# Indonesian tourism supply and demand imbalance

> Live situation record from CLSTR: https://clstr.news/situations/indonesian-tourism-supply-and-demand-imbalance
> Updated: 2026-10-14T10:48:54.000Z. Sources: 5. Developments: 2.

The Indonesian tourism and hospitality sector is experiencing a period of supply growth coupled with stagnant or insufficient demand. In Bali, market indicators show a highly fragmented landscape where rising Average Daily Rates are masking a contraction in occupancy levels and weak real demand. This imbalance is attributed to a surge in capital supply and increased bank lending to the accommodation and construction sectors. Additionally, foreign visitor growth in Bali slowed significantly in early 2026 compared to the previous year.

Nationwide, data from the Indonesian Tourism Industry Association indicates that while the supply of hotel accommodations increased by 20.4% between 2021 and 2025, occupancy rates have yet to reach pre-pandemic benchmarks. Although occupancy improved from 2021 levels, it remained below the 54.99% recorded in 2019.

## Timeline

### 2026-10-14: Indonesia tourism supply grows but occupancy remains below pre-pandemic levels

Indonesian tourism supply has increased significantly, but hotel occupancy rates in 2025 remain below pre-pandemic levels. Meanwhile, experts suggest developing sport tourism in Bandungan.

2 sources. https://clstr.news/cluster/indonesia-tourism-supply-grows-but-occupancy-remains-below-pre-pandemic-levels

### 2026-09-20: Bali hotel market faces oversupply and slowing tourism demand

Bali faces a growing hotel oversupply and slowing foreign tourism demand despite stable provincial economic growth and rising construction lending.

3 sources. https://clstr.news/cluster/bali-hotel-market-faces-oversupply-and-slowing-tourism-demand

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Cite as: Indonesian tourism supply and demand imbalance. CLSTR, https://clstr.news/situations/indonesian-tourism-supply-and-demand-imbalance