Keywords

1 Introduction

Tourism industry has played an important role in the Indonesian economy. It contributed about 4.13% to 5.25% to national GDP, attracted more than 10 million international tourists and 250 million domestic visitors per year, and employed between 10.36 and 12.9 million workers each year during the period of 2015–2019 (see Table 8.1). The Indonesian tourism sector has also grown significantly and become one of the national leading industries in terms of its contribution to foreign exchange, second to palm oil industry.

Table 8.1 The key performance indicators of the Indonesian tourism sector, 2015–2019
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A recent report on biannual Bloom Consulting Country Brand Ranking for Trade and Tourism placed Indonesia among the Top 10 in Asia and number 31 in the world rank for country branding based on four criteria: economic performance, digital demand, country brand strategy (CBS rating), and online performance (Bloom Consulting, 2020). Indonesia’s TTCI (Travel & Tourism Competitiveness Index) score has improved in the last decade: 3.80 (in 2009), 4.00 (2011), 4.03 (2013), 4.04 (2015), 4.16 (2017), and 4.30 (2019) (World Economic Forum, 2019). Its TTCI rank has also consistently increased from 81 in 2009 to 40 (out of 140 economies being analysed) in 2019. The rank was higher than Vietnam (ranked 63), Brunei Darussalam (ranked 72), and the Philippines (75), but lower than Singapore (17), Malaysia (29) and Thailand (31). The overall TTCI score of the Indonesian tourism sector in 2019 was 4.30 (on a scale of 1–7, where 1 being the worst and 7 being the best), with top 10 performance in two aspects, i.e. price competitiveness and prioritization of travel and tourism. However, several aspects still need significant improvement, such as tourist services infrastructure, ground & port infrastructure, air transport infrastructure, environmental sustainability, health & hygiene, and safety & security.

As the Indonesian tourism sector grows in its importance and contribution to the national economy, the awareness and commitment to implement the principles of sustainable tourism development have also increased. The concept of sustainability has been incorporated in the Law Number 10 of 2009 on Tourism and several other relevant laws, such as Law Number 5 of 1990 on Conservation of Living Natural Resources and Their Ecosystem, Law Number 24 of 1992 on Spatial Planning, Law Number 5 of 1994 on Ratification of the United Nations Convention on Biodiversity, Law Number 41 of 1999 on Forestry, Law Number 25 of 2000 on National Development, Law Number 27 of 2007 on the Management of Coastal Zones and Small Islands, Law Number 32 of 2009 on Living Environment Protection and Management, and Law Number 11 of 2010 on Cultural Heritage Protection (Nurjaya, 2018).

In the Article 4 of the Law Number 10 of 2009 on Tourism, for instance, it is stipulated that tourism activities shall be intended to increase the economic growth, improve the people’s welfare, eradicate poverty, overcome unemployment, preserve the nature, environment, and resource, promote the culture, raise the nation’s image, foster a sense of patriotism, strengthen the national identity and unity, and strengthen international relationships. Furthermore, the Indonesian government issued Regulation of the Minister of Tourism of the Republic of Indonesia Number 14 of 2016 on guidelines for sustainable tourism destination. This regulation defines sustainable tourism as “tourism activities that take into account their current and future impacts on the economy, society and environment; meet the needs of tourists, industry, environment, and local community ; and can be applied into all forms of tourism activities in all types of tourism destinations”. In short, it is clear that the Indonesian government policies on tourism aim to create a balance of people, profit and planet (triple bottom line) or the ‘Three Es’ (environment, equity and economic dimensions) (Savitz & Weber, 2006).

However, since the first case of COVID-19 in Indonesia was confirmed on 2 March 2020, the Indonesian tourism ecosystem has been severely disrupted and fallen into crisis. Regional lockdowns, stay-at-home orders, mobility and travel bans, physical distancing, and quarantine policy have negative impacts on global, national, and regional tourism and hospitality industry. The accommodation sector is estimated to drop by 44.23% in the second quarter of 2020 compared to the same quarter of previous year and restaurant business is reported to decline by 16.81% during the same period (BPS, 2020b). The number of international tourist arrivals declined significantly from 1.39 million in September 2019 to 153,500 in September 2020, while hotel occupation rates dropped from 53.90% (April 2019) to 12.67% (April 2020) (BPS, 2020a).

