Kompas.com reports that the Bali Tourism Promotion Board (BPPD) and the Provincial Government are growing increasingly concerned with what is viewed as unhealthy price competition in the badly over-built tourist accommodation market, as quoted from Bali Discovery.
In a market in which three-starred hotels are charging rates less than Rp. 300,000 per night, the BPPD and the Provincial Administration are concerned that the elegance and quality of the Bali travel product are under threat.
The head of BPPD and chief of the Indonesian Hotel and Restaurant Association (PHRI-Bali), Tjokorda Oka Artha Ardhana Sukawati (Coka Ace), said on Monday, June 5, 2107, he has been concerned about the continuing hotel price war and its impact on the economy over the past three years.
Because of this, Cok Ace has urged the Provincial Government of Bali to mediate the price war through standardization of pricing policies. In the past, he explained, efforts at standardization have been limited to granting star ratings based on the number of rooms and the overall quality of the hotel. To date, however, there have been no moves to standardize hotel pricing, leaving hotels free to pursue higher occupancies, frequently at the consequence of lower prices.
Meanwhile, Bali Governor Made Mangku Pastika has issued a press announcement urging the creation of a legal basis for controlling the pricing policies of hotels in Bali, stipulating the minimum price that hotels of a specific star rating are allowed to sell their rooms.
The Governor has invited the industry and the academic community to undertake a careful study to determine the most effective way to control pricing and sanctions to be applied when hotels are found to be ignoring government pricing policies.
Statistics from the Central Statistic Bureau (BPS) in Bali calculates 281 starred hotels in Bali, 89 of which have 3-star ratings.