Ep 38: In Conversation: "COVID-19's Been Devastating for Bali," with Stuart McDonald, Travelfish

It’s six months since Bali-based Stuart McDonald last joined us on the podcast, which seems like a distant era. This week, Gary and Hannah chat with Stuart about the outcome of Bali’s reopening to domestic tourists, and its failed attempt to reboot inbound travel.

Stuart provides some poignant and revealing insights about how the island is coping without mass tourism. We also discuss Thailand’s special tours visa, Singapore’s decision to allow Australian and Vietnamese air passengers to return, and we look at what happens next for countries in ASEAN that are stubbornly refusing to open their borders.

Is a vaccine the only way to revive the region’s devastated tourism industry? All this, plus a soothing soundtrack of surf waves from Stuart’s beachside perch.

Show Notes

00:00:00 Hannah

Hello, wherever you are in the world and thanks for listening into episode 38 of The Southeast Asia Travel Show. Today we’re joined by Stuart McDonald, Bali-based publisher and co-founder of Travelfish. Welcome back Stuart.

00:00:12 Stuart

Thanks for having me Hannah.

00:00:13 Hannah

It’s been six months since we last spoke, so what you been up to during that time?

00:00:18 Stuart

Oh, I’ve been spending all of my time in Bali because I can’t really go anywhere else. I don’t think I’m unique in that situation. So yeah, we’ve just been in Bali. The kids are doing distance ed now, so I’ve been doing the schooling for them. And, I’ve just spent the last week or so down on the beach in Southern Bali because it’s school holidays.

00:00:47 Gary

And to prove that Stuart is actually in Bali, you can probably hear the surf in the background. What’s it like there at the moment, right where you are?

00:01:09 Stuart

It’s mid-week. It’s very, very quiet. On the weekend there was a few people here, but not anything like what it would normally be this time of year. I mean looking at the break now, there’s maybe a dozen people out there. Other days, it’s only been two or three surfers out there, it’s great. I mean from a from a visitor’s point of view - it’s obviously not so great for the businesses.

00:01:35 Gary

The last time we spoke, it was the beginning of April, which is six months ago. It just seems like a lifetime ago. This is a big, big question to ask, but how has Bali changed and not changed during that period?

00:01:49 Stuart

Well, day by day life hasn’t changed very much, overall. We had the domestic reopening to tourism and more businesses have reopened, the beaches were reopened and then there’s been an explosion in cases. Particularly once domestic tourism was reopened, and particularly when the airport was reopened. So the two biggest centres for flights into Bali are Surabaya and Jakarta, which are home to the two highest number of COVID-19 cases in the country. So not surprisingly, Bali’s numbers increased.

Then the hospitals filled up and then the death rate increased. It sort of dropped back a little bit. If you look at the pre-reopening of domestic travel by case numbers, the seven day average was around about 50 a day. And then within a month of reopening to domestic travel, it went up to 160 a day and since then it dropped and then picked back up again. At the moment we’re floating around 100-120 a day.

There’s been some suggestions that the reason there was a big dip was because the hospitals were running out of the region, the required for the swab testing, but I mean, that’s something that’s on Facebook. So I mean, who knows if it’s actually true or not? So at the moment they’re very, very determined on making people wear masks and genuinely, that’s pretty well adhered to. I mean in a couple of tourism quarters there’s always a bit of social media outrage about so and so who’s not wearing a mask. But when I’m on the bike riding around I I would say most people are wearing masks now.

And certainly in cafes and restaurants and business places, there’s masks everywhere. If the cops catch you without it, I think it’s either a small fine or some pushups on the spot.

00:04:07 Hannah

Like you said, you’ve been going out and around the island. What’s the overall impact of COVID-19 on Bali or any specific examples you could give us about how it’s affected the islands tourism?

00:04:21 Stuart

Well, it’s been devastating to tourism, vast numbers of hotels and cafes, restaurants remain closed. If you go down through the traditionally, um, mass market destinations like Legian and Kuta, it’s like a ghost town. It’s picked up a little bit with the pickup in domestic tourism, but it’s still a fraction of what it used to be like.