This chapter aims to examine the emergence, development, and challenges of sustainable tourism in Indonesia. It begins with a brief reflection of what had been achieved up to a pre-COVID 19 period, followed by a description of how the pandemic has adversely influenced the industry. Finally, it proposes several important potential directions and challenges for the future of tourism sustainability in the ‘new normal’ Indonesia.

2 Methodology

The current research employed a qualitative approach to systematically and comprehensively examine the emergence, development, and challenges of sustainable tourism in Indonesia, the fourth most populous country in the world. Data were collected using a combination of archival document analysis and in-depth interviews. Available and accessible published materials (such as online newspaper articles, government websites, academic journal articles, and tourism-related reports) were used in the present study. The archival documents include publications in English and Bahasa Indonesia.

Interviews were conducted via Zoom with 13 representatives of 12 organisations that have been operating for at least 5 years. The average duration of the interviews was between 30 and 60 min. The interviewees consist of business owners, top-level managers and the head of the tourism management community. The organisations include three travel agents (Company A, Company B, and Company C), four hotels (Company D, Company E, Company F, and Company G), one villa management company (Company H), two restaurants (Company I and Company J), one tourism destination management (Company K), and one souvenir shop (Company L). The main objective of the interviews is to investigate how business players in the Bali tourism industry respond and adapt through the COVID-19 crisis. Specifically, the interviews focused on three issues: (1) the impact of COVID-19 pandemic on their businesses; (2) how they respond to the impact; and (3) strategy implemented in dealing with the ‘new normal’ situation. Both archival data and interview transcripts were content analysed to identify relevant themes or topics.

3 Reflection

Sustainable tourism refers to tourism development principles and practices with the purpose of making places better for people to live and visit. It aims to minimise the negative impacts and maximise the positive social, economic, and natural environment of tourism in destination communities (Saarinen, 2014). The concept and practice of sustainable tourism have been documented in Law Number 9 of 1990 covering the principles and objectives of Indonesia Tourism Development (Lemy et al., 2020). It is addressed in international scientific meetings and taught in tourism management courses and programs. However, a supportive national policy remained unclear until 2016 when the Regulation of the Ministry of Tourism Number 14 was announced (Lemy et al., 2020). The regulation consists of guidelines to build sustainable tourism destinations.

Only in recent years, Indonesian government recognise tourism as its leading primary sector. Indonesia has large and rich tourism resources in terms of natural environment and cultural resources of over one hundred ethnics (Nurjaya, 2018). There has been a major push in the government to support tourism development (Lemy et al., 2020). Tourism industry is a key component of the national development in the country. The main purpose of the push to develop tourism in the country is to improve the national economy, to create business and job opportunities, to encourage regional development, and to empower tourism destinations and attractiveness (Nurjaya, 2018). However, the country’s tourism development has been considered unbalanced and varied due to the lack of clear strategies (Lemy et al., 2020). One of the issues that the country faces is brought by the objective of increasing visitor numbers in the strategy (Indonesia-Investments, 2015). The government has made effort to promote destinations through a range of branding and marketing activities, for example, creating 10 new Bali destinations (Lemy et al., 2020). The goal is to ensure 20 million foreign tourists by 2019 (Indonesia-Investments, 2015). What has been criticised on these initiatives is on its lack of comprehensive tourism planning. The sole focus on massive sales and rising visitor numbers could distress the less-prepared destinations. Facilities and resources may be ruined and damaged through exceeding their carrying capacity. The local residents may reject tourism when they do not receive benefits from the sector, which lead to visitor dissatisfaction.

In 2016, the Ministry of Tourism published guidelines for sustainable tourism destination aligning with the three-pillar conception of (social, environmental and economic) sustainability. One of the highlighted areas is the value of national culture which is considered one of the tourism attractions. This is the main aspect in social sustainability for the sector to focus on in order to strengthen the national identity, pride and unity. Environmental element is specified in protecting biodiversity and natural resources in an integrated system of management protection which must be based on providing benefits for the economic and social development. Economic aspect focuses on generating economic benefits to local communities.

