Sat, 12 Sep 2015
Singapore's experiences in urban planning could offer Indonesia a few lessons in unlocking its own metropolitan potential, according to a new report.

The report from Goldman Sachs called for a re-thinking of Indonesia's urban planning policies while making a case for a US$70 billion (S$99 billion) to US$90 billion programme to transform Greater Jakarta into a global city over the next 15 to 20 years, with "far-reaching investment implications".

"Indonesia would benefit from taking best practices from around the world, rather than trying to reinvent the wheel," said Goldman Sachs.

Jakarta has roughly the same land area as Singapore, but twice the population and no subway line. (It) is one of the few megacities without a metro, which, together with an efficient and functional transportation system, is crucial to creating a multi-core city.

"These best practices, which could offer roadmaps and principles to guide Jakarta's development, could be adapted to fit the local situation."

The report released last week noted that Singapore's affordable mixed-use neighbourhoods, for instance, could be Greater Jakarta's solution to low-cost housing.

Estimates from the United Nations Human Settlements Programmes show that Greater Jakarta is home to more than five million slum-dwellers, who make up about one-sixth of the city's population.

The implementation of developer regulations on low-cost housing provision is seen as being "patchy" in some parts of Greater Jakarta, said the report, citing the lack of clear guidelines and procedures.

It added that while President Joko Widodo's One Million Houses Programme - aimed at building one million homes this year and 10 million for low-income households by 2019 to reduce the backlog of 13.5 million housing units - is "well-intentioned", more can be done.

"We believe it would be more effective if it were implemented within a broader urban planning framework that includes provisioning of water, security, transport, designation of land, etc to proactively tackle potential problems before they surface and threaten the success of the programme."

The report also singled out land sale policies which guide long-term growth and renewal in Singapore, adding that Indonesia should consider introducing leasehold land tenures in parts of Jakarta.

"In Singapore, the sale of leasehold land tenures preserves land for the future and the use of varying land tenures provides flexibility to review development plans," it noted, citing how expiring industrial land leases in Jurong could potentially accommodate the new high- speed rail terminal.

"Indonesia could consider introducing leasehold land tenures, initially for commercial buildings in the central business districts and eventually to other areas in Greater Jakarta.

"Over time, this would allow for the rejuvenation of core areas in Jakarta, enable the government to build up its land bank for infrastructure developments, thereby minimising the difficult process of acquiring land from private owners, and act as a source of funds through land sales."

In addition, Jakarta should also prioritise green transport options, as Singapore has done, given that traffic congestion hinders decentralisation, said the report.

"Jakarta has roughly the same land area as Singapore, but twice the population and no subway line.

"(It) is one of the few megacities without a metro, which, together with an efficient and functional transportation system, is crucial to creating a multi-core city."

An efficient transport network, noted the report, will "greatly aid the creation of viable alternative commercial and business clusters by improving connectivity and reducing travel time between clusters".

"Modelling Jakarta around public transport systems also lends itself to high-density city planning and living where amenities are close to residential areas, and will naturally draw investments to the area if executed well."

Added the report: "With a proper urban blueprint in place, we see an opportunity set up to three times larger for developers in Greater Jakarta.

"Done well, we think the overhaul will lead to upgrades in the structure of Indonesia's economy over the longer run, create new opportunities for developers to tap into, and enable their operations to become more scalable."



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