How to cite:
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino. (2021).
Analysis of foreign exchange grdp in the tourism sector on income in Batam
city. Jurnal Eduvest. 1(6): 416-422
E-ISSN:
2775-3727
Published by:
https://greenvest.co.id/
Eduvest – Journal of Universal Studies
Volume 1 Number 6, June 2021
p- ISSN 2775-3735- e-ISSN 2775-3727
ANALYSIS OF FOREIGN EXCHANGE GRDP IN THE TOURISM SECTOR ON
INCOME IN BATAM CITY
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino
Batam International University
E-mail: [email protected], [email protected],
[email protected] and [email protected]
ARTICLE INFO ABSTRACT
Received:
May, 26
th
2021
Revised:
June, 8
th
2021
Approved:
June, 15
th
2021
Batam City has a strategic location that makes tourists
stop by either its business related or travelling. For that
reason, Batam City built a lot of beautiful tourism places
with affordable price. The tourism sector has an important
role in improving the economy of Batam City. However,
Covid-19 pandemic impacted negatively towards the
sector for almost 2 years. The aim of this research is to see
how different the tourism sector in Batam City is before
and after the pandemic hits. And own known that research
take a result the economic batam has been decrease
during several year, and the problem has explain with
many indicator hypotasis. This study uses qualitative
analysis which will be explained descriptively, the things
listed are local income, GRDP, data for foreign tourists in
Batam, and graphs as an illustration in the study. From the
results of the study, it can be concluded that the
development and decline in the GRDP of Batam City
through the tourism sector industry which is expected to
continue to print foreign exchange for the country
continues to experience ups and downs. Conditions can
affect the level of income of a region. In terms of tourism in
attracting foreign tourists into the country with an
increasing number in the previous year, Batam City has a
positive GRDP figure so that it continues to experience
regional growth.
KEYWORDS
tourism sector, Covid-19, Batam City, tourists, Foreign
Exchange
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino
Analysis of foreign exchange grdp in the tourism sector on income in
Batam city 417
This work is licensed under a Creative Commons
Attribution-ShareAlike 4.0 International
INTRODUCTION
The tourism sector is one sector that greatly affects the economy in the largest
city in the Riau Islands, Indonesia, namely Batam City (Lubis, 2019). This is because
Batam City has many tourist attractions that attract tourists to visit every year (Harefa,
2013). Batam city also has a strategic location because it is on international shipping
lanes and borders Singapore, Malaysia, Vietnam, Thailand, Brunei, and Cambodia. So it
is not uncommon for residents to find foreigners relaxing or working in Batam cafes.
Although some of them only stop for a while in Batam City, they admit that Batam City
is a beautiful city with very friendly residents. The prices of products sold in Batam are
very cheap for them so that a stopover in Batam is considered a temporary vacation from
their work (Wiwik, 2015).
Tourism is a paradigm that characterizes the future of the sector and is reflected
in various practices such as ecotourism, nature-based tourism, heritage tourism,
community tourism, and rural tourism (Grilli, Tyllianakis, Luisetti, Ferrini, & Turner,
2021).
Batam City is one of the cities in the Riau Archipelago which consists of 12
islands such as Batam Island, Galang Island, Nongsa Island, Rempang Island, and many
more (Nadjmi & Prayitno, 2013) Each island has its charm that fosters the interest of
tourists to come to visit (Rizaldy & Supriono, 2018). The attractions are in the form of
nature reserve tourism, culinary tourism, historical tourism, shopping tourism, marine
tourism, and resort tourism. Not only tourist destinations, but Batam City also has unique
and affordable culinary tours (Supriono, n.d.). This city is surrounded by the sea so there
are lots of places to eat freshly served seafood (Hanisah & Achnes, 2017). Most of these
places to eat are located directly beside the sea, so there is no doubt about the quality of
the seafood.
Gross domestic product (GDP), as one of the most significant macroeconomic
indicators, is an important factor for measuring the level of economic development of a
country or region. This has a major influence on the future determination of
macroeconomic objectives and economic regulatory policies (Wu, Zhang, Chang, &
Huang, 2021).
According to (Amalia & Bendesa, n.d.) the tourism sector can directly contribute
to foreign countries with many foreign tourists coming. The growth of foreign exchange
reserves will make the tourism development process run more smoothly (Luturlean & SE,
2019). A country's foreign exchange reserves can describe how the economic situation in
a country is. This is because foreign exchange reserves are part of a country's
development factor. Foreign exchange reserves have a very important function for a
country to finance international trade and to increase funds for the country's development
(Antania, 2020).