There’s still plenty of hotels that are closed. I read a stat, I think it was last month, where the occupancy rate in the hotels was something like 3%, but I’m not clear if that is 3% of the hotels which were still open, or whether it includes properties that have closed.

So yeah, it’s pretty grim. Interestingly, when I was coming down to the beach the other day, I got a gojek from my house to down to the beach area. And I was talking to the driver, ‘cause it’s about a 45 minute ride. He was from Banyuwangi in East Java and so he had gone back to Java, I think it was April. He said because there was just no business, it was a much stricter lockdown. At that stage he had then come back by August, but he said that he was still having a fraction of the business that he got back in the day, and he wants more foreigners to come because he reckons we tip a lot more than the Javanese. I mean, it’s pretty grim times.

00:05:54 Gary

If we go back a little bit to mid-June when the Bali Governor announced this sort of three phase plan for reopening: first opening up the tourism businesses and a lot of other businesses across Bali, then having the domestic reopening and then the plan at the time was to reopen in September. Was there a feeling of anticipation? Was there a sense of hope which has been dashed now? Or what was it like back at that point?

00:06:15 Stuart

It’s a difficult one to answer really as it’s dependent very much on who you spoke to. A lot of people felt that the 9/11 date was ambitious and very unlikely to happen, but others were banking on it, like a couple of the cookie cutter, mini hotel style places near my place. They started advertising for staff again, and now they’re closed, still. The 9/11 day was also always a tentative date from the Bali government’s point of view. But the thing is, they were doing the whole thing backwards. You can’t say, “OK, we’re open for business” without having agreements in place with other countries.

I mean, I certainly wasn’t very surprised to see the 9/11 date pushed back then.

00:07:11 Gary

This thing started to open up Stuart. You mentioned that tourists are coming back from the two big cities, Surabaya and Jakarta. But you mentioned that Kuta is a bit of a ghost town, so where are they actually traveling to?

00:07:23 Stuart

Well, they are still going to Kuta and Legian, also down into Nusa Dua. But it’s just a fraction of the numbers. I mean Indonesian domestic tourism traditionally has always been the number one inbound. It’s always been far larger than the international market, but still - the volume of people who are coming in now is a fraction of what used to come in back in the day.

00:07:47 Gary

And is that because of fear factor? Is that because there’s not enough flights? Or is it a combination of all those things?

00:07:53 Stuart

It’s hard to say. I mean, there’s quite a few flights where I’m where I’m staying at the moment. I can see the approach and the flights have been traveling in pretty regularly. I think there’s a fair bit of fear. The airlines are not supposed to be filling to capacity, but there’s been multiple reports of them just jamming the passengers in. You often only need a rapid test, which has fairly dubious accuracy, so I think there’s those kinds of considerations. I mean, when you look at the charts of virus infection rates, there looks to be a very clear relationship between reopening to tourism and the numbers going through the roof, but people are only coming here for like weekends and that kind of thing from Surabaya and Jakarta. So are they coming here? They catching it here and going back and taking it home? Or are they bringing it with them? I mean, nobody knows.

There was a story this morning about two Jakartans who had gone from Jakarta to Bali to Komodo, and there they’ve just tested positive for COVID-19. So they’ve been traveling, they’ve flown, traveled around in Bali. The story wasn’t specific where they went and now they’re in Komodo. So how many people have been exposed?

00:09:13 Gary

The problem that we’re starting to see is the circular impact. It occurs with returnees going back to countries, people going on holiday, then coming back. You know it’s not just a case about opening up the destination that you go to, it’s about what happens when you reimport or bring the virus back with you.

00:09:31 Hannah

Stuart, I saw that the authorities in Bali are still not officially linking the rising cases to tourism. Last week I saw that they said it was locals, it’s all locally transmitted. Therefore it’s kind of nothing to do with tourists.

