Jakarta. The government still owes vendors almost Rp 400 billion or around $24 million from national sports events back in 2021, according to tourism associations, citing that the late repayments had taken a toll on the industry.

Every four years, Indonesia holds the National Sports Week (PON). Athletes of over 50 sports disciplines from across the archipelago compete against one another at the quadrennial event. However, the Indonesian Congress and Convention Association (INCCA) and the Indonesian Travel Agent Association (ASITA) recently revealed the budgetary problem behind this major sports event.

INCCA’s chair, Iqbal Alan Abdulla,h revealed that the government still owed the vendors involved in the 2021 PON XX and the national paralympic games Perpanas XVI -- both taking place in Papua. The outstanding debts totaled almost Rp 400 billion.

“Many of these vendors are micro, small, and medium enterprises [MSMEs], such as caterers, transportation providers. exhibition contractors, and event organizers. They've been waiting for four years, which has put significant pressure on our members' businesses," Iqbal told a press conference in Jakarta on Wednesday.

Iqbal also urged Finance Minister Purbaya Yudhi Sadewa to improve the funding scheme for government projects. The government typically makes their payments once the event ends, so service providers have no choice but to cover the costs first. The payment can even be delayed by up to three months.

"Imagine if a large event costs hundreds of billions of rupiahs and an event organizer has to cover everything first. That’s very burdensome,” Iqbal said. 

The associations are also urging Purbaya to come up with a solution to enable the event industry to easily access bank financing. According to Iqbal, bank interest rates are quite high, not to mention the burdensome collateral requirements. ASITA’s chair, N Rusmiati, told the same conference that any improvements to the meetings, incentives, conferences, and exhibitions tourism (MICE tourism) can spur the national economic growth.