The condition of foreign exchange reserves must be maintained so that
international transactions can continue stably and smoothly. We also need to know the
factors that affect foreign exchange reserves to carry out efforts to maintain foreign
exchange reserves at a safe level (Agustina, 2014).
However, in mid-2020 the entry and exit routes between Batam and foreign
countries were forced to close to avoid the wider spread of the Covid-19 virus. In 2020,
300,288 tourists were coming to Batam. However, due to the Covid-19 pandemic, this
number fell by 68.10% when compared to 2019 which reached 1.13 million. In 2019,
Batam became one of the cities in the Riau Archipelago which was designated as a
How to cite:
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino. (2021).
Analysis of foreign exchange grdp in the tourism sector on income in Batam
city. Jurnal Eduvest. 1(6): 416-422
E-ISSN:
2775-3727
Published by:
https://greenvest.co.id/
contributing city for tourists ranked second nationally, after Bali (Rizki, 2016). The
government hopes that in 2021 with the Covid-19 vaccine, conditions in the tourism
sector will run normally again (Purwahita, Wardhana, Ardiasa, & Winia, 2021). This
expectation came from the end of 2019 where Batam's economic growth exceeded the
national
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino
Analysis of foreign exchange grdp in the tourism sector on income in
Batam city 419
economic growth rate, reaching 5.9%. The government admitted that before the lockdown
or entry barriers from foreign countries due to the Covid-19 virus, millions of tourists
could enter and leave Batam.
Therefore, researchers feel the need to research the tourism sector of Batam City.
The research will be carried out by collecting data from the last few years until 2021 for
analysis. What are the factors that cause changes in the tourism sector in positive and
negative terms? The data that has been collected will then generate an idea that can be a
solution to current problems or help the tourism sector in the future.
This study aims to analyze how much of an increase or decrease occurred in the
city of Batam in foreign exchange earnings that focus on tourism. With all the
backgrounds that Batam City has experienced as a leading center of the tourism economy,
the author would like to examine and explain that all sectors related to tourism can
explain the situation and concrete data that can be accepted by many things.
RESEARCH METHODS
This study uses qualitative analysis which will be explained descriptively, the
things listed are local income, GRDP, data for foreign tourists in Batam, and graphs as an
illustration in the study. The approach used in this research is a rationalism approach that
is based on empirical theory and truth. The data collected is primary and secondary data
which will then be analyzed according to the research objectives. The primary data own
collect from information update about toursm during 2017 until 2019 by BPS Indonesian
Company and secondary data from journal. Analyze data own used by compared visitor
toursm between year to year and make a conclusion with a rational statement by data. As
a reference in the study, the author gives two indications of variables, namely the
independent and dependent variables. The dependent variable will lead to GRDP. Then
for the independent variables, namely the tourism sector, foreign exchange, and regional
budgets. The existence of these variables will have relations and compression that
produces research data, then will be analyzed in such a way as to describe the results of
the GRDP in Batam City. The applicable hypothesis will be as follows:
1. How does Batam tourism affect the GRDP of the Batam area
2. How Batam's foreign exchange can have an impact on Batam's GDP
3. Regional budgets affect the performance of increasing tourism to Batam's GDP
4. Some of the impacts that can be found that can affect Batam's GRDP.
RESULTS AND DISCUSSION
As a free trade area and port, Batam utilizes these ports as entry gates for tourists.
These ports also always have developments in terms of their facilities to be more
adequate in line with changing times. This change is made so that the transportation of
passengers and goods runs effectively and efficiently
Several explanations that can be described in the research involve a number of
research variables that have been determined. All variables have a positive relationship to
the results obtained. So that impact and outcome have a positive relationship in
correlation. When examining variable (1) where a tourism has a large influence on
regional income, it becomes something that brings tourists in. So that the positive
relationship is the result of the object variable.
Hypothesis (2) confirms that foreign exchange earnings have a direct relationship
with Batam's GDP. As the number two contributor to income in Indonesia, Batam has the
power to attract foreign tourists into the country. A positive relationship that is able to
Eduvest – Journal of Universal Studies
Volume 1 Number 6, June 2021
418 http://eduvest.greenvest.co.id
produce a large influence on the lowest to the smallest scale of the correlation. In
accordance with (Amalia & Bendesa, 2021) quoting from Afdi Nazir (2011) It is stated
that the growth of the country's foreign exchange reserves will increase Indonesia's
economic growth in the coming year
Hypothesis (3) the regional budget determined by the regional government is a
forecasting or design. The design is the main point of focus for the allocation of funds to
be distributed. The regional budget is also the main provider of funds in improving
existing facilities in the city of Batam. The complete and well-maintained modernity has
triggered foreign tourists to come to Batam, thereby increasing the existing foreign
exchange and income.
