Rumbles of unease in Bali tourism industry

Bali's rumbling Mount Agung is starting to affect the economy of the holiday island and, if the eruptions and volcanic ash clouds persist, could spark a bigger wave of cancellations by visitors to Indonesia's main tourism destination as peak season beckons.

From January to September, Bali received 4.5 million foreign tourist arrivals, nearly half of the 10.5 million arrivals in Indonesia.

Foreign tourist arrivals to the majority-Hindu island rose 26% in the nine-month period on an annual basis, though dropped on a monthly basis in September when Indonesian authorities first raised the warning alert on Agung.

"Bali is about tourism, nothing else. If [the eruption] is prolonged for around one to three months, it will impact our tourism significantly," said I Ketut Ardana, chairman of the Association of the Indonesian Tours and Travel Agencies.

"We can feel a small impact now. The price of staple goods is increasing," he said.

Indonesia closed Bali's airport on Tuesday for a second day, stranding thousands of visitors due to the ash cloud. On Monday alone, it disrupted 445 flights that would have carried 59,000 passengers.

Chinese tourists have overtaken Australians to become the top visitors to Bali, representing around a quarter of arrivals in January to September. Australian and Japanese tourists are the second- and third-largest groups.

Foreign tourists spent about $1,100 (R15,091) on average during Indonesian holidays in 2016, according to tourism ministry data. President Joko Widodo has been trying to promote creation of 10 "new Balis" in other parts of the scenic Indonesian archipelago. But for many so far, holidaying in Indonesia means going to Bali.

As Agung spewed tall columns of ash, life continued largely as normal on Tuesday for villagers near the volcano who set up traditional markets and offered Hindu prayers.

Matthew Smyth from Ireland, a restaurant owner in Amed, about 15km from the volcano, said many businesses using rented land were threatened.

"Half of the businesses here are built on credit. If the situation continues many people will lose their land," said Smyth, who is also setting up a yoga retreat.