Tourism and Construction in Bali Slow Down the Impact of the Middle East Crisis

DENPASAR - The Bali Representative Office of the Bank Indonesia (BI) said that the performance of tourism and construction businesses on the Island of the Gods in the first quarter of 2026 slowed down due to the quiet season for visits and the added impact of the Middle East crisis.

Head of the BI Bali Representative Office Erwin Soeriadimadja explained that the tourism business sector, namely accommodation, food and beverage providers, and construction, each decreased.

Based on the results of the survey targeted at business actors on the Island of the Gods, the performance of the tourism business, which is the main indicator of economic activity in Bali, contracted by minus 8.32 percent in the first quarter of 2026, compared to the fourth quarter of 2025 which reached minus 0.67 percent.

Meanwhile, the performance of the construction sector also weakened to minus 1.78 percent from previously growing positively in the fourth quarter of 2025 by 8.88 percent.

He explained that the weighted net balance (SBT) value of business activities in Bali in the first quarter of 2026 was 17.91 percent, lower than the previous quarter which was recorded at 35.46 percent.

Erwin explained that the weighted net balance is a method by calculating the difference between the percentage of respondents who gave an increasing answer and the percentage of respondents who gave a decreasing answer, and by taking into account the weight of each business field.

The central bank assessed that the seasonal factor of the number of tourist visits that declined after the year-end holiday period or low season visit had an impact on the tourism, trade, and other supporting businesses.

Based on data on tourist visits from the I Gusti Ngurah Rai Airport management, there was a decrease in the arrival of domestic tourists and foreign tourists in the first quarter of 2026 by 10.85 percent.

The number of tourist arrivals in the first quarter of 2026 was 2.62 million people, lower than the previous quarter of 2.94 million people.

"This condition has the effect of slowing down people's purchasing power," said Erwin, quoted by ANTARA, Friday, April 24.

In addition, he added, global economic uncertainty also held back business performance in line with the ongoing war in the Middle East, which affected flight schedule changes.

Even though the tourism and construction sectors were affected, the financial services business sector still supported positive growth in Bali with a weighted net balance increase from 0.27 percent in the fourth quarter of 2025 to 3.22 percent in the first quarter of 2026.

According to Erwin, this increase was driven by the religious holidays of Nyepi and Idul Fitri in March 2026.

The business survey is held every quarter which provides information on business actors' expectations of inflation forecasts.

The survey was attended by 130 business actors spread across Bali and representing 17 categories of business fields.

Reporter : Dewa Ketut Sudiarta W