00:09:49 Stuart

Yeah, there was a story yesterday where they were suggesting that perhaps there is a relationship between the two, but there was no clear evidence. I think the other thing with the numbers is it’s very difficult to take them all that credibly. A friend of mine, somebody who my wife knows, a foreigner who died a few weeks ago of COVID-19 - he wasn’t reported in the numbers because just before he died, he tested negative. So they don’t count him, even though in previous tests he had had COVID-19, but they cured it just before he died. So that means he doesn’t go into the numbers. So it’s that kind of thing, doesn’t really breed a lot of comfort I guess.

00:10:43 Gary

I follow you on Twitter and you’ve been quite a strong advocate, particularly the last couple of weeks, about actually closing the airport. I mean, what are your current thoughts on that?

00:10:52 Stuart

Absolutely, shut it down yesterday, like I don’t even have to think twice about that.

Bali is an island, so there’s a certain degree of natural protection and if they shut the airport down, if they mandate a swab testing at the East and West Ferry ports, then that will limit how many more potential cases are coming in here and then you use that window to try and get on top of what’s happening here. Particularly given the level of cases in Java and that the two main cities coming into here have the two highest numbers of cases, it just seems insane to be encouraging domestic tourism.

I mean, every time I read a story that’s saying we all need to support domestic tourism, we need to keep the industry going, instead I think that really the journalists need to be asking politicians how many collateral deaths do they think are a reasonable amount in order to keep the tourism business in business.

Indonesia, now they’re looking at about 300,000 cases or something? I mean, they missed their moment very early on. What they should have been concentrating tenfold times on was contact tracing ‘cause they’ve never had the infrastructure to do vast numbers of swab testing.

Indonesia should have been doubling down on contact tracing and quarantining people, they had months to do that. Once you’ve got quarter of a million cases in the country, contact tracing - where do you start? So I think it’s now in a very, very difficult position, and they squandered a period where they probably could have made some different decisions, so it may have had a ended up with a country not going in the right situation.

12:52 Gary

One of the questions I have been asked a few times in interviews recently is the difference between Asia and Europe. In terms of opening up, Europe had the summer. Asia, mostly a state closed down, but one of the cases I point out is Bali, because you know Bali did open up - albeit only for domestic tourists - and it’s having pretty much a similar impact to some of the European destinations when they reopened over the summer and now everyone is retrenching again, everybody is going back into lockdown. Do you see, that’s possibly could happen in Bali?

00:13:19 Stuart

Well, there’s been rumours that they’re gonna close the beaches again on October 5. But the thing is, they don’t. They don’t need to close the beaches. What they need to close is the beach clubs. If you’re going surfing on the beach, that is in the scheme of things is a fairly low risk activity. Going to a packed club where nobody is wearing a mask, everyone is getting hammered, it’s higher risk. So leave the beaches open, but close the beach clubs. They need to be more selective and say, “OK. What is really a high risk activity here? And so these businesses we’re gonna close and let’s see how that goes for trying to have a like a managed kind of lock down.”

We’ve just been through a very important ceremony [in Bali]. There’s been a whole bunch of religious ceremonies which can often have a ton of people, and so now people are waiting to see if we’re going to see another surge.

00:14:31 Hannah

So six months ago you were saying you thought it might take two years before international travel could recover. Have you changed your mind about that? Do you think it’s going to be longer now, shorter?

00:14:44 Stuart

I don’t think it’s going to be shorter. Um, I think it’s a difficult one to answer because everywhere is a different case, so if you look at, say, Thailand and Singapore, for example, there’s a story this morning about Singapore that they’re gonna reopen to Australia, except for Victoria and, Vietnam. But in at least Australia’s case, they can’t get out of Australia unless the government says so.

And then when you arrive in Singapore, you’ve got to pay $300 for a swab test and then when you go back to Australia you’ve still got to shell out for, what, $3000? Two week quarantine but how many people are actually up to doing that when normally you go to Singapore for like 3 days or four days? It’s a similar situation in Thailand. This special tourist visa thing, where it’s a 22-step process to get the visa.

