Govt urged to simplify project tender procedures<\/p>\n
JAKARTA (JP): Three Indonesian businessmen called on the
\ngovernment yesterday to hold \"limited\" tenders for infrastructure
\nprojects and to simplify procedures by setting up a cross-
\nsectoral committee to oversee projects.<\/p>\n
Sjamsul Nursalim of Gajah Tunggal Group, Fadel Muhammad of
\nBukaka Group and Husodo Angkosubroto of Gunung Sewu Group said in
\na joint press conference that the government should choose
\nlimited tenders for infrastructure projects over direct
\nappointments or fully competitive tenders.<\/p>\n
Direct appointments, applied in countries like Malaysia,
\nresult in uncompetitive prices, while fully competitive bidding
\noften places domestic investors at a disadvantage to
\ninternational players, they said.<\/p>\n
Only selected companies with experience in the areas should be
\nallowed to make bids, they said.<\/p>\n
\"Children of government officials can, of course, take part in
\nsuch tenders provided that they are really experienced in the
\nfield. If they are not, they shouldn't take part in the tenders,\"
\nFadel said at the press conference held at an international
\nconference on infrastructure development in Southeast Asia.<\/p>\n
International investors may participate in the tenders, but
\nthe government should have the political will to involve domestic
\ncompanies in the project by requiring international investors to
\njoin domestic firms, he said, citing an example.<\/p>\n
The three businessmen also expressed their concern with the
\nlong and tedious bureaucratic procedures that must be endured
\nbefore projects can be started.<\/p>\n
They called on the government to set up a cross-sectoral
\ncommittee that would be able to process everything related to a
\nproject.<\/p>\n
\"Today, it can take years to process everything at
\ngovernmental offices because we have to go to many offices. By
\nthat time we've already lost out on our financial commitments,\"
\nsaid Fadel.<\/p>\n
The three businessmen also noted that if private sector
\ncompanies are invited to participate in infrastructure projects,
\nthey must be allowed to make profit.<\/p>\n
\"There is a question as to whether infrastructure is a public
\nservice or business oriented. The conference has agreed that it
\nmust be oriented to business,\" said Husodo.<\/p>\n
State Minister of National Development Planning Ginandjar
\nKartasasmita said that Indonesia will need close to US$190
\nbillion for infrastructure development from 1997 to 2004, the
\nmajority of which is expected to come from the private sector.<\/p>\n
The three businessmen asked the government for \"facilities\" to
\nassure them of turning a profit.<\/p>\n
They suggested that investors be allowed to renegotiate with
\nthe government during the operation of their projects.<\/p>\n
Investors should be able to ask the government to lower the
\namount of income it takes or extend the deadline of an
\ninfrastructure project in case of low earnings or losses.
\nConversely, the government should also be allowed to increase its
\nincome portion in case of big earnings.<\/p>\n
\"Such a scheme is fair because it gives certainty that the
\ninvestors will be able to recover their investment and make a
\nprofit,\" said Sjamsul.<\/p>\n
The practice is reportedly common in many countries, he added.<\/p>\n
Fadel noted that if the management and operation of
\ninfrastructure projects have been given to private sector
\ncompanies, the government must stay involved to make sure the
\nprices of their services remain affordable to the public.<\/p>\n
\"If the government is not there any longer, the companies
\ncould raise the prices as they like, which could go against the
\ninterests of th public,\" said Fadel. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-urged-to-simplify-project-tender-procedures-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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