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Local hotel demand soars ahead of Independence Day in Nusantara

Industry association PHRI says hotels in East Kalimantan have reached full capacity following a surge in booking demand ahead of the planned Independence Day celebrations in Nusantara, but has also assured that the resulting rate increases would normalize afterward.

Aditya Hadi

Aditya Hadi

The Jakarta Post

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Coordinating Political, Legal and Security Affairs Minister Hadi Tjahjanto introduces the new presidential palace, the Garuda Palace, on Aug. 7, 2024, during a press event in Nusantara, East Kalimantan. The newly built city will host this year’s 79th Independence Day celebrations, which are slated to include its inauguration as the nation’s capital. PHOTO: ANTARA/THE JAKARTA POST

August 14, 2024

JAKARTA – Hotels in the East Kalimantan cities of Samarinda and Balikpapan have seen a surge in demand to full capacity ahead of the 79th Independence Day celebrations in Nusantara, according to the Indonesian Hotels and Restaurants Association (PHRI).

PHRI also said the spike in demand had led to an increase in room rates, but it assured that prices would normalize following the Aug. 17 festivities.

“I think the price surge could be between 10 and 20 percent, as many people are flocking to the area in a short time. It’s a basic law of supply and demand: When demand is high and supply is limited, the prices go up,” PHRI chairman Hariyadi Sukamdani said on Monday, as quoted by news portal Kumparan.com.

State news agency Antara has reported that hotels in East Kalimantan had seen their occupancy rates rise to 90 percent due to the upcoming celebrations.

Hariyadi said the surge in booking demand had prompted some participants of the ceremony to rent residences that had been temporarily converted into guesthouses over the Independence Day holiday.

“We lacked hotel rooms, so this led to local residents coming up with the initiative to rent out their homes,” he added.

President Joko “Jokowi” Widodo and president-elect Prabowo Subianto are scheduled to celebrate Independence Day in the country’s future capital. Vice President Ma’ruf Amin and vice president-elect Gibran Rakabuming Raka, Jokowi’s eldest son, are to attend another ceremony held on the same day at the State Palace in Jakarta.

Read also: Govt under fire over extravagant Independence Day bill

The President said on Monday that because Nusantara was still significantly short of accommodations and dining venues, he had decided to reduce the number of invited guests from 8,000 to just 1,300. He added that the reduced figure excluded local participants who did not require accommodation.

Critics have lambasted the government for what they deem as excessive spending on this year’s Independence Day festivities in Jakarta and Nusantara, which the President has called “justifiable”.

Read also: Government ramps up preparation for first Independence Day in Nusantara

Jokowi emphasized that the government had carefully assessed logistical needs to prevent any mishaps during the celebrations, taking into account where guests would stay, how to supply meals as well as how to arrange transportation to and from Nusantara.

He also expressed optimism that the ongoing development of private hotels in Nusantara would alleviate accommodation issues in the future.

The President was in Nusantara on Monday to attend the groundbreaking ceremonies for the 197-room Swiss-Belhotel Nusantara and the Nusantara International Convention Center and Hotel.

The latter is being developed under a collaboration between the city authority and Royal Golden Eagle of paper and pulp tycoon Sukanto Tanot. Both projects are expected to be completed in the next 15 to 24 months.

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