I get the government’s desire to restart tourism in some way. But all this does is breed uncertainty and confusion: can I go to Thailand or not? There’s a story saying that on Koh Samui there’s going to be 1,000 CCTV cameras across the island to make sure the foreigners don’t sneak out of the resorts when they’re supposed to be quarantining?

I mean, it sounds like something out of a TV show like escape from COVID-19 island or something. I mean, it’s ludicrous. I think for a lot of people it’s just gonna be like, screw it, travel domestically, because there’s just too many moving parts. And governments are often just coming up with this unilateral ideas. Did Singapore talk to Australia before saying “Yeah, Australians can come here,” ‘cause there’s not much point saying Australians can come here if Australia isn’t gonna let Australians out.

00:16:40 Gary

Yeah, I agree with that. I think there’s a lot of political games going on to try and push opening so that you know, as you said, that these moves tend to be a bit unilateral. But that’s basically just trying to jolt the system to get other people to think the same way, but it doesn’t really seem to be proving to be the case.

I like your point there about moving parts and then how it’s very difficult to talk of a global or even a regional recovery at the moment because every part, even in ASEAN, we have multi-speeds in terms of the way the virus is being managed, the leakage in terms of cases across borders. A few weeks ago you proposed an alternative idea for Thailand’s reopening strategy that was interesting.

You focused mostly on independent travellers, but what was your thinking at that time and have you changed your mind since?

00:17:25 Stuart

Not really, I think. I still maintain that if a destination is going to require a two-week quarantine on arrival, then they need to be targeting people who traditionally spent a long time in the country.

There’s no point targeting a market that normally comes to Thailand for four days and saying you gotta do two weeks in quarantine before you can have your four days. You need to go and target a nationality that traditionally would spend 21 or 28 days in country. Then the two weeks is a possibility and so what I was suggesting was the budget travellers, who tend to travel for longer.

All the focus from the Thai administration has been on high-end properties. I mean, some of the alternative quarantine hotel rates are insanely expensive. So what I was suggesting was that you could feed something else into a more community-focused, more affordable option. And it was also working with existing properties in the country to sort of, say, Well, look, we want you to pick your best 20 guests over the last couple of years and ask them to come back.

00:18:48 Hannah

Yeah, I really love the idea. I think especially getting the community involved, because I think we’ve seen a lot of governments just making unilateral decisions as well. They’re not really involving the citizens in the decision whether to invite back tourists or how tourism should look like.

00:19:08 Stuart

There was a story yesterday where the Thai Ministry of Foreign Affairs has just launched a new website called Thailand is now or Thailand now, or something. It’s like a positive spin on all the news coming out of Thailand, but it doesn’t really serve any purpose, and I doubt that they would have talked to a single tourist to say, well, what would you like to see in the site like this? This is the kind of product that a bunch of talking heads come up with and sums up a lot of what we’re seeing coming out of that country.

00:19:47 Gary

Is it concepts which are put together by people who do not seem to have a very nuanced view of what the existing or pre-COVID tourism scene actually was? Yeah, I’ve said this a few times. What has really struck me over these past nine months is that governments understood the top line value of tourism, they understood that it was an ATM. It was a cash machine that was bringing in revenues to different parts of their economies, but they didn’t understand the complexities of the actual tourism sector and that’s become so apparent.

00:20:21 Stuart

Yeah, absolutely you know and they just talk about it in dollar terms. You know the this whole conflating quality tourism and high spend tourism, like they’re the same thing, but they’re not absolutely not. I mean, hard lessons for everybody to learn, that’s for sure. The travel industry is being absolutely devastated by this, and this shows you just how big the shadow of this industry is - that it’s not just your front desk staff, but it’s the drivers and the room service. People in the gardeners and all the families, relying on these properties. And the government - I’m not specifically talking about Thailand here - they need to do a better job of helping these people out.

00:21:16 Hannah

Definitely, I agree with that. So overall, how badly do you think independent budget travel and backpacking are going to be hit by the pandemic. Do you see them even recovering?