Hypothesis (4) national income is not only through one source such as the tourism
sector, many sources can increase national GDP starting from cities to each region.
National income supported by foreign exchange for each region is able to have a good
effect on the development of a country. When there is foreign exchange, it means the
country is also developing. The willingness of investors to invest in regions in Indonesia
is also something that can be welcomed for an increase in the GDP of each city, this is an
attempt to reduce the inflation rate in Indonesia. The more the number of people who
work, the level of work income increases and the unemployment rate can be reduced.
Therefore, a positive correlation relationship can provide a clear approach that each
variable allows to encourage an economy in several areas including Batam City to
increase.
Figure 1. Number of foreign tourist visits in 2017 – 2019
Source: BPS, 2021
Based on data obtained through BPS (Central Statistics Agency) there is an
increase in the number of foreign tourists when visiting Batam City. It can be seen that
some data show negative results, this means that there was a decrease in foreign tourists
in the previous month. When the number is positive, foreign tourists arriving are greater
than the previous month. Factors that influence the rise and fall of foreign tourists visiting
Batam City are climatic conditions, holiday atmosphere, and promos that take place in
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino
Analysis of foreign exchange grdp in the tourism sector on income in
Batam city 419
several
Eduvest – Journal of Universal Studies
Volume 1 Number 6, June 2021
420 http://eduvest.greenvest.co.id
PDRB Kota
Batam
8
6
4
2
0
2019
Range
-4
PDRB Kota
Batam
interesting places in Batam. However, when entering 2020, the Covid-19 outbreak had an
impact from early 2020 until now, turning the situation that Batam city should be filled
with foreign tourists until now it is very rare to find. So that it hampers the decline in
regional income, which is basically obtained through the tourism sector so that it is able
to generate foreign exchange for a place.
Tourists who enter Batam City from year to year almost always break the one
million visitor mark, no wonder every month there are around hundreds of thousands of
foreign tourists who always come to Batam City, both for vacation and to invest. There is
continuity between sources of income and foreign investment, resulting in changes in
GRDP (Gross Regional Domestic Product) in Batam City. GRDP here describes the
situation of the development of income that can be obtained every year, with the
possibility of decreasing or increasing. So that it becomes a consideration and benchmark
in making the right policies for the future.
Figure 2: GRDP of Batam City 2018-2020
The data source comes from BPS which is updated by displaying GRDP data that
occurred in Batam City in the period 2018 to 2020. In 2018 Batam City's GRDP was at a
value of 4.96, then followed by the following year which increased to 5.92 due to global
problems experienced In the world in 2020, the GRDP of Batam City experienced a
drastic decline towards minus -2.55 so that this decline experienced a felt impact for the
City of Batam. Because the biggest source of income is not only through exports but
comes from the tourism sector which was blocked some time ago.
CONCLUSION
From the results of the study, it can be concluded that the development and decline
in the GRDP of Batam City through the tourism sector industry which is expected to
continue to print foreign exchange for the country continues to experience ups and
downs. Conditions can affect the level of income of a region. In terms of tourism in
attracting foreign tourists into the country with an increasing number in the previous year,
Batam City has a positive GRDP figure so that it continues to experience regional growth.
Then the condition of self-closure from foreign tourist visits resulted in reduced foreign
exchange generated, as a result the contribution of the Batam City area to create profits
through foreign exchange continued to decrease with the lack of foreign tourists visiting.
Muhammad Azril Akbar, Vina Kristini, Honey Suvia and Marcelino
Analysis of foreign exchange grdp in the tourism sector on income in
Batam city 421
In the allocated regional budget, it is used for the development and completeness of
facilities to build good visibility in preparation for opening up later. So that the cause of
the decline in Batam's GRDP is not only through the locking of the port as a liaison
medium between countries, but also the export-import process which makes it difficult
for the two countries to run properly.
Overall GRDP Batam by sector toursm has been impacted by COVID-19. So that,
decrease economic local make too much unemployment and any industrial down
temporary exactly toursm. Government have decided with clearly for anticipate this
moment to build and growth this economic Batam with responsible nearly as soon.
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