CHAPTER 1: Introduction

Agrotourism as an Alternative Form of Tourism in Bali
(Case Studies: Bayung Gede, Candi Kuning, Blimbingsari, and Pelaga Villages)

Links to Journal Agrotourism

Summary, Chapter 1, Chapter 2, Chapter 3, Chapter 4, Chapter 5, Project Research, Authors

1. Introduction

1.1. Background

Before the 1998 economic crisis, Indonesia belonged to a new Asian Tiger simultaneously with Malaysia and Thailand and was a model to other developing countries for the achievements on rapid and sustainable economic growth and rapid structural change (Tambunan, 2006).

The Indonesian economy has undergone a massive structural transformation from an economy where the agriculture sector plays a dominant role in the country. Presently, approximately 45% of the total Indonesian workers are engaged on agriculture, which accounted for 17% of GDP in 2001. Some 31 million ha (76.6 million acres) are under cultivation, with 35% to 40% of the cultivated land devoted to the production of export crops. Some 60% of the country’s cultivated land is located in Java (Indonesian Agriculture Department, 2002).

The agriculture sector includes food crops, horticulture, plantation, forestry, fishery, and animal husbandry. Since of various factors such as housing development, industries development, etc, the contribution of agriculture sector to Gross Domestic Product (GDP) becomes much less important replaced by secondary and tertiary sectors such as manufacturing industry as a new leading sector, for instance, West Java was leaded by manufacture industries, Bali by tourism sector, and Jakarta by retailing industries.

As the population increases rapidly, the government seeks to achieve food self-sufficiency through expansion of arable acreage and improve the farming techniques especially the use of fertilizers and seeds, and extension of irrigation facilities, as well as expanding training for farmers. Production of rice and the staple food have increased gradually therefore rice production almost comes close to meet domestic requirements.

On the other hand, the tourism sector in Indonesia has expanded as a prospective contributor to earning of a number of local governments. Nowadays, the tourism sector is not only potential in Bali but also probable in all parts of Indonesia. The International Ecotourism Society states that Indonesia has been identified as a prospective country to develop tourism especially ecotourism. In addition, Indonesia has lots of wildlife flora and fauna as well as cultural diversities, black and white sand beaches, natural landscape, marines, mountains, etc. The tourism sector becomes a more prospective sector in Indonesia as illustrated in the growing number of international tourist arrivals shown in Chart 1.

Chart 1, The Growth of Foreign Tourists Visiting Indonesia period 1989 to 2005. Source: Statistic Agency of Indonesia, 2006

The chart 1 above illustrates that tourist arrivals grew inconsistently although tourism sector in Indonesia had grown a lot with mean value of approximately four millions visitors per year. The mean also indicated clearly that the tourism sector is prospective for the future.
The gradual increase tourist arrivals for the period of 1989 to 1997 were the growth stage of tourism in Indonesia. Since 1969, the government of Indonesia had been engaged into account of tourism development on national policy and planning called “Pelita I” the first step of five periods of development policy and planning. Unlikely, by the end of 1997, the economic crisis in Asia particularly Indonesia had broken down the tourism sectors and other sectors which then declined the number of arrivals in 1997 to 1999 which caused by internal and external factors. The internal factors were not only caused by economy crisis, but also by other factors such as politic, disaster, etcetera. The decline in 2001 to 2003 was caused by external factors such as terrorist attack destroyed World Trade Center (WTC) in United States of America and Bali bombing tragedy in Legian, Kuta-Bali.
Tourism has played an important role and essential source of earning. It can be evidently seen that almost all of economic activities in Bali were depended on and leaded by tourism sector. According to Pitana (2005), tourism sector is an incredible contributor to Product Domestic Regional Bruto (PDRB) for Bali. The tourism sector contributed 12.95% by 1970, 17.98% by 1990, 30.50% by 1997, 30.49% by 1998, 31.26% by 1999, and 33.19% by 2000. Examining further to the great contributions generated by tourism, therefore tourism sector in Bali is considered as an awaiting sector for now and upcoming year.
Furthermore, the prospective of tourism in Bali can be seen in Chart 2 that describes the number of international visitors and the growth of arrivals to Bali for periods 1969 to 2005.

Chart. 2, Number of direct international visitors to Bali for periods 1969 to 2005

Source: Bali Tourism Board, 2006

Chart 2 also indicates that the growth of international tourists visiting Bali since 1969 to 2005 fluctuated by mean of 559,356 visitors per year. The numbers of tourists’ fluctuations were caused by internal and external factors as well, such as terrorist attack occurred in September 2001 in World Trade Center.
At the same time, new competitors in South East Asia such as Malaysia, Thailand, Vietnam, and Philippines confronted Bali. Inauspiciously, global issues like terrorism as Indonesia is predominantly a Moslem country also affected the inconsistency of the tourist arrivals to Bali. The decline occurred in 1998 was caused by economic crisis. Meanwhile the sharp decrease in 2001 to 2003 caused by terrorism issues and by the end of 2005 by disaster issues.
Even though, the tourism sector was growing inconsistency but it’s still as important sector in Bali. The development of tourism sector should be continued sustainability because the infrastructures such as international and local hotels, restaurants, travel agencies and others local business were growing in Bali.