00:21:29 Stuart

Well, there was a story this morning that the Thai Travel Association want Thailand to remove the 14 day quarantine if the guest is coming from a low risk country. Maybe you could argue that’s possible. But then they went on to say, and will require that these people have to book all their travel through a travel agent.

So this is like rent seeking, and I mean backpackers don’t need to use travel agents. If they come up with something like that, and you got to go there, but you gotta book tours for everything, I don’t want to do that.

And I don’t think many other independent travelers would want to, but that’s not a big problem. Countries that are traditionally large sources for budget travel, like Australia and New Zealand, Germany, France, Canada. Their economies are in in a bad way.

Unemployment is going through the roof. How many people are actually going to have the money to be able to say, OK, I’m gonna take a six-month holiday to Southeast Asia? So yeah, I think it’s gonna be a long time.

23:04 Gary

Yeah, I guess that returns overlays the fact that, we really at this moment have no idea what’s going to happen with long-haul air travel. We don’t know how the airlines are going to be able to manage that, or even cope with that.

00:23:09 Gary

I guess the other important one is the collapse of STA travel?

00:23:13 Stuart

Yeah, well that’s only one of many travel agents that would have gone to the wall. But yeah, it’s a huge problem. I mean, I’ve been saying 18 months or two years. I mean it could well be longer. Particularly with the the situation in the Philippines and Indonesia. As long as it remains out of control in in those two countries, that’s really going to disable the whole region’s recovery, because Malaysia Singapore, Thailand - if common sense prevails, will not reopen to those two countries.

So that’s a challenge.

00:23:48 Gary

So we have time for a couple more questions. Travel is part of your life is part of your business. How would you feel about getting on a plane right now? Would you feel comfortable traveling domestically or internationally?

00:24:03 Stuart

No. No way.

I mean with the school holidays just started, we considered going to the Gili Islands or to Lombok. So for either of those I need to get on mass transit. I can either fly or take a ferry and there’s just no way I would do that at the moment. I know some of the coverage is saying air travel is safer and that kind of thing, but I’m just not willing to take the risk, particularly with my kids for a short beach break, if I had to fly.

If you know for some business reason or whatever it was unavoidable, then yeah, I mean I would do it. I wouldn’t be very happy about it. But for pure leisure, no way.

00:24:48 Hannah

Yeah, I think a lot of people feel the same. I mean I haven’t even been on a domestic travel trip yet. You know, I’m in Malaysia and it’s pretty safe here, and I still haven’t taken that flight yet, so I’m with you on that one.

00:25:00 Stuart

I think the fear is going to be, regardless of whether it is warranted, it’s gonna be a really big challenge for destinations.

Because once the destination has lost people’s trust, where people don’t feel that the government is being transparent about what is going on or what the situation is, then trust is something that is very difficult to earn back. People are gonna think, “I don’t believe these numbers, so if you’re lying about your numbers, whether also you’re lying about?”

00:25:32 Gary

It’ll take a long time, I think, to get over some of the problems that are coming out of it. I think you both make interesting points there. Stuart, where you are, the situation is quite different to Malaysia where our borders are still closed. We can travel domestically, but the numbers are much much lower. People are travelling. I’ve been on a couple of flights. People are travelling, very nervous, a little bit reticent, but they are getting on planes.

But I do wonder if they are able to travel internationally again, whether they will actually have a different fear factor than traveling domestically ‘cause we live in a sealed bubble at the moment, borders are closed and the cases are only really a few returnees and a few domestic transmissions, but once you can actually go to countries, you know it opens up that risk factor so much more.

00:26:15 Stuart

Well yeah, I mean you’re on your flying metal tube for six or 10 or 12 hours instead of an hour and a half. You’re having to clear customs and immigration and all these other areas, where despite the best efforts for separation, you’re still crammed in with a lot of other people.

And the fear is, you know, the fear is it only takes 1.

