Around 11:20 PM on Saturday, October 12, 2002, Bali was rocked by a series of powerful explosions. Paddies Bar and Sari Club on the main road of Kuta were reduced to rubble. Both entertainment venues were crowded when the explosions occurred, resulting in the deaths of more than 200 people.

This bombing had a profound impact on Bali’s tourism industry, which was still recovering from a string of global events: the Asian financial crisis (1998), the September 11 attacks in the United States and their subsequent wars in Iraq (2001), followed by the outbreak of SARS in East Asia (2002 – 2004).

As 90% of Bali’s income at the time was driven by tourism, within three months after the bombings, an estimated 100,000 people lost their jobs. Many businesses had to reduce staff working hours, implement unpaid leave, or enact salary cuts. The World Bank estimated that the average income decrease for the Balinese community was around 40% from November 2002 to May 2003.

Dr. Lawrence Blair wrote in his book “Paradise Rediscovered”:
Although the October 12, 2002 bombing in Kuta is the most remembered event that paralyzed Bali, it was just one of a series of episodes — beginning with the September 11, 2001 attacks in America, followed by wars in Afghanistan and Iraq, and the SARS epidemic in early 2003 — that dammed the tide of ‘globalization’ in such a way that both the world and the people of Bali were forced to reexamine what, if anything, made the island so captivating.

Long before visitors ceased coming, questions were being asked about the authenticity of Bali’s culture and the extent to which ceremonial traditions and supernatural beliefs could coexist with nightclubs and fast-food outlets like McDonald’s. The clear question was how a culture so deeply rooted in spirituality could comfortably coexist with these new gods, so clearly rooted in materialism?