1.2 Tourism Development Stages

According to Butler (1980), quoted by Gilbert (1990), the stages of tourism development comprises four stages such as discovery, launch, stagnation, and decline stages where the stages of tourism development in Bali are illustrated in the Graph 1 below.

Graph 1 Bali Tourism life cycle. Source:

Discovery Stage
The early 1900s brought a different type of invasion and tourism began to rise. Bali’s exotic beauty and culture as well as Balinese people’s hospitality began to draw foreigners to the island. Some, including German painter named Walter Spies, whose home now formed as a part of Hotel Tjampuhan Ubud, decided to settle down there. Spies and other foreign artists helped to stimulate the growth of Balinese arts which were originally produced mainly to decorate temples and palaces (

Launch Stage
The second president of Indonesia, Soeharto, saw Bali as one of potential tourism destinations and reopened it to tourism in the late 1960s. One of the first big hotels built was Inna the Grand Bali Beach Sanur. The host communities respond and welcome it respectively to increase the number of tourist visits by providing facilities. Businesses remain family based and the visitor-resident relationship is still harmonious. Later in this stage, the numbers of tourists increased dramatically and the local communities involved in certain tourism industries.
The tourism was launched for both domestic and international tourists. For the purpose of supporting the tourism sector, the government, investors, private sectors, and small-local enterprises working together by providing infrastructures such as hotels, restaurants, travel agencies, tourism objects such as beaches, retailing, roads, airport etcetera. On the other hands, the superstructures such as supporting tourism organizations for instance BTDC (Bali Tourism Development Centre), BTB (Bali Tourism Board), PHRI (Indonesian Hotels and Restaurants Association), and Tourism and Hotel Colleges are established professionally.
Stagnation Stage
Nowadays, the growth of tourism Bali is indicated as stagnation stage, while tourism sector has been developed in such contemporary way nevertheless the growth of tourist visit is still stagnant even though a number of promotions are continuously and intensively conducted. Furthermore, there are lots gaps between sectors, for instance: degradation of natural resources, overland using to build hotels and tourism infrastructures, air and water pollution; gap between rural and urban area, etcetera.

Presently, modern tourism development in Bali continues to attract all kinds of tourists. Some of international industries such as international-chain hotels and resorts lie on alongside the island. Its people continue to struggle over the choice between modernization and tourism, and their rich tradition. Although it has suffered some adverse social and environmental effects as a result of rapid tourism developments, Bali’s cultural heritages have withstood the test of time and remained slight changes today.

The stagnation stage has been identified since 2001 up to present, where the number of international arrivals is stagnant of approximately one million visitors per year. The developments of Bali really depend on tourism sector even though dominantly the populations of Bali are still working in agriculture sector. The stagnation stage is caused by internal and external factors. Internal factors consist of urbanisation problem, un-ecological development, unequal spatial where tourism development was focused southern part of Bali for instance Sanur, Kuta, and Nusa Dua without design guidelines. Meanwhile the external factors contributed to stagnation are terrorism issues, Irak war II, SARS disaster in Asia, new tourism destinations, etcetera (Pujaastawa, et al, 2005).
Additionally, according to Butler (1980), quoted by Gilbert (1990), the stagnation stage should be seen as a signal to innovate and find out alternatives to avoid the declining stage and to refine the growth of tourism. The tourism sector in Bali shall be immediately innovated and continuously developed based on sustainable tourism development concept.
According to Pitana (2005), the vision and planning development of tourism in Bali shall be based on Balinese culture as it is the only island which dominated by Hindus worshipers in Indonesia. Furthermore, Bali has a number of man-made tourism attractions and natural attractions such as lakes, mountains, beaches, and agriculture areas which should be persistently managed.
The goal of tourism development in Bali is to realize the sustainability of cultural-based tourism which developed in accordance with Tri Hita Karana concept as well as both the global market competition and improving quality of life of local communities. Tri Hita Karana is the philosophy of Balinese-Hindu which comprises three main elements namely harmonious relationship among the human being, between human and environment, and human and the Almighty God (WTO, 2003).

