The influence of macroeconomics and population in country of origin on tourist arrivals to Indonesia

This study aims giving an evaluation to develop the government and tourism agencies performance, which provides services, facilities, and infrastructures, whom Muslim-friendly, to attract the interest of Muslim tourist, that contributes to economic growth in Indonesia. It uses quantitative methods to examine the influence of macroeconomy and population in country of origin towards tourist arrivals to Indonesia. Regression panel data is used to examine the combination of time series from 2012-2017, and 5 countries from OIC, become cross-section data. It can be concluded that macroeconomy is not significant, while the population is significant towards Muslim tourist arrivals with 96% level influence. Therefore, the increasing of population from country of origin will rise tourist arrivals to Indonesia, which contributes to economic growth in Indonesia.


Introduction
Halal in Arabic means permissible, which labels permission to eat the food and beverages. Recently, halal is not applied to food, but also to all aspects of life. Along with the development of the era, there are ideas by integrating halal concepts in the field of tourism. This condition is an attraction for tourists to enjoy an interesting of Muslim-friendly, while investors catch the opportunity of the increase (Mohsin, et. al, 2016).
In several countries, the tourism industry is an important economic driving factor. This is based on macroeconomic growth and a large number of jobs (Santamaria, 2012). Tourism is a significantly growing sector in the world, which is the main driver of economic growth and socio-economic progress. This is indicated by the increase in foreign tourists, marked by the rapid development of the tourism sector (UNWTO, 2017). The tourism sector will be able to stimulate investment in infrastructure, labour, and technology in order to generate employment and tax revenues. In addition, competition is needed in order to increase the efficiency of local companies, and facilitate and exploit economies of scale (Jawad, Shahzad, Shahbaz, & Ravinesh, 2017). Thus, the development of the tourism industry, both managed by the government and the private sector, will have an impact on the country's economic growth (El-gohary, 2016).
Population growth in Muslim-majority countries makes halal tourism a target for improving a country's economy. Low-income countries from exports will rely on tourism in order to contribute to economic growth in terms of tax revenues and employment (Bojanic & Lo, 2016). Over the past few years, Islam and tourism have attracted several countries to develop tourism. This is based on the rising Muslim tourist population. This condition makes the halal tourism industry as the target of various countries to be able to compete in preparing Muslim-friendly facilities (Battour & Ismail, 2016). In 2030, the Muslim population will reach 26.4% of the world's population, which is estimated at around 8.3 billion people. This percentage increased by 3% form the estimate in 2020 of 23.4%, which is 6.9 billion people.
Indonesia strives to be the central of halal tourism, which complete the facilities and services in many sectors. This condition leads to Indonesia reached the World Halal Tourism Award (WHTA) in 2016. In this award, Indonesia won 12 awards in halal tourism (Greenwood, 2016).
Moreover, the Global Muslim Travel Index as a halal tourism assessment body represents that Indonesia ranks second in line with the United Arab Emirates after Malaysia in 2018. Meanwhile, the previous year was ranked third after Malaysia and the United Arab Emirates (Nugrahani, 2018).
Many Muslim and non-Muslim countries compete to attract Muslim tourists. By promoting the popularity of halal tourism, non-OIC countries, Japan (Yusof & Shutto, 2014), South Korea (Han et al., 2019;Nurdiansyah, 2018), and New Zealand (Razzaq, Hall, & Prayag, 2016) strives to provide tourism products, facilities and infrastructure that are Muslim-friendly (Samori, Za, & Mahyuddin, 2016). This has an impact on increasing demand and interest in the concept of friendly Muslims, especially on the arrival of Muslim tourists.
However, there are a few researches that addresses the demand for Muslim tourists who take from the perspective of Muslim tourist arrivals.  The growth of Muslim tourists is having slowly, around 20% of the total arrivals of state tourists to Indonesia (Nugrahani, 2018). This condition leads to the stright competition, which Indonesia must be able to compete with neighbour's countries, which also promote halal tourism as a mainstay of tourism in the country. In 2009, Malaysia launched the Islamic Tourism Center (ITC) as a part of the promotion of Halal tourism (Ghani, 2016). Furthermore, Singapore ranked first as a non-OIC country that promotes halal tourism (Nugrahani, 2018).
Indonesia as one of the international Halal tourism destination countries, which is also the largest Muslim-majority country in Southeast Asia (Yousaf & Xiucheng, 2018) has carried out many innovations in the development of halal tourism to balance neighboring countries. Some of these innnovations are in halal certification (Nurdiansyah, 2018) on food and beverage labels (Prabowo, et. Al, 2015), while for hotels and restaurants an Indonesia Hotel and Restaurant Association is formed to be able to make halal tourism packages at religious tourism places in Indonesia (Jaelani, 2017). The Ministry of Tourism launched the Indonesia Muslim Travel Index (IMTI), which is the standard for tourism actors in Indonesia who want to focus on developing Halal tourism. Furthermore, the aspects contained in the IMTI are improved from the GMTI standard (Angriyana, 2018).
Research on tourism demand that has an effect on the country's macroeconomics (Agiomirgianakis, Bertsatos, & Tsounis, 2018), found that an increase in GDP's country of origin would increase tourist arrivals in Turkey (Agiomirgianakis et al., 2018). This study also found that the increase in GDP of the country of origin would result in a decline in the proportion of total expenditure spent on Turkish tourism. International tourism is something that can be done by individuals or families who have high income and this includes luxury spending (Hongbumm, Park, Lee, & Jang, 2012). This condition makes the calculation of GDP per capita can also be used in this study (Ghani, 2016). Thus, the macroeconomic variables used are GDP and GDP per capita Furthermore, the Muslim population experienced a significant increase in the number of 1.8 billion population (Dubai International Financial Centre, 2018), which is expected to have a positive effect on increasing the arrival of tourists coming to Indonesia. Tourist expenditure contributed to GDP of 75.2% in 2017 and increased by 5.2% in 2018 (WTTC, 2018). Therefore, if this condition is improved, it will have a good impact on Indonesia's economic growth.
Some studies that investigate the relationship between tourism and economic growth define four hypotheses. Two hypotheses show unidirectional causality between two variables, both from tourism to economic growth, namely the hypothesis of tourism-driven economic growth and economic-driven tourism growth. Moreover, the other two hypotheses are hypotheses that support the existence of a two-way relationship between tourism and the economy or no relationship at all between them (Antonakakis, Dragouni, & Filis, 2015;Jawad et al., 2017;J. Liu, Nijkamp, & Lin, 2017;Perles-ribes, Bel, & Moreno-izquierdo, 2017). This is based on the expenditure of foreign tourists as well as the tourist country of origin rates which will affect the country's economic growth.
Tourism demand affects all economic sectors including individuals, micro, small and medium enterprises, private companies, and the government sector (Narayan, Sharma, & Bannigidadmath, 2013). This research is closely related to tourism demand (Song & Li, 2008). However, there is no study that examine more specifically for tourist from OIC countries. This research is a new study in order to increase the arrival of Muslim tourists and prepare Indonesia to become the centre of Halal tourism in the World.
This research will investigate that arrival of Muslim tourist from OIC countries who came to Indonesia in terms of the influence of GDP, GDP per capita, and the population of the tourist country of origin. This study aims to examine the influence of the macroeconomic and population of tourist origin countries that can increase the arrival of tourists from OIC countries to Indonesia. Furthermore, this research is expected to help the government and tourism industry entrepreneurs in evaluating and preparing Muslim-friendly services, facilities, and infrastructure, in order to attract the interest of Muslim citizens, which contributes to Indonesia's economic growth.

Research Methods
This study uses panel data from 5 OIC countries from 2012-2017. Furthermore, five countries studied were Malaysia, Saudi Arabia, Kuwait, Egypt, and the United Arab Emirates. Membership in the OIC countries can be used as a proxy because of the second largest organization after the United Nations (Ghani, 2016). The arrival of foreign tourists of 5 countries is taken from the report of the Indonesia Ministry of Tourism. Moreover, GDP and GDP per capita and population are collected from the World Development Indicator (WDI). Sampling in this study uses non-probability with purposive sampling due to the tourism ministry.
This study uses quantitative methods, which will test endogenous and exogenous variables with panel data regression. This study will examine the correlation between exogenous variables and endogenous variables; exogenous variables are GDP, GDP per capita, and population of countries of origin of tourists, while the endogenous variable is the arrival of Muslim tourists.

Figure 2. Conceptual framework
The model used in this study is pooled least square (PLS) using the Eviews application. The least squares method or pooled least square is the simplest method for estimating panel data and cross-section. This can be interpreted that the intercept and it is model coefficient will to change with individuals and time (W. Liu, Zhang, & Feng, 2019). Furthermore, the arrival of international tourists is the number of tourists who come to Indonesia. GDP and GDP per capita are factors that measure a country's macroeconomic, while the population is the population of the country of origin of tourists. This condition based on the previous study in Malaysia that uses those variables with additional distance to measure quantile regression (Ghani, 2016).
The first hypothesis, GDP has a positive effect on the arrival of Muslim tourists. A GDP's country of origin rises foreign tourist arrivals will increase. This condition leads to giving impact on the revenue sector in Indonesia, as the destination country for Muslim tourists. The second hypothesis explains that GDP per capita has a positive effect on the arrival of Muslim tourists. Furthermore, tourist arrivals are rising due to the increase in GDP per capita. The third hypothesis explains that the population affects positively the tourist arrivals, which increases and give impact to the tourist arrivals. These three variables have been tested for multicollinearity, and not found any BLUE, or refraction for GDP, GDPPC, and population towards tourist arrivals.
The model estimation in the panel data method is used to get the best model in analyzing the influence of GDP, GDP per capita, and population on the arrival of Muslim tourists to Indonesia, as follows: (1) (2) The variables in this estimation as aforementioned, firstly, the formula presents the estimation of panel data's regression. Secondly, formula that use in this research Muslim Tourist Arrival (TA) is the number of tourists from country. Gross Domestic Product (GDP) is the GDP of the tourists' country of origin. GDP at purchaser's prices is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products. Data are in current U.S. dollars. GDPPC is the GDP per capita of the tourist' country of origin and indicates in current US$. GDP per capita is gross domestic product divided by midyear population. GDP is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products data are in current U.S. dollars. Population is the population size of the tourists' country of origin. Total population is based on the de facto definition of population, which counts all residents regardless of legal status or citizenship.

Result and Discussion
This study aims to determine the effect of GDP, GDP per capita, and population of countries of origin of OIC international tourists on the arrival of tourists to Indonesia. The probability value obtained in the Chow Test in table 2 is 0.0000, the result is less than the real level used in this study, which is 5%, so enough evidence to reject H0. Based on the results of these tests indicate that the fixed effect model is accepted compared to PLS. Furthermore, the Hausman test results represent a probability value of 0.016, the probability value is smaller than the level of 5 per cent so that enough evidence to reject the hypothesis H0. The decision on the Chow Test and the Hausman Test represents that the FEM model is the best approach. The analysis data using a white heteroscedasticity cross-section standard error and covariance, the results are shown as in table 4.
There are changes in some exogenous variables experience statistical significance. The changes that occur are the result of the consistency of error variance which indicates that in the initial model there was indeed heteroscedasticity. With the high R 2 value of 0.9608 which means that the variation of endogenous models in the model of foreign tourist arrivals can be explained by exogenous variables GDP, per capita GDP, and a population of 96% indicates that the exogenous variables tested are quite good at explaining endogenous variables. However, in table 4 indicates the probability value of GDP of 0.84, in GDP per capita of 0.96, because more than alpha 0.05, the data is not significant. Whereas, the population probability value is 0.004, which is below 0.05 so that the data is significant. Then, the coefficient shows a positive value of 0.01816, which means that when the population variable rises, the variable arrival of foreign tourists increases. From the results of the analysis above, only the population partially can influence the arrival of foreign tourists because the probability value is 0.004 which is <0.05. It means that the higher level population of the country of origin of foreign tourists, the higher the arrival of foreign tourists to Indonesia. From the results of the analysis above, the population exogenous variables simultaneously influence the arrival of foreign tourists because the probability value is 0.00, which is <0.05. Then, the correlation is 0.96 which indicates that the population variable has an influence of 96 per cent and the remaining 4% is influenced by other variables.  Table 5 indicates that GDP has a negative effect on the arrival of Muslim tourists to Indonesia. However, the results of the p-value stat that exceeds 0.05 indicate that the size of GDP does not significantly influence the arrival of Muslim tourists. This can be caused by the large number of Muslim foreign tourists from nearby countries, namely Malaysia when compared to other countries. Meanwhile, Malaysia's GDP is not as much as 4 other countries, namely Saudi Arabia, Kuwait, Egypt, and the United Arab Emirates (UAE). In fact, the distance between Malaysia and Indonesia is not far compared to other countries which are the object of this research such as Saudi Arabia, Kuwait, Egypt and the United Arab Emirates (UAE). The results of this finding do not support the study (Agiomirgianakis et al., 2018), due to this study presents GDP has a positive effect on tourist arrivals to Turkey.
Furthermore, GDP per capita variable (GDPPC) has a positive influence on the arrival of Muslim tourists but is not significant. Not significant GDPPC can be caused by the countries studied had little data, thus not affecting the arrival of Muslim tourists from 5 countries. Therefore, the Malaysian GDPPC which is less than the other four countries also influences the relationship's significance. As aforementioned, Malaysia is the nearest country from Indonesia, close proximity compared to the other four countries. Malaysia is in the Southeast Asia region, where Indonesia is also in the same region, while Saudi Arabia, Kuwait, and the UAE are in the Middle East region, Egypt is on the African Continent. In fact, the impact of the decline in world oil prices, fluctuating GDPPC made 5 countries that also depend on world oil experience a decline from the economic sector (Albaity & Mustafa, 2018). Thus, the macro economy of the country of origin of Muslim tourists is less influential. This is also supported by GDPPC Malaysia, which is smaller than Saudi Arabia, UAE, and Kuwait, but larger than Egypt.  (Ghani, 2016), which explains that the population of the country of origin is influential.

Conclusion
This new research suggests that the macroeconomic of the tourist country does not affect the arrival of foreign tourists to Indonesia, while the population of countries of origin influences tourist arrivals. The increasing Muslim population in accordance with the Islamic economic development report, provides opportunities for the development of Halal tourism in Indonesia. This can be a reference for the government to be able to prepare facilities and infrastructure to welcome the arrival of Muslim tourists. This condition is prepared to increase Indonesia's GDP, especially in the field of Halal tourism. We can conclude that population factors from the countries of origin of Muslim tourists that continue to increase will affect the arrival of tourists to Indonesia. The results of this study will be able to expand the reach of Halal tourism to OIC countries that have the potential to contribute to foreign tourists to Indonesia.
Future research is expected to expand the reach of the OIC countries and add data and variables to get more satisfying results. The addition of macroeconomic variables from tourist countries, such as spending and receipt of Muslim tourists will add to the scientific treasure for future research.