91 infrastructure projects on offers at summit<\/p>\n
Urip Hudiono, The Jakarta Post, Singapore<\/p>\n
The Indonesian government will offer a total of 91 infrastructure
\nprojects worth up to US$22 billion to local and foreign investors
\nin next week's Infrastructure Summit.<\/p>\n
Coordinating Minister for the Economy Aburizal Bakrie said the
\ngovernment was also offering members of the Singaporean business
\ncommunity to help manage the financing of the projects, which is
\nhigher than the 37 previously stated by the government.<\/p>\n
"We have also seriously considered (investors') suggestion of
\nproviding them with tax incentives for investing in
\ninfrastructure projects," he said on Wednesday after a two-day
\nmeeting with major companies in Singapore.<\/p>\n
Aburizal explained that the 91 projects would be the first
\nphase of the government's massive development of infrastructure
\nprojects over the next five years.<\/p>\n
"Details of the projects will be presented and offered to
\ninvestors through open bids during the summit," he said.
\n"Following the two- to three-year projects, the government will
\nthen offer the next batch of projects in September or October."<\/p>\n
The government has estimated it would need some $75 billion to
\nfinance the infrastructure-related projects. But it could only
\nfinance approximately 20 percent itself, mostly for "economically
\nviable" projects. The remaining 80 percent is expected to come
\nfrom local and foreign investors.<\/p>\n
Head of the government's special team for infrastructure Raden
\nPardede earlier this week said the projects were expected to give
\ninvestors a return of between 15 percent and 23 percent on
\naverage.<\/p>\n
"We also expect investors to help in the reconstruction of
\ntsunami-stricken Aceh by becoming the contractors or suppliers,"
\nAburizal said.<\/p>\n
He also explained that the government's plan to ask
\nSingaporean financial institutions to manage the projects, was
\nbecause foreign investors usually consulted with people in
\nSingapore before investing in Indonesia.<\/p>\n
"Foreign investors usually ask Singaporean banks and analysts
\nabout investments in Indonesia and whether the (Indonesian)
\ngovernment is really serious about improving investment," he
\nsaid.<\/p>\n
"Singapore can help us prepare the projects' prospectuses and
\noffer them to the market."<\/p>\n
On the government's plan to give tax incentives, Aburizal said
\nthe incentives would be needed as some projects -- despite being
\ncommercially viable -- would still not be attractive enough for
\ninvestors.<\/p>\n
"The projects could be more attractive if, for example,
\ninterest income paid to investors were to be exempted from taxes
\nbefore the projects started generating revenue," he added.<\/p>\n
Such policies have gained a warm welcome from the Singaporean
\nbusiness community, 14 different groups promised to participate
\nin the summit.<\/p>\n
"Many are interested in investing in the development of
\nseaport facilities to help Indonesia's agricultural sector gain
\neasier access to the market," said Lee Yi Shyan, chairman of the
\nInternational Enterprise Singapore, a group of the city-state's
\nprominent enterprises.<\/p>\n
Singapore foreign minister George Yeo and Keppel marine group
\ndirector Lim Chee Onn, however, warned the government to keep the
\nprojects transparent and free from corruption to ensure success.<\/p>",
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"sponsor": "Okusi Associates",
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