Jakarta. The government is unlikely to tender five infrastructure projects worth $4.44 billion that were offered through a pilot public-private partnership program this year because a key regulation is not yet ready, an official said on Friday.<\/p>\n
Gita Wirjawan, chief of the Investment Coordinating Board (BKPM), told the Jakarta Globe that the revision was necessary to give the board a stronger legal framework to arrange licenses and other administrative procedures for investors.<\/p>\n
Gita had previously said the regulation would be ready this month, but he now estimates it will be delayed until December.<\/p>\n
\u201cWe had planned to offer one or two projects in October,\u201d Gita said. \u201cBut we need to talk to more stakeholders\u201d to complete the revision.<\/p>\n
The projects to be offered this year were a railway project to connect Soekarno-Hatta International Airport to Manggarai in South Jakarta ($735 million), the Tanah Ampo Cruise Terminal in Bali ($30 million), the Medan-Kualanamu toll road in North Sumatra ($475 million), the Umbulan water plant in Pasuruan, East Java, ($200 million) and a 3,000 megawatt coal-fired power plant in Central Java ($3 billion).<\/p>\n
The government has targeted a total of $160 billion in infrastructure investment to boost economic growth through 2015, with hopes that 42.8 percent of the funding will come through the partnerships.<\/p>\n
In the public-private partnership scheme, the government offers projects to private firms along with help navigating the maze of regulations that often stops development in its tracks.<\/p>\n
The BKPM had been appointed to serve as the \u201cfront office\u201d for marketing and registering PPP projects, taking over that portfolio from the National Development Planning Agency (Bappenas).<\/p>\n
The BKPM is seeking to make it easier for investors to secure permits, as dealing with local governments is often a time-consuming, frustrating process that is widely seen as a deterrent to investment.<\/p>\n
\u201cThis is because of complicated procedures,\u201d Gita said. \u201cIn the future, everything that investors need, we will manage here at the BKPM.\u201d<\/p>\n
The government has about 100 projects it intends to offer through the PPP scheme, but the slow pace of implementation has left many potential investors in doubt.<\/p>\n
The revision will complement changes to the land acquisition law, which are expected to be approved by lawmakers by the end of this year.<\/p>\n
Gita said the government\u2019s plan to develop six economic corridors throughout the archipelago in an attempt to boost regional growth would also be delayed by the revision.<\/p>\n
\u201cWe have not decided yet whether the project will run as a PPP scheme or not,\u201d he said.<\/p>\n
Gita said that Japan had expressed an interest in helping to develop the economic corridors, a project expected to cost $52.9 billion.<\/p>\n
\u201cJapan wants to build a clean, metropolitan high-technology area in each corridor in Indonesia,\u201d he said.<\/p>\n
In terms of funding, Gita hoped Japan would give some of the funds as a grant to Indonesia, with the rest coming from cooperative agreements between the two nations.<\/p>\n
He added that the Japan International Cooperation Agency and the Japan Bank for International Cooperation could act as conduits for the capital.<\/p>\n
Hatta Rajasa, coordinating minister for the economy, announced on Friday that the six-corridor plan would comprise 44 projects and would be completed in two phases, with the first to be finished by 2014 and the second by 2025.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/indonesian-infrastructure-ppp-projects-delayed-1287981409", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }