01. Sabang Marine Tourism02. Basajan & Sapula03. Tsunami Education Centre04. Kawasatan Wisata Brastagi05. Kawasan Wiasata Danau Toba & Air Terjun Sipiso-piso06. Kawasan Wisata Pulau Jamur07. Kawasan Wisata Dansu Maninjau08. Kawasan Wisata Gunung Padang & Danau Kembar09. Kawasan Wisata Pulau Mendeh10. Kawasan Wisata Danau Sipin & Taman Mini Jambi11. Kawasan Wisata Pulau Rupat Utara12. Kawasan Wisata Danau Rumnai13. Kawasan Mega Wisata Ocarina, Sarpas,Teluk Lebong & Argo Wisata Topaya14. Kawasan Wisata Kepulauan Anambas15. Kawasan Wisata Sungai Musi, Jembatan Ampera & Pagaralam16. Kawasan Wisata Air Panas Suban & Sejarah Pengasingan Bung Karno17. Kawasan Wisata Terpadu Tn Waikambas18. Kawasan Wisata Matras, Tanjung Pesona & Air Itam19. Kawasan Wisata Tanjung Kelayang20. Kawasan Wisata Parai Tenggiri21. Kawasan Wisata Pulau Punai22. Kawasan Wisata Pulau Seribu, Culture Tourism, Project Pulo Mas & Argo Wisata Cilangkap23. Kawasan Wisata Anyer, Ciater, Tanjung Layar, Tanjung Lesung24. Kawasan Wisata Ujung Kulon

25. Kawasan Wisata Gunung Salak, Setu Depok & Rumah Kebun Cianjur26. Kawasan Wisata Maribaya, Gunung Galunggung, Situ Gede Waduk Kunungan27. Kawasan Wisata Prambanan28. Kawasan Wisata Seaword & Wisata Parang Beach29. Kawasan Wisata Pantai Malam Indah & Sungai Pencongan30. Kawasan Wisata Morosari Maritim, Senjoyo, Argo Wisata Pati & Colo31. Kawasan Wisata Tlatar, Taman Rekreasi Salatiga & Deyang Wonder Park32. Kawasan Wisata Karimun Jawa33. Kawasan Wisata Pulau Glagah & Sendang Sari34. Waterboom, Pulau Samas, Pang-kalan Aerosport Depok & Merapi Volcano Museum35. Kawasan Wisata Telaga Wahyu36. Kawasan Wisata Pulau Wisid, Marina, Bend.Diundung & Wisata Kab.Pasuruan37. Kawasan Wisata Ds. Wonokitri & Pasir Putih38. Kawasan Wisata Gilimanuk39. Kawasan Wisata Danau Batur, Kin-tamani, Sangeh, Desa Pengotan, & Agro Wisata Sokah40. Kawasan Wisata Ujung Tulamben, Candi Desa& Nusa Penida41. Kawasan Wisata Teluk Aan & Pulau Serunting

42. Kawasan Wisata Pulau Keramat43. Kawasan Wisata Haharu, Pan-dawai, Wulla Waijilu, Tubundung, Lewa & Waingapu44. Kawasan Wisata Pulau Sebanjar & Ds. Batuputih45. Kawasan Wisata Ternate - Kab.Alor46. Kawasan Wisata Ds. Beang47. Kawasan Wisata Pasir Panjang, Singkawang48. Kawasan Wisata Pacur Aji49. Kawasan Wisata Pulau Belandang50. Kawasan Wisata Riam & Tepian Sungai Pinoh51. Kawasan Wisata Taman Puting52. Kawasan Wisata Nyaru Menteng53. Kawasan Wisata Sabaru54. Kawasan Wisata Gosong Senggara & Gugusan Pulau Kecil55. Kawasan Wisata Tanah Bumbu56. Kawasan Wisata Danau Riam Kanan57. Kawasan Wisata Pasar Terapung Muara Kuin, Lok Baintan & Canal Tour58. Manggar Edu-tainment Zone ( MEZo)59. Kawasan Wisata Pulau Derawan60. Kawasan Wisata Mangrove & Bekantan61. Kawasan Wisata Pulau Amal Waterpark62. Kawasan Wisata Konservasi (Mice)63. Kawasan Wisata Perairan Pulau Kumba64. Kawasan Wisata Kepulauan Selayat65. Kawasan Agro Wisata Toraja66. Kawasan Wisata Mamasa, Polewali Mandar Bend, Sekka-sekka, Kunyi, Anreapi, & Argo Wisata Kanang 67. Kawasan Wisata Gunung Nipa-nipa

