As Bali Losses Hit $1 Billion, President Visits to Calm Tourists

(Bloomberg) -- As losses from an erupting volcano in Bali nears $1 billion, Indonesian President Joko Widodo and his deputy will visit the island to show the world that it's a safe destination for Christmas and new year holidaymakers.

Widodo, also known as Jokowi, will visit Bali on Friday and Vice President Muhammad Jusuf Kalla will celebrate the new year in the island, named the world's top travel destination by TripAdvisor Inc. this year. Indonesia's Tourism Ministry says tourists are safe outside an exclusion zone comprising a radius of about 10 kilometers around eastern Bali's Mount Agung, which has been spewing ash and smoke since Nov. 21.

Jokowi's administration is desperate to lure tourists back to Bali, also known as the island of gods, as tourism accounts for about 70 percent of the province's income. Losses mounted to 11 trillion rupiah ($812 million) since a volcanic alert was first issued on Sept. 21, according to the nation's disaster mitigation agency. Chinese visitors, the largest bloc of tourists to Indonesia, are skipping Bali following a travel warning by Beijing, The Jakarta Post reported, citing Indonesia's Tourism Minister Arief Yahya.

Read more: QuickTake Q&A on the volcano's impact on Bali's tourism

Hotel room occupancy in Bali is down to 20 percent, the Post reported, citing the Indonesian Hotel and Restaurant Association. Almost a million people had been expected to visit Bali in December and January combined, according to Anak Agung Gede Yuniartha Putra, the chief of Bali's tourism office. Now, expectations are for not less than half that projection.

--With assistance from Yudith Ho and Kyunghee Park

To contact the reporter on this story: Thomas Kutty Abraham in Jakarta at tabraham4@bloomberg.net.

To contact the editors responsible for this story: Linus Chua at lchua@bloomberg.net, Sebastian Tong, Stephanie Phang

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