One of the visions of tourism development in Bali is to develop rural tourism based on local indigenous. It means whereas the tourism shall be developed in accordance with sustainable development principles by equality of people, profit, and planet. Without sustainable development, tourism will fail definitely to achieve the authentic goal of its development. One of the failure factors of tourism development identified by Subadra (2006) is that tourism is un-ecologically developed. In the similar study by McIntosh, et al. (1984) quoted by Subadra (2006) describes that the development of tourism is not always successful even though developed in an ecotourism model. Yet it sometimes fails to achieve the authentic objective of development since it also causes many negative impacts such as; solid waste generation, habitant disturbance, and forest degradation which is caused by the path erosion. Therefore, tourism may not be overdeveloped and rural destinations should not be visited by many tourists at the same time. Moreover it sometimes fails to give economic benefits while the profit generated from tourism development is not directly accepted by the local communities. In many cases, local communities are frequently left out since they normally do not have adequate knowledge, skill, and attitude to involve in tourism.
Furthermore, United Nation (UNEP, 2003) mentions that development of tourism should be based on the guidelines of sustainable tourism principles and agrotourism was identified as a tourism development model which is based on environment, nature, and biodiversity. In a similar study conducted by Sudibya (2002) explains whereas the international tourists particularly the educated tourists prefer visiting the destinations which concern much on environment sustainability and nature conservation to destinations which serve modern developments.
Conversely, Pitana (2005) mentioned that the agriculture sector in 1970 contributed 55.99% for Product Domestic Bruto of Bali Province, 32.53% by 1990, 19.33% by 1997, 23.31% by 1998, 22.10% by 1999, and 20.61% by 2000. These data illustrate that the agriculture sector is the second important sector after the tourism sector. While the current situation, the tourism sector in Bali is capitalistically and unequally developed since the development dominated in Southern part of Bali Island only. There is a gap between Northern and Southern part of Bali especially development of tourism sector (Pujaastawa, 2006). The great potencies of agriculture resources in Western, Middle, Eastern, and Northern parts of Bali Island have not been well developed and collaborated with tourism sector.
In this study, the research is focussed on economic, social and environmental benefits of agrotourism for the local communities and the demand of agrotourism among the tourists. The study is aimed at formulating the best strategies to innovate and develop agrotourism in Bali.

1.3 Problem Statement and Research Questions:
1.3.1 Problem Statement
How could agrotourism contribute innovation to the tourism sector and improve the economic, social, and environmental situations of local communities in Bali?

1.3.2 Research Questions
The questions of this research are formulated as follows:
1. How is the current situation of agrotourism in Bali?
2. What opportunities are available to develop agrotourism in Bali?
3. What barriers are found in developing agrotourism in Bali?
4. What are the tourism stakeholders’ opinions toward agrotourism development in Bali?
5. How could agrotourism improve of the economy of local communities in Bali?
6. How could agrotourism improve the social situation of local communities in Bali?
7. How could agrotourism sustain the tourism development in Bali?

1.4 Research Aims
The research is aimed at exploring the potencies of agrotourism in contributing innovation on tourism sector and to improve the economic, social and environmental situations of the local communities in Bali. Furthermore, the purposes can be detailed as follows:
1. Obtaining information concerning the current situation of agrotourism in Bali from general perspectives.
2. Identifying the opportunities to develop agrotourism from Balinese farmers’ opinions.
3. Identifying the barriers in developing agrotourism from Balinese farmers’ opinions.
4. Understanding the tourism stakeholders’ opinions concerning the agrotourism development in Bali from many perspectives such as entrepreneurs, government, tourism industries, NGOs, universities, local communities, and tourists.
5. Identifying the contributions of agrotourism in improving the economy of local communities from stakeholders’ opinions.
6. Identifying the contributions of agrotourism in improving the social situation of local communities from stakeholders’ opinions.
7. Identifying the contributions of agrotourism in sustaining tourism development from stakeholders’ opinions.

1.5 Overview of the report
Chapter 1: Introduction
This chapter comprises introduction to agriculture and tourism situation in Indonesia and Bali as well as the background, problem statement and research questions, research aims, and overview of the report.

Chapter 2: Literature Review
This chapter describes the main and relevant theories as well as concepts on agriculture, tourism, and agrotourism; main claims; and main arguments.

Chapter 3: Methodology
In this chapter comprises conceptual framework, research design, sampling technique, type of data, and analysis technique will be used to analysis of the research finding. The case studies determined by purposive method comprise Bayung Gede, Candi Kuning, Blimbingsari, and Pelaga Villages, as representatives of agrotourism in Bali Island. This study uses qualitative research design in which the data collected through questioners distributed to the respondents using Likert-scale interval. The respondents are determined by using purposive sampling. The data are descriptively analysed using SWOT analysis.

Chapter 4: Finding and Analysis
The analysis and interpretation will be used to acquire information about the current situation of tourism and agriculture in Bali by case studies comprise Bayung Gede, Candi Kuning, Blimbingsari, and Pelaga Villages, as representatives of agrotourism in Bali Island. The opportunities and barriers of developing agrotourism from Balinese farmers’ opinions will be descriptively and clearly described this chapter. The tourism stakeholders’ opinions toward the agrotourism development in Bali exactly from entrepreneurs, government, tourism industries, NGOs, universities, local communities, and tourists will also be discussed. The contribution of agrotourism in improving the economy and social situations of the local communities as well as sustainable tourism development will be collected and described as a part of this chapter.

Chapter 5: Conclusions
This chapter will conclude the finding of the study by using SWOT analysis and identify which factors belong to the strengths, weaknesses, opportunities, and threats factors.

Chapter 6: Recommendations
The recommendation of this study is formulated from the result of SWOT analysis. This chapter deals with the strategy of agrotourism development in each place as described in Chapter 3.

The lists of bibliographies comprise books, journals, url/internets, and others publications are quoted in this part.

This part will be used to determine the findings of research that do not include in the discussion chapters for instance list of respondents, pictures, etcetera.

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