Rupiah and Foreign Investment: Analysis of Impact on the Number of Foreign Tourists in Indonesia 2005-2023

Jannes Maharaja, Muhammad Syafii and Daniel Ebenezer Silaban ()
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Jannes Maharaja: Universitas Sumatera Utara, Doctoral Program in Economic Science
Muhammad Syafii: Universitas Sumatera Utara, Doctoral Program in Economic Science
Daniel Ebenezer Silaban: Universitas Sumatera Utara, Doctoral Program in Economic Science

A chapter in Proceedings of the 1st International Conference of Economics, Management, Accounting, and Business Digital (ICEMAB 2024), 2024, pp 5-11 from Springer

Abstract: Abstract This research aims to evaluate the impact of fluctuations in the Rupiah exchange rate and foreign direct investment (FDI) on the number of foreign tourists visiting Indonesia during the 2005-2023 period. Using a quantitative approach, this research adopts the Partial Least Squares Structural Equation Modeling (PLS-SEM) model to analyze secondary data from Bank Indonesia, the Central Statistics Agency (BPS), and the Investment Coordinating Board (BKPM). The main variables analyzed include fluctuations in the Rupiah exchange rate (IDR/USD), hotel occupancy rates, number of international flights, FDI in the tourism sector, and the number of foreign tourists. The research results reveal that fluctuations in the Rupiah exchange rate do not have a significant influence on FDI or the number of foreign tourists, either directly or indirectly. FDI also does not show a significant influence on the number of tourists. Meanwhile, hotel occupancy rates show a significant influence on the number of foreign tourists, but not on FDI. The number of international flights has a significant influence on the number of foreign tourists, but not on FDI.

Keywords: Exchange Rate Fluctuations; Foreign Investment; Foreign Tourists; PLS-SEM; Tourism Infrastructure (search for similar items in EconPapers)
Date: 2024
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DOI: 10.2991/978-94-6463-614-7_2

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