The scope of sustainable tourism destination development includes management of sustainable tourism destination, providing economic benefits to local communities, preserving culture for the community and visitors, and conserve the environment. The management of sustainable tourism destination has been given attention and the sector is advised to have short-term, mid-term and long-term tourism strategies covering issues such as access development to destination, tourism amenity, economic growth, social issues, cultural heritage, safety and security. Multiple destination management organisations are to be established involving both private and public sections with sufficient funding and clear tasks. It is worth noting that marketing activities has been given more weight in terms of tourism seasonality management focusing on identifying tourism opportunities and developing proper marketing strategy. In addition, destination promotion is encouraged, including promotion of products as well as services. Monitoring and reporting system is advised to ensure visitor satisfaction (Ministry of Tourism, 2016).

In its effort to optimise economic benefits for local communities, businesses at tourism destination are required to provide employments and training opportunities, work safety, and fair remuneration for all. The stakeholders from public and private sectors and local communities are encouraged to participate in the planning and decision making on the sustainable development of tourist destination. The Sapta Pesona Program is developed to be applied regularly to local communities. This program intends to raise tourism awareness, educate the communities to improve their understanding of opportunities and challenges in the tourism development of the destinations, as well as to highlight the importance in maintaining sustainability (Ministry of Tourism, 2016). In addition, legislations and programs have been established to prevent exploitation, such as commercial and sexual exploitation and harassment, other form of violation to children, teenager, women, and minority groups.

To optimise cultural preservation, policies and systems are developed to assess the effort in preserving cultural heritage, such as historical buildings and archaeological sites (Aznar & Hoefnagels, 2020). Indonesia has very diverse ethnic and racial cultures, and guidelines are designed to minimise potential impact from visitors on sensitive tourism locations. In the similar vein, the information in such destinations are adjusted in accordance to the local custom and developed in consultation with the community (Ministry of Tourism, 2016). Environmental conservation has also been given attention such as establishing systems to assess environmental risks in the process of tourism development as well as to prevent and address damages to the environment. In the sector, much effort is put into protecting ecosystem, species and habitat conservation areas, and preventing from invasive species. Other schemes and systems focus on protection of wildlife, energy conservation, better water management system, waste reduction, as well as promoting low-impact transportation (Ministry of Tourism, 2016).

Based on the principles of sustainable tourism, the government has established a number of systems and attempted to address sustainable issues in tourism development in the country. Many initiatives are made to ensure the welfare of all stakeholders involved in the destination development at the strategic level or at the early stage of the process. However, sustainable tourism development requires resources and can be space and land-intensive. There are challenges and/or obstacles in implementing these principles and guidelines for sustainable tourism. For example, there are frequently conflicts emerging between local community and tourism entrepreneurs in regard to the land use and occupation and other access to natural resources of the local community (Nurjaya, 2018). Economic benefits were mostly gained by those who have capital to invest, as a result, equitable benefit of tourism is difficult to achieve as the case in Toraja, Indonesia (Junaid, 2015).

Furthermore, as the world’s largest business sector and the most international in nature (Kotler et al., 2017), tourism is highly vulnerable to political, economic, socio-economic, security, and health risks. Despite the nation has shown resilience in bouncing back from several crises and outbreaks in the past (e.g., earthquakes, volcanic eruptions, terrorism, SARS, Ebola, influenza) (Novelli, et al., 2018), the unprecedented nature and effects of COVID-19 can have different yet significant long-term impacts on tourism industry (Sigala, 2020).

During the first 8 months of 2020, the number of international tourist arrivals was 700 million fewer than the same period in 2019, representing a loss of US$ 730 billion in export revenues from tourism, which is more than 8 times the loss due to the global economic crisis in 2009 (UNWTO, 2020). It was estimated that the international arrivals will drop by 70% globally in 2020, where Asia and the Pacific region recorded a 79% decrease in January–August 2020, while Africa and the Middle East both saw a 69% decline, Europe experienced a 68% decrease in arrivals and the Americas 65% (UNWTO, 2020).