68. Kawasan Wisata Bungktoko & Teluk Kendari69. Kawasan Wisata Pulau Hoga, 70. Kawasan Wisata Pulau Pasoso Donggala71. Kawasan Wisata Teluk Palu, Tanjung Karang, Danau Poso & Wisata Kota Palu72. Kawasan Wisata Kepulauan Togean73. Kawasan Wisata Air Terjun Pillaweanbo74. Kawasan Wisata Pulau Dua Banggai75. Kawasan Wisata Kab, Boalemo & Tilamutu76. Kawasan Wisata Air Lombongo & Pulau Limba77. Kawasan Wisata Bunaken, Pulau Malayang, Pulau Boulevard, & Wisata Kota Tomohon78. Kawasan Wisata Halmahera Utara79. Kawasan Wisata Kec Wasile & Oba80. Kawasan Wisata Pesisir & Kep Tidore81. Kawasan Wisata Kep Sula82. Kawasan Wisata TN Manusela83. Kawasan Wisata Kep Banda84. Kawasan Wisata Ds Saporken85. Kawasan Wisata Pulau Wai86. Kawasan Wisata Yanbekwan- yenwaupnor87. Kawasan Wisata Biak Numfor88. Kawasan Wisata Mimika - Yahu - kimo - Peg. Tengah89. Kawasan Wisata Merauke

www.indonesia-tourism-investment.com | 1

This Prospectus has been prepared by the DirectorateGeneral for Tourism Destination Development (DG PDP) from the Ministry of Tourism and Creative Economy.vv

The primary mission of the DG PDP is to :

The principal responsibilities of the DG PDP within Indonesia are to:

The core vision of DG PDP is to :

6. Tourist expectations are becoming increasingly sophisticated, generating opportunities fornew niche products to create international market leadership

3. A healthy tourism industry invulnerable to the global financial crisis, with foreign visit or arrival sreached 8,8 million by end 2013;4. Realization of Foreign Direct Investment on tourism investment sector (hotel & restaurant) reached $ 462.47 Million in 2013, . Increase also occurred from the realization of Domestic Direct Investment where in 2012 its realization was USD 101.5 million and increased 38.11% by 2013 or as much as USD 140.18 million

7. South East Asia has the highest growth in international tourist by percentage of 10% compare to the global growth by percentage of 5%. Mostly supported by the emerging sources market as China, which increase $ 102 Billion by percentage of 28% in the first quarter of 2013.

5. Burgeoning low cost carriers in the region provide significant incentive for consumers to travelintercity or internationally, for both business and leisure;

The Indonesian archipelago is an idyllic tourism destination, with abundant naturalresources, high levels of biodiversity, and a friendly, ethnically diverse, pluralistic,democratic society Foreign investors are welcomed to invest in public realm facilities including infrastructure, utilities and transportation; and private realm projects such as hotels and restaurants; leisure and entertainment facilities; serviced and landed residential property; retail and other community assets.

At national and international levels, key influences on Indonesia’s tourism future include:1. Indonesia is an emerging global powerhouse in Asia. With the GDP expected to reach US$ 1 trillion in 2014, Indonesia is the largest economy in Southeast Asia. Much less affected by the global financial crisis compared to its neighboring countries, Indonesia’s economy grew by 5.7% in 2013, making “The World’s Most Stable Economy in the Last Five Years” according to The Economist Magazine.

Indonesia grew by 6.2% in 2012 and in 2014, stronger economic growth is expected around the lower end of the 5.8-6.2% range. Future economic expansion is expected to include more inclusive growth as nominal per-capita GDP is expected to quadruple by 2020, according to a Standard Chartered report.

2. Indonesia’s debt to GDP ratio has steadily declined from 83% in 2001 to be less than 26% by the end of 2013, the lowest among ASEAN countries, aside from Singapore, which has no government debt

Tourism Investment Overview

2017 The IMF projects Indonesia will be at2013 the top 3 fastest economic2012 growths among G20 countries

International Monetary Found World Economic Outlook Database April 2012

FDI(US$ Million)

GROWTH FDI%

DDI(US$ Million)

GROWTH DDI%

GROWTH %

TOTAL(US$ Million )YEAR

TOURISM INVESTMENT REALIZATION

346.4

768.30

2010

2012

13.02%

217.22%

39

101.50

9.24%

157.61%

351.1

869.8

2.60%

208.88%

306.52009 95.35% 35.7 50.00% 342.2 89.32%

242.22011 -30.08% 39.4 1.03% 281.6 -20.31%

462.472013 -39.81% 140.18 38.11% 602.648 -30.71%

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History

Evidence points to Indonesia being occupied by Homo erectus as much as 1.5 million years ago. Some 45,000 years ago, Homo sapiens having advanced maritime skills arrived. Austronesian peoplesfollowed some 4,000 years ago, forming the backbone of current population. Indonesia has been an important trade region since 7th Century when Sriwijaya and Majapahit ethnicgroups traded with China and India. Arab traders spread Islam from 13thC to 16thC. Dutch colonization to exploit spices from 17thC came to an end with Japanese occupation in 1942.

Assets and ResourcesArable land covers some 11% of Indonesia’s land mass. Permanent crops account for some 7%.Irrigated land covers some 67,220 sq km.Agrarian products include rice; cassava; peanuts; rubber; cocoa; coffee;palm oil [currently world’s largest exporter]; copra, poultry, beef, eggs, and pork.Agrarian products include rice; cassava; peanuts; rubber; cocoa; coffee;palm oil [currently world’s largest exporter]; copra, poultry, beef, eggs, and pork.Natural resources include oil; natural gas; nickel; tin; bauxite; copper; fertile soils; coal; gold; silver; and timberPrimary products and services include textiles; apparel; cement; footwear; chemical fertilizers;plywood; food and beverages; and tourism

There are some 150 volcanoes spread across the archipelago, some 76 active in recent history,with 8 volcanic zones currently active.The climate of Indonesia is tropical. Coastal highs typically range from 250C to 350C, and humidityaverages some 80%. Conditions tend to be more moderate in the highlands.There are two distinct hot - wet and hot - dry seasons. Over time, Indonesia has suffered environmental degradation, including deforestation, water and air pollution. The country is now an active party to a considerable number of international initiatives and agreements touchingon biodiversity, climate change, endangered species, and law of sea.

Indonesia is on the intersection of the Eurasian and Australian tectonic plates, whichmake it one of the world’s most geologically mobile nations.

Geology and Climate

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Indonesia is the world’s 4th most populated nation, with 250 million citizens(2013) with a growing population of 1.49% per year and a workforce of some 121,2 million (Feb 2013). Unemployment hovers at 6.1%. Overall population density = 134 / sq.km, 79th in world. Population density on Java is some 940 / sq.km (58% of total population).Countrywide population is expected to be some 265 million by 2020,and 306 million by 2050.

Population

Indonesia is one of world’s most culturally diverse nations. It has a civil lawlegal system, somewhat influenced by customary law, and increasingly, Sharia law. The State Motto is “Unity in Diversity”.The founding ideology, embodied in the Pancasila [sanskrit for five principles] is:

• Belief in One God • Just and civilized humanity• Unity of Indonesia• Democratic citizenship led by wise guidance born of representative consultation• Social justice for all people of Indonesia

State philosophy

Indonesia is regarded as the third most populous democracy, with the largestMuslim population. The President is both chief of state and head of government. Cabinet is appointedby him. The elected Legislative Branch consists of the Peoples Consultative Assembly [upper house], which deals with constitutional issues, and thelower House of Representatives, dealing with national legislative issues. A House of Regional Representatives is established in each province. The Judicial branch includes the Supreme Court, Constitutional Court, a Lower Court system, and Anti-corruption and Labor courts.The House of Representatives has 560 seats, shared amongst 9 parties. It is headed by the Democratic Party with 20.9% of vote in the last elections,sustained by a broad based coalition.

Politics

Indonesia consists of 30 Provinces, 2 Special regions, and a Special Capital District.Decentralization over last decade has resulted in Regencies (Kabupaten) andMunicipalities (Kota) becoming responsible to provide key government services.These entities are generally subdivided into Districts [Kecamatan], and Village groupings [Desa or Kelurahan]. Each village is divided into several administrative Citizen Groups (Rukun Warga) vGroups (RukunTetangga). In this manner, close contact can be maintained between grassroots and central decision makers.

Administrative Divisions

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Indonesia maintains fiscally prudent economy, which has been rewarded by vigorous growth by international standards (6.4% in 2011) and an upgrade to investment grade by Fitch and Moody in December 2011. Public and private sector both play a significant role in achieving a debt to GDP of less than 25%,a fiscal deficit under 2%, a current account surplus, and historic low inflation. A major weakness in the economy is fiscal drag from corruption and the excessive cost of petrol subsidies. Other significant political challenges include poverty, unemployment, inadequate infrastructure,and complex regulatory structures

GDP is around US$5.100 per capita (2012 est). The main contributors are Industry [47%]; Agriculture[14.4%]; and Services including Tourism [38.6%] (2012 est).Domestic consumption = 54.6% of GDP (2012 est).Main export partners include Japan; China; USA; Singapore; South Korea; India; Malaysia. Main import markets include China; Singapore; USA; Japan; Malaysia; South Korea; Thailand. Main tourism markets include Singapore and Malaysia; Europe (including Russia); Australia; Japan;China; South Korea; Taiwan; USA. Top tourism growth markets include China; Russia; India; Malaysia; Philippines; Middle East. In 2012 (est) the services sector employed 47.9% of labor force, edging out the traditional leader agriculture.

Economy

Indonesians are blessed with a sophisticated history of creative arts, crafts, fabrics, music and dance. Diversity may also be found in sports, physical contests, and martial arts.Different mythologies and cultural histories have resulted in distinctive forms of architecture and dress that distinguish main ethnic groupings. There is much to explore around the archipelago, in terms of living culture, and of course cuisine whichis regional in concept, with subtle influences from Europe, Middle East, India and China.

Culture and Sport

Indonesia actively participates in a broad range of international organization. The country is a founding member of ASEAN and hosts the ASEAN secretariat. It is also an active member of the UN; APEC; and G-20, and is a founding member of NAM and OIC. From somewhat nationalistic beginnings under Soekarno, Indonesia has generally pursued broadlycooperative international relations. Whilst there is current market tension regarding utilizationof resources, the tourism industry is experiencing positive reinforcement from all sectorsof government and civil society.

Foreign relations

• Median age = 28.2 years (2012) • Population growth rate = 1.9% • Urban population = 52% of total population • Urbanization rate = 1.7%• Literacy = 90.4% of total population• Mobile phone penetration 54% (2011) • Internet users = 24% (2011)

Social and cultural influences also originate from Indian, Arabic, Chinese and European sources. Languages include Bahasa Indonesia [a form of Malay and the official language]; English [The main language of business]; Dutch; and some 700 living dialects altogether. Six religions are officially recognized, namely: Sunni Muslim [86.1 %]; Protestant [5.7%];Roman Catholic [3%]; plus Hindu; Buddhist; & Confucian; each at less than 2%

8

www.indonesia-tourism-investment.com | 9

Central Government acts centrally to create an amenable environment for Foreign Direct Investment. It is responsible to alleviate poverty, improve education, prevent terrorism, consolidate democracy, stemcorruption, implement economic and financial reforms, hold security apparatus accountable for human rightsviolations, address climate change, and control infectious diseases.

Indonesia Investment Coordinating Board (BKPM) sits as the main facilitator between Government and Business in Indonesia. In association with other agencies, including Ministry of Tourism and Creative Economy, Industry it presents investment opportunities to members of the global business community, and provides investment – related services top otential and existing investors. BKPM is structured and mandated to provide investment services to investors with a one – stop – shop approach, in an efficient and effective manner, including the provision of licenses and investment facilities

Provincial, Regency and Municipal governments are generally responsible to:1) Priorities and encourage eco – tourism based community development; prepare cultural events; provide outr each to community; facilitate tourism investment.2) Regulate investment activity; Interpret and apply relevant laws, regulations, rules and recommendations;coordinate timely approvals and licenses; and ensure minimal impact of development on sensitive eco-systems.3) Train workforces; encourage entrepreneurship; and integrate decision making on economic social, cultural, and environmental issues, including health care, education and security.4) Undertake public realm development : provide goods and services, including means of access andpublic transportation; coordinate with State Owned Enterprises providing utility infrastructure; provide stewardship of protected areas under purview of others (forests, marine protected areas and national reserves).5) Facilitate social interaction between residents and visitors; adopt ethical, transparent standards of conduct 6) Define land allotted for development; deal with settlement issues; undertake master planning and spatial planning along with regional Bappeda office; Inform investors regulation; guide them through approval processes, negotiate with other government entities; advise on other practical investment, development and operational issues.

NUMBER OF TRIPS(MILLION)

+/- (%)%

+/- (%)%

+/- (%)%

AVERAGE SPEND(THOUSAND RP.)

AVERAGE TRIPS(DAY)

TOTAL SPEND(TRILLION RP.)YEAR

DOMESTIC TOURIST 2009 - 2013

234,38

245.29

2010

2012

641,76

700.00

6,91

5,63

150,41

171,50

9.06

9.31

229,732009 600,30 9,68 137,91 11.97

236,752011 662,68 3,26 156,89 4.31

248.00

2,02

3,61

2,08

1,01

1,102013* 711.00 1,57 176,32 2.81

1,92

1,98

1,92

1,94

1,90

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DES TOTALYEAR

652692

493799

2012

2010

592502

523135

658602

594242

626100

555915

650883

600031

6143282013 678415 725316 646117 700708

5488212011 568057 598068 608093 600191695531

613422

789594

674402701200

658476

717784

745451634194

586530

771009

621084683584

560367

770878

650071688341

594654

719908

656006693867

578152

807422

654948766966

644221

860655

7245398,044,462

7,002,944

8,802,134

7,649,731

International Tourist Arrivals 2010 - 2013