DOI: 10.36347/sjebm.2018.v05i08.011

Pages: 793-798

The government has announced a number of economic policy packages in order to strengthen the rupiah exchange rate against the value of the dollar. One policy is to increase the number of countries that get free visa for short visits to Indonesia, so that the total countries that have received the policy are 174 countries. This policy is one of the ways to increase foreign tourists to Indonesia; so that it can increase revenues obtained from the tourism sector and are expected to improve the performance of the trade balance in the services sector. This study aims to determine whether there is a significant difference between before and after the implementation of this policy, and identify the impacts that arise from the policy. Data is taken from the level of foreign tourist arrivals to Bali which is the main entrance of tourists to Indonesia. Based on the results of the analysis it was found that there were no significant differences between before and after the implementation of the free visa visit policy. The impact of this policy provides benefits to government revenues and also has an impact on the increasing activities of small and medium micro industries, in addition to having several potential negative impacts. The potential negative impacts include the occurrence of misuse of residence permits, threats of terrorism, drug smuggling, and human trafficking.