On October 12, 2002, the first Bali bombing killed more than 200 people, tourists and locals alike. Three years later, on October 1, 2005, the second bombing killed 23 people.
Bali's economy suffered a severe blow as a result of the events. The island is still recovering, and is seeking ways to improve the image of Bali as a safe and affordable holiday destination.
In 2004, the industry slowly recuperated from the first bomb as visitors began trickling back, even though rates remained low. In 2005, the island began to recover with numbers and tourist confidence increasing. The second bombings hit two separate locations on the island on October 1, 2005, and tourist numbers plummeted.
Meanwhile, several natural disasters that struck other parts of Indonesia, such as the earthquake in Yogyakarta or the mini-tsunami in Java, have also impacted the tourism industry on Bali. Despite the immense distance between the disaster locations and Bali, hotels on the island experienced many cancellations as a result.
The slumbering threat of a bird flu outbreak furthermore hurt the sector, with outbreak clusters discovered on a weekly basis in the country. Thus far however, Bali has not seen human victims of this disease.
"People seem to be more nervous about travelling" David C. Wilson, Representative of the Bali Hotel Association (BHA) and responsible for security, recently told OBG.
It is mainly the travel alert that countries like the US and the UK have imposed on Indonesia that prevent people from travelling to Bali, both in the leisure as well as in the meetings, incentive, conventions and exhibitions (MICE) segment.
Some observers note that this travel alert seems to be rather selectively applied, with other countries that were hit by terror attacks like the UK, the US or Spain not bearing such a burden.
"There are two main threats to tourism in Bali, namely security and natural disaster. Not that anyone can prevent these sort of disasters, but Bali has done very well in terms of providing training in emergency response, the only thing you can do to anticipate natural disasters," Wilson, who is also the general manager of the Ritz Carlton Bali Resort and Spa in Jimbaran, told OBG.
Bali has been one of the most popular tourist destinations in the world, catering to several different segments, from mass, low budget destinations such as the Kuta-Legian area, to more artistic areas around Ubud, to the upmarket areas of Sanur and Nusa Dua.
After the second bombings in 2005, the BHA realised that what happened in 2002 was not unique, but that they remained vulnerable to attacks. So the association commissioned a professional company to prepare a security risk assessment, to identify the risks and to develop a road map for future steps.
"One of the recommendations in the road map was to establish security green zones to break Bali down into more or less gated or controlled communities," Wilson said. These zones will be guarded by professional security companies, while in close coordination and cooperation with the local community.
This will be in combination with police efforts to improve security measures at key entry points to the island.
The central government earmarked $7m for the Bali Recovery Programme. This initiative will seek to create a special media programme to inform the public of Bali's newfound safety, and to promote, through journalists and travel operators, the island as the ideal holiday destination.
The first results are already noticeable, with tourist arrivals in July and August at encouraging levels. Maybe the best indication that the island is on its way back is the resumption of direct flights by Japan Airlines to Bali, and the commencement of direct flights by Australia's budget carrier Jetstar.
"Next year will be a year of stabilisation," Bagus Sudibya, chairman of the Bali Tourism Board, told OBG last month. "In 2008 the focus will lie on expanding the business, while 2009 will be the year of sustainability, ensuring that tourism development will not destroy the resources of the island," said Sudibya, whose organisation is one of the executors of the Bali Recovery Programme.