demand, noted the industry association, underscoring the sector’s heavy dependence on public spending.