Foreign investors invited to enter toll road projects<\/p>\n
JAKARTA (JP): Foreign investors will be invited to buy stakes
\nin 13 toll roads currently in operation or under construction in
\na rescue effort to stop them collapsing, a government official
\nsaid on Friday.<\/p>\n
Secretary-general of the Ministry of Public Works Sunaryo
\nSumadji said the more than 510 km of toll roads -- part of the
\nTrans-Java network connecting Jakarta and Surabaya -- should be
\nsaved because they had \"significant national importance\".<\/p>\n
\"We expect the entry of foreign investors either through
\nfinancial lending or strategic partnerships,\" he told the media
\non the sidelines of a seminar on infrastructure.<\/p>\n
Nearly US$1 billion is needed, he added.<\/p>\n
Sharp depreciation of the rupiah against the U.S. dollar has
\ninflicted a devastating impact on many toll road operations
\nbecause earnings were in local currency but most of their debts
\nwere in foreign exchange, he said. The decline in traffic volumes
\nand the government's decision to delay new tariff increase
\nworsened the situation of the toll road operators.<\/p>\n
\"Those under construction are faced with high interest rate
\ncharges.\"<\/p>\n
Sunaryo explained that several foreign investors had shown
\nstrong interest in participating in the refinancing, but further
\nnegotiations with the operators and the government were needed to
\nobtain a clear and precise risk sharing mechanism.<\/p>\n
\"The issue of certainty in the regular review of the toll
\ntariff will be the most difficult.\"<\/p>\n
Many foreign parties voiced unease at the unstructured basis
\nof the current review system, founded on a presidential decree.<\/p>\n
\"There isn't any guarantee for investors ... sometimes we
\nrevised (tariffs) every two years, sometimes in three years. It
\nreally depends on the sociopolitical condition,\" he said.<\/p>\n
Sunaryo promised the government would create a more conducive
\ninvestment environment.<\/p>\n
\"The government has embraced the need to establish clear, fair
\nand transparent policies, and regulations as a matter of
\nurgency.\"<\/p>\n
The 13 toll roads are part of 79 awarded to private companies
\nunder a build, operate and transfer (BOT) scheme. Most of the
\nprojects have been battered by the cumulative effects of the
\ncrisis and allegations of rampant corruption, nepotism and
\ncollusion practices in their operations.<\/p>\n
Sunaryo pledged that the government would make sure that the
\n13 toll projects were free of the practices before foreign
\ninvestors stepped in. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/foreign-investors-invited-to-enter-toll-road-projects-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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