Investor doubt grows with each protest<\/p>\n
Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
Recent disturbances in the construction of a toll road here
\nhighlight investor uncertainty, which has been exacerbated by the
\ngovernment's failure to keep its promise to issue the much-
\nawaited regulation on land acquisition this month.<\/p>\n
The uncertainty is further quelling investor interest in the
\nsector, at a time when the country is in dire need of investment
\nin infrastructure, in order to support higher economic growth and
\nreduce unemployment.<\/p>\n
Just last week, residents of Pasar Kecapi and Jatiwarna
\nsubdistricts in Bekasi, burned tires and damaged parts of the
\nHamkam Raya-Jatiasih section of the Jakarta Outer Ring Road
\n(JORR) project, which had already been completed.<\/p>\n
The minority of landowners demanded state toll operator PT
\nJasa Marga -- the developer of the project -- pay them Rp 1.1.
\nmillion (US$107) per square meter of land used for the road.<\/p>\n
However, the company is only willing to pay Rp 300,000 per sq
\nm based on the taxable value of property (NJOP) in the area --
\nthe exact amount that most of their fellow landowners received.<\/p>\n
The protest forced roadwork to a halt, causing Jasa Marga to
\nsuffer huge losses. The remainder of the JORR project, with a
\ntotal length of some 30 kilometers, is estimated to cost $223.7
\nmillion.<\/p>\n
\"The government cannot prevent such a problem from reoccurring
\nin the future, unless the proposed regulation on land acquisition
\nhas been approved by the President,\" Minister of Public Works
\nDjoko Kirmanto told The Jakarta Post recently, referring to the
\nland acquisition proposal his ministry submitted to the President
\nfor approval.<\/p>\n
Djoko acknowledged there had been a delay in the issuance of
\nthe regulation due to legal problems, and that he could no longer
\nbe certain of the exact date of its issuance as the drafting of
\nthe regulation involved other institutions.<\/p>\n
\"The aim of the regulation is to provide investors with
\nguidelines for acquiring land for toll road projects, including
\nthe avoidance of lengthy negotiations and disputes with land
\nowners over land prices,\" he said.<\/p>\n
The regulation was supposed to be issued right after the
\nInfrastructure Summit in January, and is designed to encourage
\nforeign investors to take part in a number of state
\ninfrastructure projects.<\/p>\n
During the summit, the government pledged to provide
\nincentives and lay down regulations to improve conditions for
\ninvestors. However, most of its promises remain promises so far,
\nmostly due to legal problems.<\/p>\n
\"Drafting a regulation is not easy. But the government has
\nshown success in completing some five or ten regulations that
\nwere pledged during the summit,\" said State Minister of National
\nDevelopment Planning Sri Mulyani recently.<\/p>\n
Mulyani said foreign investors would be protected as the
\ngovernment would immediately complete all of the necessary
\nregulations in order for them to operate safely and finish
\nprojects on schedule.<\/p>\n
The failure to issue the regulations expediently could cause
\nland acquisition problems in other areas.<\/p>\n
The construction of the JORR's Veteran-Ulujami section is one
\nproject prone to disturbances by landowners.<\/p>\n
Although Jasa Marga managed to settle a land acquisition
\ndispute and continue with the project, it may encounter further
\nobstacles due to red tape at the Ministry of Public Works.<\/p>\n
The landowners, who had several times clashed with
\nconstruction workers disrupting roadwork are yet to receive the
\ncompensation that was promised to them by the ministry.<\/p>\n
The project was originally set for completion by May 2003.<\/p>\n
Key points in the proposed land acquisition regulation<\/p>\n
1. Local administrations are required to protect land allocated
\nfor toll roads by maintaining the land price in the areas, in
\norder to prevent brokers from inflating prices.<\/p>\n
2. The government will eliminate the rights of minority
\nlandowners to protect land ownership, unless an agreement is made
\non the compensation awarded by the government for the land.<\/p>\n
3. Land disputes will be resolved in courts, without halting the
\nongoing construction project.<\/p>\n
4. The government, via a special agency, will entirely handle
\nland clearance for toll road projects, as well as bailing out
\nclearance costs, with the investors repaying land acquisition
\ncosts later.<\/p>\n
5. All future land disputes, which arise after the toll road is
\nin operation, will be entirely settled by the government.<\/p>\n
Source: The Jakarta Post files<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/investor-doubt-grows-with-each-protest-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }