Infrastructure Projects in Indonesia Thrown Open for Bids
Ririn Radiawati Kusuma
Jakarta. In its continuing efforts to boost infrastructure development, the government is offering three projects on Java Island to foreign and domestic investors at a total combined investment value of around $4 billion.
“I think we can offer the projects by the first half of 2011 so we can start building the projects by the end of 2011,” Gita Wirjawan, chief of the Investment Coordinating Board (BKPM), said on Monday.
The projects include a 35-kilometer railway linking Soekarno-Hatta International Airport and Manggarai in South Jakarta that is valued at $735 million.
The government also invited investors to build the Umbulan reservoir in Pasuruan, East Java, worth $200 million and a 3,000 megawatt coal-fired power plant in Pemalang, Central Java, worth $3 billion.
It offered the projects under the so-called public-private partnership program it initiated in 2006.
Gita said the government would discuss the PPP regulations at the vice president’s office on Tuesday.
“We don’t have the candidates yet, but we prefer domestic investors,” he said, declining to mention possible names.
President Susilo Bambang Yudhoyono has so far pledged $140 billion of investment in infrastructure, including roads, ports and power plants, to boost economic growth through 2014, the end of this second-five year term.
Gita said the government had failed to build five infrastructure projects this year, citing procedural hitches as the cause.
Among those projects are the Tanah Ampo Cruise Terminal in Bali ($30 million) and the Medan-Kualanamu toll road in North Sumatra ($475 million).
He said he hoped the government, which has upwards of 100 projects it wants to offer to private investors, could offer those two projects after 2011.
Separately, Gita said total foreign and domestic investment would reach Rp 200 trillion ($22.2 billion) this year.
Domestic investment will account for 30 percent of that value while foreign direct investment will account for the rest.