You know this is there was a really good story in The Atlantic the other day, talking about how the virus spreads. It was fascinating, but it was also terrifying and I think that fear factor, it’s not insurmountable. Governments will need to be very proactive in addressing it and making sure that people feel like they’re gonna be safe, that they’re not going to die because they decide to go to Thailand for a holiday.

00:27:11 Gary

I’m going to ask you both the same question, and I’m going to sit on the fence. Hannah, do you think the only hope for travel is now a vaccine?

00:27:22 Hannah

I hate to say it, as I wasn’t in that camp before, but yeah, I think it’s looking that way.

00:27:30 Stuart

I don’t know about the vaccine. At the moment there’s a WHO story that was saying there’s 169 different vaccine candidates, of which 26 are in the stage of human trials. So it’s not just gonna be a case of 1 vaccine. It’s like which vaccine have you got, like the Indonesian vaccine or the Australian vaccine or the whatever? the Russian vaccine? Or the Mexican one or whatever? And the thing is, that if everyone just wore a mask, if you argue a vaccine is, say 80% effective, then a mask is up there as well.

We don’t need to wait for everybody to wear masks. That we can all do today. I’m not a epidemiologist, I don’t know much about vaccines. I know a lot more than I really wish I did. But I don’t think it’s something you want to rush.

And if a vaccine is rushed out and it turns out to not be effective, or to maim or kill people, or cause problems with their children, then that’s gonna make it even more difficult when a decent vaccine comes out to get widespread adoption. The thing is, for the vaccine to work, it needs to have widespread adoption. We can have widespread adoption with masks today. Start there.

00:29:03 Hannah

Strong message! And Gary sitting on the fence, so come on.

00:29:11 Gary

OK, I’m gonna stay even further on the fence and say that I think you’re both right because I do think that the way the travel sector is looking at things, it can’t manage this. Now governments themselves have basically given up. When we look at those last few months at the beginning of the crisis, it’s really easy with hindsight to say, but if every country around the world had locked down in sync with China for for two months at the beginning of that, we may not be free of COVID-19, but we certainly would not be in this global mess that we’re in right now.

It’s a global chain of infection. We can’t actually solve COVID-19 individually in countries. We’re seeing that in Malaysia. Now we’ve had this lockdown. We have borders closed, but all we’re doing is pressing pause because as soon as the borders open again, you’re going to have the virus come back.

I agree with you about the vaccines in terms of who’s producing them, where they’re coming from. I mean, you look at our region and you’re looking at the way governments are starting to respond, and it looks like China will be very much the dominant actor in this region. But we don’t know how many doses you’ll need. I mean, like you said, we don’t know the epidemiology of all this.

At the moment I’ve been speaking to a number of travel sector people this week, they’re kind of resigned that the vaccine is going to be the only thing that’s going to bring back any confidence, but they’re not confident that that that’s going to happen anytime soon. The economic impacts are just getting worse and worse. We’re gonna turn into 2021 probably in no clear position of where we’re going then we are right now.

00:30:47 Stuart

Right, I mean, who would have said in March this year that we’d be having this conversation now in October?

I remember reading, talking heads back in March and April saying this is gonna be 3 months and then we’re done. Now people are saying it’s gonna be 3 years. In a call I was on the other day, I said maybe it’s gonna be 10 years and people laughed at me. I mean, I obviously I hope it’s not going to be 10 years. I mean the thing is, people don’t know.

Like I was saying earlier, there are so many moving parts, countries are not working together, each taking their own different approach. And as you said, in the case of Malaysia, as soon as you re-open the doors what happens? How do you deal with it when it comes back in again? This is where ASEAN should have stepped in months ago and said right we’re a regional body, we’re gonna have a regional approach to this, and let’s see how we go. But they didn’t know, and they’re not even meeting again until November, so that’s kicking the can one month and a half down the road, yeah?

00:31:49 Hannah

Well, that brings us to the end of our interview. So thank you very much do it. It’s been a pleasure having you on.

00:31:56 Stuart

My pleasure.

Resources

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