The city tourism agency has reduced its projection for the number of tourist arrivals to the capital this year from 1.5 million to 1.2 million, following fuel price increases, says agency head Arie Budhiman.

He said Wednesday fuel price increases had consequently contributed to transportation fare increases and thus affected operational costs in the hospitality industry.

"Operational costs for the hospitality industry will definitely rise, although business players in the industry may have strategies to cope with the increases," he said at City Hall.

Arie said higher operational costs might reduce the number of tourist arrivals.

"A target of 1.2 million tourist arrivals is the most realistic target we can achieve this year in such an economic condition," he said.

The agency projected 1.5 million tourist arrivals in 2008 in accordance with economic conditions when the number was calculated.

The revised number was necessary because of a decline in tourist arrivals last year compared to a record number in 2006, he said.

According to Arie, tourist arrivals last year dropped by 76,000 from 1.1 million recorded in 2006.

The Jakarta Statistics Agency recorded 352,734 tourist arrivals in the first quarter, a 26.3 percent increase compared to 279,247 in 2007's first quarter.

In March alone, there were 129,789 tourist arrivals, up by 11.4 percent from 116,475 in February, according to the statistics agency.

The revised number will also cause a drop in the city's revenue from the hospitality industry.

"Last year we managed to collect Rp 1.2 trillion (US$128.55 million) in revenue from the industry," Arie said.

"We were hoping the industry would be able to chip in at least $300 million this year to the city's revenue with the projected 1.5 million tourist arrivals."

He said the agency had acquired Rp 30 billion from the 2008 city budget to be spent on the agency's programs, including tourism promotions.

Last year, the agency spent Rp 15 billion on promotions only.

In line with the nationwide program Visit Indonesia 2008, which targets 7 million foreign arrivals and $6.3 million in foreign exchange revenue, the agency is spicing up its programs with exhibitions and festivals, said Arie.

"Our top programs include old town events, batik festival and Jakarta festival weeks," he said.

Jakarta, a destination for many businesspeople, has facilities for the meeting, intensive tour, convention and exhibition (MICE) market.