As the island faces mounting pressure from development, a proposed law on land conversion seeks to redefine the relationship between capital and community.
DENPASAR, Bali — In a pointed challenge to the developers and financiers shaping Bali’s physical landscape, Governor I Wayan Koster has posed a question that cuts to the heart of the island’s identity crisis: “Are you building Bali, or merely building on Bali?”
The distinction, delivered during a meeting with the Bali chapter of Nawa Cita Pariwisata Indonesia (NCPI) on Tuesday, frames investment not as a neutral act but as a choice with profound cultural and environmental consequences. For an island where rapid tourism growth has often outpaced thoughtful planning, the Governor’s words signal a deliberate shift toward regulatory scrutiny and a reassertion of local interests.
The Legal Weapon: A Regional Regulation on Land Conversion
At the core of this renewed stance is a long-awaited regional regulation (Perda) on land conversion, currently in its final legislative stages. Governor Koster has indicated that once enacted, the law will be enforced with uncompromising rigor. “I will be firm and carry out a cleanup,” he stated. “There are no other interests there.”
The regulation aims to halt the unchecked transformation of Bali’s remaining agricultural heartland into hotels, villas, and commercial developments. While awaiting its passage, the Governor has already issued Instruction No. 5 of 2025, imposing an absolute ban on converting productive farmland, sustainable food agricultural land (LP2B), and rice fields—regardless of their official classification—into non-agricultural uses.
This preemptive freeze underscores the urgency of the crisis. Provincial Secretary Dewa Made Indra recently acknowledged that, despite existing protections, the rate of agricultural land conversion remains alarmingly high.
A Forum for a New Economic Direction
The meeting also served as a precursor to the upcoming Bali Economy Investment Forum, scheduled for February 18 at the Sanur Special Economic Zone (KEK). According to NCPI Bali chair Agus Maha Usadha, the event is designed as a strategic dialogue to “clarify the direction of Bali’s economy and its future sources of growth.”
The forum represents an attempt to channel investment into models that align with the province’s stated values: sustainability, cultural preservation, and tangible benefits for Balinese communities. It implicitly asks investors to move beyond the transactional logic of land acquisition and profit repatriation toward a more collaborative, long-term commitment to the island’s well-being.
The Bali Question for Global Capital
For expatriate residents, foreign investors, and the global business community operating in Bali, Governor Koster’s rhetoric is more than political posturing. It is a formal notification that the era of permissive, loosely regulated development is drawing to a close.
The emerging framework signals that future projects will be evaluated not solely on their financial viability, but on their integration with Bali’s social fabric and environmental thresholds. The question “Building Bali or building on Bali?” reframes investment as a partnership with custodial obligations, not merely a commercial transaction.
The outcome of this legislative push and the sincerity of its enforcement will define whether Bali can recalibrate its growth model. For an island whose very desirability is rooted in its cultural and natural distinctiveness, the distinction the Governor draws is existential. Building on Bali extracts value; building Bali preserves the asset. The coming months will reveal which path the island’s investors choose to take.