Indonesia Govt Offers Transportation Infrastructure Projects Investment
Indonesian government again offered two types of land transport infrastructure projects, such as terminals type A and weighbridges. Photo by Privacy.

JAKARTA (TheInsiderStories) – Ministry of Transportation (MoT) and Investment Coordinating Board (ICB) offered two types of land transportation projects namely terminals type A and 134 weigh bridges. The total projects has valued around Rp1.1 trillion or worth of US$76.97 million with public private partnerships (PPP).

“This is guided by Government Regulation Number 27 Year 2014, concerning Management of State or Regional Property and Ministry of Finance Regulation Number 78/2014 concerning Procedures for Utilizing State Property,” said director general at MoT┬áBudi Setiyadi in an official statement last week.

The partnerships also based on Presidential Regulation Number 38 Year 2015 concerning Government Cooperation with Business Entities in the Provision of Infrastructure. And Minister Regulation Number 4 Year 2015 concerning Procedures for Implementing Cooperation, such as cooperation between the government and business entities for infrastructure development in the context of implementing the duties and functions of the government, especially in carrying out public services.

“This cooperation scheme is very potential to be utilized in the development of transportation infrastructure, which is currently still very much needed by the community and is expected to be a solution to the limitations of the government’s State Expenditure Budget in financing infrastructure development,” he added.

He elaborated, some of type A passenger terminals that will be cooperated are Tirtonadi Terminal Surakarta – Central Java, Mangkang Terminal Semarang – Central Java, Tawang Alun Terminal Jember – East Java, also Harjamukti Terminal Cirebon, Ciakar Terminal Sumedang, and Ahmad Sanusi Terminal Sukabumi in West Java.

Furthermore, Deputy for Investment Planning Ikmal Lukman said that the government has now made priority infrastructure provision to support efforts to achieve future economic growth targets.

“For the implementation of the program, the government has cooperated with State-Owned Enterprises and the private sector in order to overcome the limited government budget,” added.

Infrastructure development which is the focus of President Joko Widodo’ government has indeed resulted in an increase in the realization of investment at the transportation, warehouse and telecommunications sectors by Rp94.9 trillion in 2018, up 58.7 percent from 2017 which was only worth of Rp59.8 trillion.

The business sector is also the biggest contributor to investment realization in the first quarter of 2019 which only grew 5.3 percent to Rp191.5 trillion. Based on ICB data, the realization investment in the transportation, warehouse and telecommunications sector was Rp37.3 trillion or rose 19.1 percent to same quarter in 2018.

That figure far outperformed other business sectors such as electricity, gas, and water Rp33.2 trillion (up 17 percent), construction Rp19.5 trillion (rose 10 percent). Then followed by housing, industrial estates, and offices of Rp18.8 trillion or jumped 9.7 percent compared to last year and mining of Rp15.1 trillion or lift up 7.7 percent.

Core Indonesia Executive Director Mohammad Faisal said the transportation, warehouse and telecommunications sector is part of the tertiary sector investment. There has been an increase in recent years in line with the rampant infrastructure development that has become the government’s priority, he added.

Every investment growth is strongly influenced by the direction of government policy and when the government places development priorities, the sector becomes one of the contributors. As long as the infrastructure is still a priority of the government, Faisal believes that investments in tertiary sectors related to the infrastructure will continue to increase.

US$1: Rp14,300

Written by Lexy Nantu, Email: lexy@theinsiderstories.com

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