Developers drawn to tourist magnet
Thousands of Australians will visit Bali for their summer holidays but few are likely to realise what lies beneath the surface. Or maybe they will
"THE magic is going," says Dan, a French expatriate living in Bali, lamenting the pervasive development boom in the Indonesian island province long considered idyllic by foreigners.
Since the 2002 and 2005 terrorist bombings, tourists, particularly Australians, have returned in droves. But, the word is, an environmental time bomb is ticking.
Seduced by the tropical beauty, stunning beach sunsets, surf sand and Balinese Hindu culture, tourists pack Kuta's bars and nightclubs and nearby Seminyak's upmarket hotels, villas and restaurants. Yet some are noticing cracks in the system as archaic utilities and infrastructure buckle under rampant development denuding the island's rainforests and coastline. Even the Balinese are in danger of disorientation from their attractive culture of customs, dance, music and art.
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Gridlocked traffic, pollution, rotating power blackouts, water shortages and sewerage and garbage embarrassments are threatening ecological sustainability and tainting the much loved island's image as a haven from the urban rat race. "If Bali continues in this way, it will collapse in 10 years," predicts Oswar Mungkasa, the executive of the country's National Development Planning Agency responsible for solid waste and drainage.
"For me, Bali is not as attractive as it was. Local government doesn't realise, because investors keep coming, it is sitting on a time bomb,"he says.
Mungkasa fears there'll need to be "a cholera outbreak [there was one in 1994] or some sort of wake-up call" before attitudes change.
Lack of awareness and absences of regulatory enforcement are recipes for infrastructure disaster, Mungkasa says. "Bali is a fantastic island. You can find anything there, from the culture, the sun, the sea, even sex. The environment is getting worse, but the tourists are still coming."
If they drop off, he says, lack of sanitation and other problems won't register with the locals.
"The [Balinese] mindset is not educated or aware. They see sanitation as a cost, not an investment. They dump their rubbish in the drainage system. They cannot understand why they should change their habits."
Although development restrictions apply on valuable beachfront property in Kuta, Legian and Seminyak, hotel construction continues unabated in defiance. Mungkasa denies there will be a moratorium: "It's just an idea; you cannot stop investment."
In the scramble for the tourist dollar, opportunistic investors are carving into what remains of untouched western and southern coastlines. Southwards from Canggu to Jimbaran and the Bukit, and recently westwards to Tabanan Province, developers are snapping up available prime property, prompting the sentiment that the 5600sq km island's charm is eroding along with the land. Regulations that stipulate buildings must be at least 100m from the high tide mark and no more than 15m high are constantly flouted, sources say.
As the jewel in Indonesia's tourism crown, Bali generates 30 per cent of national tourist revenue or an estimated $US3 billion ($3.4bn) or more a year.
Authorities are not looking to cap the island's lifeblood, contributing as it does more than 80 per cent of revenue to island government coffers.
Sydney expat Alasdair Stuart, a spokesman for inTouch Realty in Seminyak, the island's first real estate agency, sees no let-up in property sales, with values rocketing 100 per cent in the past 18 months in Canggu. He asks: "What economic crisis? There isn't one here. There is rampant and random urban sprawl."
Very little is left for sale in lucrative Kuta, Legian and Seminyak, which were fishing villages 40 or fewer years ago. "Until about a year ago, Batu Belig [south of Seminyak] was the last bastion where you could buy land. It's all finished."
Isolated areas such as Canggu, Tabanan and the Bukit are going the same way, even though much of the property is not even beachfront, with multimillion- dollar homes and hotels. Many of the investors are from Singapore, Jakarta and Hong Kong, Stuart says.
South of Canggu, three beachfront villas are for sale at between $US3.3 million and $US3.7m, while a record $US5.7m deal is being sealed on about 1.5ha of clifftop land in the Bukit, viewed as a tsunami-proof zone. "The Bukit has been explosive. Land has risen 500 per cent in the past five to six years. I think Bali is one of the most bulletproof places on the planet because property prices are fuelled by tourists all year round," Stuart says.
Foreign tourist arrivals, at 1.83 million for the 10 months, jumped 13.5 per cent from January to October, compared with 2008. They were expected to top two million by this week, with additional flights meeting demand. Australians, taking advantage of their stronger dollar, are topping the list, at 350,000 for the 10 months, a rise of 38 per cent, although Japanese tourists, ranking second, fell 9.13 per cent. The benefits for investors have been mixed. A trend to mid-range accommodation and villas has slashed luxury hotel occupancy rates to 65 per cent.
The island's infrastructure is fraying under the pressure. Electricity comes coal-powered from Java but there are no energy-efficiency incentives offered. Tempers are flaring over rolling blackouts lasting up to six hours since October. With no respite offered until mid-January, some islanders will spend Christmas and New Year in the dark. The wealthy residents, Stuart says, won't be affected because they buy two or three generators. "They are added to the list of things they need."