The Indonesian tourism industry has been severely impacted by the COVID-19 pandemic. Both the total number of international tourist arrivals and the arrivals from each specific foreign country dropped dramatically (see Table 8.2). For instance, there were only about 3.5 million arrivals during January–September 2020, a 70.57% drop compared to the same period (12 million arrivals) in 2019 (BPS, 2020a). In September 2020, Indonesia recorded only 153,500 international arrivals. Half of them were from Timor Leste (76,800 arrivals—a 21.36% decline compared to September 2019), while about 35.3% (54,200 arrivals—a 76.35% decline) was from Malaysia (BPS, 2020a).

Table 8.2 The number of international tourist arrivals in Indonesia, 2015–2020
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Hotels saw a dramatic decline in occupancy rates since the COVID-19 outbreak reached Indonesia. The occupancy rates of star-rated hotels were around 51.91–60.19% in 2018 and 43.53%–59.39% in 2019, but the figures dropped to as low as 12.67% in April 2020 (see Fig. 8.1). This was caused by the decline of both international and domestic travels, international border closures, physical/social distancing policy, regional lockdowns in several cities in Indonesia, and stay-at-home campaigns in response to the high level of COVID-19 community transmission cases in the country (516,753 total cases and 16,352 total deaths per 27 November 2020) (Worldometers, 2020).

Fig. 8.1
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Hotel occupancy rates, 2018–2020

Note: The 2020 data only covers January–September

Source: BPS (2020a)

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The Indonesian Central Bureau of Statistics estimates that about 29.12 million people have been affected by COVID-19, where they lost jobs, fail to secure a temporary job or had working hours shortened (BPS, 2020b). In the accommodation and restaurant sectors, for instance, the employment rates grew from 5.2% in first quarter of 2018 to 6.41% in the fourth quarter in 2019 (see Fig. 8.2). However, it has been a significant drop since early 2020 and plummeted soon after. Following the trends in the tourism industry in general, most hotels and restaurants faced declining sales, which in turn forced them to take efficiency initiatives, including voluntary, temporary and/or permanent redundancies.

Fig. 8.2
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Employment growth rate in the accommodation and restaurant sectors, 2018–2020

Note: The 2020 data only covers three quarters

Source: BPS (2020b)

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Bali, the most popular tourism destination in Indonesia, presents an insightful case of how COVID-19 pandemic has created the lowest point in its tourism history (Wibisono, 2020). Bali had experienced several tourism-related crises in the past, such as terrorism (Bali Bombings 2002 and 2005) and volcanic eruption (Mouth Agung in 2017). Despite some negative effects, such as 20%–60% decline in hotels’ occupancy rates, tourism activities still took place during these difficult times (Sugiari, 2020). However, during the current COVID-19 outbreak, all tourism-related sectors in Bali have closed (Wibisono, 2020). The first confirmed COVID-19 case in Bali, a province with 40% contribution to the Indonesian tourism income (Susanto, 2020), was announced on 10 March 2020. The Governor of Bali, Wayan Koster, decided to take an unprecedented action by closing all tourism destinations in the province since 20 March 2020 to mitigate community transmission (Divianta, 2020; see Fig. 8.3 for some illustrations of the conditions). The economic impact of the closure is significant, where tourism in the province was predicted to lose about Rp 9.7 trillion per month and almost 95% of the hotels were closed due to the airport closure (Sugiari, 2020). It shows that COVID-19 pandemic “is not only different but has profound and long-term structural and transformational changes to tourism as socio-economic activity and industry” (Sigala, 2020, p. 312).

Fig. 8.3
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Tourism destinations in Bali: before and during the COVID-19. (a) Uluwatu (Before COVID-19). Source: Personal Documentation. (b) Uluwatu (During the Pandemic, 26 January 2021). Source: Personal Documentation. (c) Kuta Beach (Before COVID-19). Source: Personal Documentation. (d) Kuta Beach (During the Pandemic, 24 December 2020). Source: Personal Documentation. (e) Bedugul National Park (Before COVID-19). Source: Personal Documentation. (f) Bedugul National Park (During the Pandemic, 2 Oct 2020). Source: Personal Documentation. (g) Sanur Beach (Before COVID-19). Source: Personal Documentation. (h) Sanur Beach (During the Pandemic, 24 December 2020). Source: Personal Documentation

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At the time of writing this chapter, COVID-19 pandemic is ongoing and is very difficult to predict when it will be over. Vaccines are still under development. Many countries still have borders closed. Health-related protocols (e.g., wearing face masks and/or face shields, providing hand sanitisers, using mobility tracking applications, maintaining physical distance, and others) are part of ‘new normal’ in many countries, including Indonesia. Now every stakeholder in tourism industry focuses on survival issues or figures out how to bounce back. In fact, survival is a basic goal for an institution or organisation and a prerequisite for success in other key performance indicators, such as profitability and market share (Cottrell & Nault, 2004; Suarez & Utterback, 1995). In short, it requires an integrated effort of survival strategies and sustainability concept for all relevant stakeholders in the Indonesian tourism sector.

4 Reformulation

An important question to ask regarding sustainable tourism during the pandemic is: is the COVID-19 a setback for the implementation of sustainable tourism policy or a transformative opportunity to recover, reimagine and reform the next normal and economic order (Mair, 2020; McKinsey, 2020; Sigala, 2020) under the sustainable tourism framework? This question is not only relevant to the Indonesian tourism industry, but also to tourism sectors in all other countries. Some reports during coronavirus lockdowns show the positive impacts on the environment, such as clearer Venice canals (McLaughlin, 2020), declines in carbon emission and improved air quality in China, the UK and the U.S (Monks, 2020), and liberated wildlife in Wales, Japan, Spain, Chile, Canada, and the UK (Child, 2020). Sigala (2020) argues that it is the moment to break through and reset the tourism practice by converting the COVID-19 crisis disruption into transformative innovation. She recommended crisis management should focus on three major stakeholders (tourism demand, tourism operators, destinations and policy makers) under three stages (respond, recovery, and restart).

In their strategic plan for 2020–2024, the Ministry of Tourism and Creative Economy (2020) identified several specific challenges in developing sustainable tourism, including climate change and natural disasters (Indonesia locates at ‘the ring of fire’ where there is a high risk of earthquakes, tsunamis, flood, forest fires, draught, and volcanic eruptions), weak connectivity and infrastructure at tourism destinations; lack of empowerment of local community, investment-related issues (e.g., bureaucracy and perceived difficulties in doing business in the country), weak integrated branding and marketing strategies; lack of synergies between relevant stakeholders in the tourism industry, and lack of commitment to social, natural, and cultural environments among tourism business players. These challenges are even more difficult to address during the COVID-19 pandemic as UNWTO (2020) predicts that the decreasing growth of tourism industry will continue for the next five to 7 years. However, the Ministry of Tourism and Creative Economy (2020) also acknowledges that the pandemic provides two opportunities for transformation and recovery: (1) changing the business model from traditional tourism management into digital tourism management; and (2) shifting the target market from international tourists to domestic travellers.

Similarly, McKinsey & Company (Lath et al., 2020) suggests that the Indonesian tourism industry could be rebuilt by expanding domestic tourism (e.g., promoting its lesser-known destinations to locals) and developing niche and nature-based tourism to respond to changing traveller’s behaviours. Some pre-COVID tourism issues, such as waste (especially plastic trash) in many tourism destinations (e.g., Bali, Bunaken, Pulau Sempu, Ranu Kumbolo, and Gunung Gede Pangrango) (WowKeren, 2018), need to be handled effectively. For instance, it is important to accelerate initiatives for cleaning up the waste and increasing recycling, so both domestic and foreign tourists will have a better experience once it is safe to travel (Lath et al., 2020).

Indonesia is prone to natural disasters (e.g., volcanic eruptions, earthquakes, floods and tsunamis) and man-made disasters (e.g., forest fires) (Indonesia-Investments, 2018). Some notable disasters in Indonesia during the past 20 years include volcanic eruptions (Mount Merapi in 2010, Mount Agung in 2017), earthquakes (Lombok in 2018, Sumatra in 2004), tsunami (Aceh in 2004), and forest fires (Sumatra and Kalimantan in 2015). Despite its experience in managing and recovering from such crises (e.g., Gurtner, 2016; Liu-Lastres et al., 2020; Syamsidik et al., 2021), the country has been struggling in navigating the unprecedented detrimental effects of coronavirus outbreak (Aljazeera, 2020; Jaffrey, 2020; The Jakarta Post, 2020), such as unemployment, recession, and malnutrition. The global pandemic has caused severe global humanitarian problems, which was described by the United Nations as “the bleakest and darkest” time in the UN’s history (Aljazeera, 2020). Many industries faced the risk of survival, which beg for support and compassion from the government or other members of society (Kadirov et al., 2020). Tourism industry, for instance, is severely affected by mobility restrictions and bans, lockdowns, self- and mandatory quarantines, and social distancing policy (Sigala, 2020; Ugur & Akbiyik, 2020), because travel is requisite for tourism activity (Yeh, 2020). With its reliance on tourism sector (about 60% of its Gross Domestic Product before the COVID-19 pandemic), the economy of Bali province has been the hardest hit in Indonesia by the outbreak (Aljazeera, 2020).

Furthermore, Butler (1999, p. 11) argued that a proper definition of sustainable tourism is “tourism which is in a form which can maintain its viability in an area for an indefinite period of time”. This definition suggests the importance of long-term survival (longevity) of a tourism destination, its ecosystems and its relevant stakeholders. In order to provide insights from business players in the Indonesian tourism industry, we conducted in-depth interviews with representatives (business owners, top-level managers, and head of local tourism management) of three travel agents, four hotels, one villa management company, two restaurants, one tourism destination management, and one souvenir shop in Bali. In terms of the impact of the COVID-19 outbreak on their businesses, all interviewees consistently reported that their organisations have faced difficult times during the pandemic. However, their specific responses to the impact varies between companies.

The three travel agents (Company A, Company B, and Company C) experienced a dramatic decrease in sales (down to zero sales) due to regional lockdown and the closure of international airports. The initial effort made by Company A was laying off some employees, imposing unpaid leave, implementing working from home policy, and reducing numbers of working days. The same strategy was adopted by Company B and Company C, but they did not reduce the number of employees. The difficult situation has forced the travel agents to make new breakthroughs to maintain their businesses. Among the initiatives are virtual tours, 50% discount rates, and special vouchers (‘pay now, stay later’). They welcome the relaxation of restrictions under the ‘new normal’ policy set by the national and local government by implementing new health protocols (e.g., providing hand sanitizers and face masks) and shifting their focus at least temporarily from international markets to domestic markets.

The four hotels (Company D, Company E, Company F, and Company G) and the villa management company (Company H) faced a decrease in hotel occupancy rates by about 80% because many tourists decided to leave Bali and return to their home countries earlier during the regional lockdown. In response to this difficult situation, hotel managers had to implement redundancy policy, unpaid leave, working from home, and reduced working days. During the ‘new normal’ condition, where Bali was open to domestic travel only, both international and local hotel managers decided to shift their target market from foreign tourists to domestic ones. Health-based customer services were put in place to provide a sense of safety and comfort for hotel guests. Another income generating source initiated by hotels is offering hotel facilities, such as swimming pools and restaurants, to local people who want to enjoy these facilities without checking in as room guests.

Company I, whose main customers are domestic tourists who travelled in a large group, had to close its outlet and lay off their employees temporarily. Their remaining employees only worked for 15 days in a month. In contrast, Company J, which is a boutique restaurant with fewer employees compared to Company I, retained its all employees during the pandemic. These two restaurants came up with some breakthroughs to generate income. Company I, for instance, rents its open space for camping purposes, a unique offer for those who want to do outdoor activities in a safe environment. Company J opens some culinary courses to public and sells organic market (i.e. fresh vegetables).

Company K is one of the most popular tourism attractions in Bali. By using the concept of a tourist village, the manager (who is also the local community’s leader) empowers the surrounding community to work at the company. During this pandemic, the manager followed the provincial government’s instruction to close its services. As a result, almost no tourists visited the location during that time. The manager decided to reduce the number of working days for all employees to control its spending. However, no employees are dismissed, because they are members of the local community. In anticipating the new normal condition, they prepare new health protocols and design new attractions.

Company L is one of the biggest souvenir shops in Bali. Facing declining sales since mid-March 2020, the owner decided to close all outlets and offer temporary redundancy to its employees. Some initiatives were explored, such as using the owner’s agricultural land for planting snow peas to support his employees and developing online marketing channels to expand its markets. The snow peas now become one of the company’s new products. During the ‘new normal’ condition, the owner re-opens some outlets and provides COVID-19 health protocols (e.g., providing hand sanitizers, facilities for washing hands).

5 Survival and Recovery Strategies

The interview results revealed a pattern of survival and recovery strategies implemented by companies under study (see Table 8.3). These organisations have implemented a combination of the following strategies (4Rs: Restructuring, Realigning, Researching, and Retargeting). The first and most common strategy, restructuring, focuses on efficiency. Travel agents controlled their operational costs by reducing working hours, offering temporary and voluntary redundancies to their employees, discontinuing the contracts for casual workers, and offering unpaid leaves. While working from home (WFH) is adopted by all travel agents, it is impractical for restaurant business. Similar strategy but slightly different approach was employed by Company K, Company L, and Company H. Instead of laying off workers, Company K reduced and re-arranged tasks/activities. This initiative was chosen because all their employees are locals who need jobs. Company L re-arranged its working schedules by allowing its employees to work every other week. Company H changed its operational system from commercial into residential villas. Under the new system, the maintenance and service frequency provided to each villa had been reduced.

Table 8.3 Typology of survival and recovery strategies
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The second strategy, re-aligning the business process, reflects efforts and initiatives to comply with the new COVID-19 protocols set by the Indonesian government. Company C evaluated the readiness of its potential collaborators (e.g., restaurants and hotels) in meeting the new COVID-19 protocols. Company D limits meeting room capacity to only 50% and impose a digital invoice for staying guests. Company B chooses to only accept VIP guests, amounting to four people. The travel agents have begun to use digital marketing channels to attract tourists. Company L requires its guests to wash their hands and to have their body temperatures check. All Company L’s employees are equipped with masks, gloves and face shields. Company H formed a special taskforce to clean all areas using disinfectants regularly.

The third strategy is researching and responding to the new business opportunities. In order to explore potential business opportunities, companies have initiated several market research activities, such as talking to suppliers, distributors, customers, and tourism-related associations (e.g., Indonesian Hotel & Restaurant Association, Association of the Indonesian Tours & Travel Agencies), attending webinars, and monitoring news on mainstream media and social media. Based on the insights and inspiration from best practices of other companies around the globe, the travel agents (Company A, Company B, and Company C) and hotels (Company D, Company E, Company F, and Company G) decided to explore virtual tours, hotel ‘staycation’, self-quarantine facilities, and online food delivery services to help them maintain their cash flow. In addition, Company A has started to offer corporate outing events to several large local companies, while Company B focuses on activity-based tourism and experiences in rural life. Utilizing its large area to attract local tourists who want to experience the sensation of camping on the beach while maintaining physical distance, a unique ‘camping on the beach’ package has been offered by Company I.

The last strategy in the typology, retargeting the market, involves shifting the target market segment(s) from international to domestic market. Driven by the closure of international airports, travel agents have retargeted domestic travellers or local Balinese tourists. Hotels have also turned to domestic market, including honeymooners and millennial travellers. Honeymooners tend to have more certain travel dates than other segments of holidayers/travellers. Company G serves millennials who are believed to seek for adventures, love new experiences, and look for value-for-money offers. Company G also targets tourists who plan for a long-term vacation (staycation). Company A, a big travel agent used to focus on B2B model, has changed its emphasis to B2C model amid the COVID-19 pandemic.

Interestingly, the two recovery opportunities (i.e. digital tourism management and domestic market focus) identified by the Ministry of Tourism and Creative Economy (2020) have been pursued by tourism business players in Bali. What seems to be the case during the COVID-19 crisis is that the top priority for most stakeholders in the tourism industry is survival and recovery. It is interesting to see how such priority can be further integrated with the sustainable tourism development policy from the government.

6 Concluding Remarks

In their 25-year bibliometric analysis of sustainable tourism research , Ruhanen et al. (2015) noted that most of such study was conducted in the North-West Europe, Oceania, and North America. A specific research on Southeast Asian context, including Indonesia, has been relatively limited. The current study fills the gap by focusing on the emergence, development, and challenges of sustainable tourism thought and practices in Indonesia, the largest economy in the Southeast Asian region. The findings show that there has been a growing awareness and commitment to adopt sustainable tourism development principles in the country. The government has issued several relevant policies and regulations to support the creation of a balance of social, economic, and environmental aspects of tourism activities. However, there are still many challenges in coordinating and implementing the policies effectively. While the COVID-19 outbreak has severely impacted the tourism industry, there are opportunities to survive and recover. At the micro level, those who innovate will have a higher opportunity to succeed. At the macro level, continuous support from the government and public is required to help the industry to bounce back, which in turn may transform into a more sustainable one.

Furthermore, ensuring business continuance and building resilience is an important implication of COVID-19 (Sigala, 2020). The present study offers important insights into how tourism and hospitality businesses in Bali respond and adapt during the COVID-19 pandemic and new normal. The experiences within the five sectors of tourism (travel agent, hotel, restaurant, tourism destination, and souvenir shop) show that all companies have faced the same critical conditions and they engage in three stages for overcoming the effects of the COVID-19 pandemic: response, recovery, and reset (Sigala, 2020). Although the specific responses varied across companies reflecting specific contexts, adaptability and flexibility of each player, the patterns of survival and recovery strategies can be classified into the 4Rs strategies. Companies have navigated and survived the crisis by restructuring the business to improve their efficiency, re-aligning business processes in compliance to COVID-19 health protocols, research and responding to new business opportunities, and/or retargeting the market. Interestingly, the strategies show that during the COVID-19 pandemic, which has been perceived as a ‘death sentence’ for many businesses, companies in the Indonesian tourism and hospitality industry have explored many innovative breakthroughs beyond survival. Such insights are relevant for other companies in the same and different industries as well as in different countries (e.g., Southeast Asian region) facing the COVID-19 crisis. Therefore, the typology of 4Rs strategies reflects the theoretical contribution of the current study to the business survival and recovery strategy literature, particularly in the context of sustainable tourism.

There are several practical implications of the current study’s findings for the relevant industry stakeholders. First, the national and local governments need to involve and integrate community stakeholders and available resources in preparing, organising, implementing, and controlling a comprehensive tourism planning for post-COVID era. Partnerships with private sectors and non-government organisations (NGOs) are essential in providing continuous support and assistance for individuals and organisations affected by the COVID-19 crisis. Second, community engagement is crucial in making sustainable tourism a success. In times of crisis, community participatory approach based on good understanding of local culture and religion is essential for building resilience to recover (Liu-Lastres et al., 2020). The experience of Company K in the current research provides a good example of such local engagement. Third, tourism business players may consider adopting one or more of the 4R strategies in navigating the COVID-19 crisis. Technology and market orientation are two important factors for leaving the crisis stronger. Fourth, as tourists are adapting to the new normal, the government and tourism destination management may prepare more sustainable and responsible consumer practice guidelines once tourist traffic increases again. To summarize, it takes an integrated effort of all relevant stakeholders to develop tourism activities with “a suitable balance between the environmental, economic and socio-cultural aspects to guarantee its long-term sustainability ” (UNEP & UNWTO, 2005, p. 11).