Fragmented and Unclear Laws and Regulations of Foreign Direct Investment in Tourism in Indonesia

Foreign direct investment has a crucial role in boosting economic development of a host country. One of the most attractive investment’s sectors is tourism due to its unique character as a service industry. It has significantly contributed in creating job, tax income, and and domestic value added. However, foreign direct investment in tourism has also led to adverse impact, such as environment and anti-competitive practice. Maximizing the benefits and mitigating the negative impact, the existence of domestic laws and regulations is crucial to determine the extent to which a country’s success in gaining benefits from foreign direct investment in tourism. This paper aims to analyse the existing laws and regulations that regulate foreign direct investment, particularly tourism in Indonesia. This paper shows that the existence of foreign direct investment in tourism has been managed through fragmented and unclear laws and policies by looking at laws on investment, tourism, environment, labour and land in Indonesia.