Under strain once from Asia's financial crisis in 1997 and now from increased tourism, the national electricity board, PLN, pleads insufficient funds for maintenance of its connecting north-west distribution plant.
Plans for more power plants remain at an impasse but a solar energy initiative looks encouraging. Indonesia, already producing solar panels more cheaply than those produced by China, is supplying overseas markets. It's hoped the domestic market in the tourist areas will be supplied this year.
Dysfunctional planning is frustrating. For example, new sewerage and drainage installation along the 4km tourist strip of Jalan Legian, a showcase street of fashionable shops and restaurants, has taken almost a year. Open trenches replaced footpaths, endangering pedestrians and drivers as business plunged. Despite the work, connecting pipes are not yet functioning. "We have to upgrade electricity, water, sewerage and telecommunications. But there is no proper planning. Kuta and surrounding areas has blown out in population and size. Infrastructure is not keeping up with development," says Bali Tourism Board head, Ida Bagus Ngurah Wijaya.
An environmental impact assessment study undertaken for the Bali Urban Infrastructure Project in 1998-2003 recommended the ideal population for the island was 2.4 million. It is now 3.4 million, plus the tourists.
When leading Indonesian environmentalist Yuyun Ismawati tested the water at Bali's ocean beach fronting exclusive hotels at Seminyak and Oberoi two years ago, the result was flabbergasting: "The lab told me it was sewage. It was actually sea water," she recounts. "I would not swim in the ocean in Bali."
Tourists complaining of sewage odour are concerned about swimming in the ocean, agrees the head of the Denpasar Sewerage Development Project task force, Wayan Budiarsa. Infections are feared. Says Ismawati: "People don't have proper septic tanks or sewerage collection so they discharge waste water to the rivers, which flows to the ocean. Only 10 per cent of household sewage is treated [by a new Denpasar project]."
Bottlenecks and pollution generated by one million motorbikes and huge gas-guzzling vehicles, such as people movers and Hummers, jostling on narrow roads, are a further environmental nightmare. "No one seems conscious of the fact Bali is a small island with limitations. Only 4 per cent of people use public transport," bemoans Adnyana Manuaba, a government adviser on sustainable development and physiologist from Udayana University in Denpasar. "The government is happy to receive a lot of taxes from motor cars," Manuaba says. He advocates a monorail or mass rapid transit to serve tourism, agriculture and small industry, not more roads. A previous rail plan never came to fruition.
Predicting a tourism backlash, Manuaba condemns continuing hotel development and blames a lack of holistic planning and weak law enforcement on infrastructure stagnation.
"The people have an `instant noodle' mindset. They want short-term gains, money," he says.
The established hospitality industry is getting nervous too. Stuart Smith, a Melburnian expatriate who has lived in Bali for 12 years, has three boutique hotels and complies with local laws. Smith says growth from large developers, even just in the past six months, is having a catastrophic impact on Bali's foreshores.
"Coastal land is being desecrated. It's like a shock wave and it's grown out of control," he says. He is a critic of one beachfront resort development, Sea Sentosa, being developed at what until now has been a surfing haven, home to a couple of small restaurants. This 2.8ha resort in Canggu will comprise apartments and villas and typical facilities -- a bar, nightclub, swimming lagoon, beachfront restaurants and retail outlets.
The development is built across an estuary just metres from the beach. It claims to be eco- friendly.
In online chatrooms, there is already concern about alleged noise levels, coastal erosion and water degradation. "[It] goes into a little surfing village with a 3m-wide road," Smith says. "It will include the infrastructure that goes with it, not the infrastructure that should go into it, that's the problem."
The Sea Sentosa company says it will "prove that development and environment are not mutually exclusive. We are developing responsibly and aesthetically as well as working on long-term environment and community initiatives such as beach and river clean-up programs".
When Inquirer visited the site, there were new roads. Medical waste is commonly dumped on the beach -- vials of blood, old vaccine, medicine bottles and syringes lay there -- metres from where local children were swimming in the estuary, women were washing, people were eating and surfers were enjoying the waves.
Ismawati, the environmentalist, did a study in 2004 supported by the Indonesian Ministry of Health and the World Health Organisation. He found untreated, hazardous hospital waste was dumped in rivers and the landfill. "Some ends up in the ocean, some is recycled. We have good regulations but no one is enforcing them due to operational costs," he says.
Some big hotels reputedly dump untreated sewage into the ocean but are being discouraged. Mungkasa, the official planner, says it is no longer permitted, but concedes law enforcement is impossible. "This year treatment is being done. But there is no penalty if sewage is untreated."
Something is being done. The Denpasar Sewerage Development Project, a 130km system to service mainly tourist areas and funded with a Y=5.4 billion ($650,000) loan, is due for completion in 2014. But Budiarsa says it "may take 10 or 20 years because it needs so much money".
Waste and drainage, controlled by local government, are huge problems, Mungkasa says. "They [Balinese authorities] don't have enough funding, not because they don't have money but because they don't realise water and sanitation are important. They know if they don't do anything the central government will, especially because it's a tourist area."
Jakarta allocates about 7 trillion rupiah ($800m) a year to Bali's infrastructure. Many argue revenue from the state-owned airport, such as tourism taxes and visa proceeds, should also flow to Bali, not back to Jakarta.
Ismawati, who won the Goldman environmental prize for the islands and island nations category this year and featured in Time magazine, reiterates the need for a development cap and financial assistance. While she was whitewater rafting at Telagawaja River in east Bali in June, operators told her she was lucky to strike a good day: the water level is often too low for the sport. "Sometimes operators stop serving tourists due to low water levels because of conflicting agricultural, domestic and tourism usages." Yet this source is earmarked this year for the domestic water supply in Karangasem in east Bali -- home to about 250,000 of Bali's poor, who have no nearby water access -- according to the Bali Public Works project manager for drinking water, I. B. Lanang.
Critically, 73 of Bali's 165 rivers are dry, while four major volcanic lakes contain sediment. Water from the city-owned company, PDAM, which is unable to provide more than 60 per cent of the water needed by the population, is being supplemented by free groundwater. Tourism, using 40 per cent of the island's water, is contributing to the exploitation of groundwater wells, many illegal.
Saltwater intrusion is evident. Deforestation and illegal logging is also reducing water resources in lakes in Bedugul, central Bali, the island's most important water catchment area.
Vast quantities of plastic bags, bottles and other debris littering streets, beaches, rivers and the ocean, are also tarnishing Bali's image, along with the ecosystem.. The island generates about 2000 tonnes of waste a day, mainly from southern tourist areas. "Only about 40 per cent is collected and sent to an open dumping ground serving Badung Province. This is the greatest source of greenhouse gas emissions, after forest fires," Ismawati says.
Investors, urged to improve landfills for which they would receive carbon credits, have not responded, she adds. Unwilling to pay for garbage collection, "most people dump rubbish, including factory chemicals and fertilisers, in the drainage or river. They also burn it. Though we tell them about the dioxins from burning, they still do it."
An integrated coastal management survey a few years ago found 64 per cent of tourists said they would not return because of the rubbish. Each tourist generates about 4kg of waste a day compared to about 1kg per local. Now Ismawati's BaliFokus Foundation is spearheading a campaign to reduce the 750 tonnes of plastic bags distributed and discarded yearly. Though waste to energy conversion has been touted, Ismawati says it is not viable. "It wouldn't work for Indonesia because most waste is wet. If you burn something wet it will release dioxins, especially if it contains PVC and plastics."
ALONG the beachfront at sleepy Batu Belig, near Seminyak, another huge villa development, due to open this year, is under way. A W hotel, part of the Starwood Group, is being built on 7ha of beachfront land.
Staff at the small adjacent beach warung shrugged when asked if they were concerned about the development, even though it may force their eatery's closure. Under a local planning law, building must include 30 per cent of green zones. "In theory the rules apply, but in reality it doesn't happen," says environmentalist Mungkasa, not referring to Batu Belig specifically. "Land boundaries and laws can be changed as long as the local government agrees." With the minimum wage set at R829,316 ($US82.90) a month, survival is the primary concern.
Another dilemma is the provincial government itself, which acquired autonomy only in 2000, and is often confounded by its role devolved from Jakarta.
"Since autonomy they can't cope. We can advocate but implementation is another thing," Mungkasa says.
The trend to luxury villa development is stretching the island to capacity, Smith says. "Hundreds of illegal villas, without permits or licences, are being built and there are increasing numbers of expats coming to live here, building houses. Is it great for Bali in the short term? Probably, but in the long term, it's going to implode. The past six years have gone crazy."
Mushrooming ecological resorts are also contributing to the destruction of rainforests and rice fields. "No development is [truly] eco-friendly. Rainforests are also being cut down to plant more rice," he says. Residents complaining that Bali has never been hotter point to diminishing green areas.
Early last month the Governor of Bali, Mangku Pastika, who had promised to regulate development, launched a green campaign promising water supplies for unserviced areas, tree planting, rubbish cleanups, organic fertiliser subsidies and some free local health services.
"But there is nothing about a development moratorium, or a transport, energy, waste or water balance," BaliFokus's Ismawati says. "Most of the leaders -- national and provincial -- have failed to make long-term projections. We can continue like this for 10 years, maximum. It is critical now; we are dying."
The 15km route to the airport from Smith's central Seminyak hotel has become so congested "we allow 45 minutes to get there. It used to be nine".
"When I first arrived in Bali, Kuta was just a beach with a couple of losmans [homestays] at the front," Smith says . "Now that little strip is the most expensive land in Bali. A lot of people have become rich from it, including the Balinese [who have sold land] but they've never been educated in financial planning."
While Smith concedes development is unavoidable, he says it must be policed. "There needs to be a lifeguard because it's way out of hand. In a controlled environment it can work well. We need professional, outside help. Bali is still a beautiful island but to sustain it for the next generation, we have to do something."
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