24 toll road projects, worth Rp 13t, canceled
24 toll road projects, worth Rp 13t, canceled
JAKARTA (JP): The Ministry of Public Works has canceled 24
toll road projects with investments valued over Rp 13 trillion
(US$2 billion) on the grounds that they were tainted with
corruption, collusion and nepotism.
Minister of Public Works Rachmadi Bambang Sumadhijo said on
Thursday among the canceled projects were the Solo-Yogyakarta
toll road in Central Java and Jakarta's triple-tiered project
developed by PT Citra Lamtoro Gung Persada, a company owned by
Soeharto's eldest daughter, Siti "Tutut" Hardijanti Rukmana.
The Pasar Minggu-Depok toll road project in Jakarta and a toll
road linking Jakarta-Jonggol-Cianjur, developed by PT Tri Daya
Esta, a company controlled by Tutut's brother Bambang
Trihatmodjo, was also canceled.
A toll bridge planned for the Sunda Strait, a project
developed by PT Pakarti Trimitra, a company linked to Soeharto's
young grandson Ari Sigit, was also canceled.
The ministry also canceled the Soedyatmo-Teluknaga-Tangerang
toll road developed by the Salim Group.
Rachmadi said although the 24 projects were yet to begin, the
projects had already gained approval from the Ministry of Public
Works.
"We decided to cancel the projects because the private
partners were appointed directly by the government without
competitive tender," he said at a media conference.
"However, we will retender or renegotiate contracts which were
vital to the state."
The projects were to be jointly developed by private companies
and the state toll road operator PT Jasa Marga.
Rachmadi said only 46 out of the 107 toll road projects
jointly developed by Jasa Marga and private companies were found
free from corrupt, collusive and nepotistic practices.
He said the ministry's findings indicated another 21 toll road
projects had received special treatment which were obtained
through political connections.
Nine of the projects were being renegotiated due to
construction being inconsistent with the deal and revenue
distributed unfairly in projects with large investments.
The projects included the Tangerang-Merak toll road in West
Java, developed by PT Marga Mandala Sakti, owned by Soeharto's
youngest son Hutomo "Tommy" Mandala Putra, the Surabaya-Gresik
road and the Waru (Aloha) Wonokromo-Tanjung Perak toll road in
Surabaya, East Java. Both are already in operation.
Another 12 projects, he said, were currently under
renegotiation because their deals were a potential burden for
Jasa Marga.
Jasa Marga's director of commercial development, Frans S.
Sunito, said his company was currently reviewing deals for
potential contingent liabilities, including clauses that require
Jasa Marga to take over debts from partners or provide bridging
finances for them.
Frans said five of the unfair deals, the Jakarta Outer Ring
Roads, the Cawang-Tanjung Priok toll road, the Harbor Road, and
the Cikampek-Padalarang toll road, were made with companies
linked to Tutut.
He said the developer of Cawang-Tanjung Priok toll road and
Harbor Road, PT Citra Marga Nusaphala Persada (CMNP), owned by
Tutut, secured a $175 million credit at a floating rate of an
annual 1.5 percent interest rate above the London Interbank
Offering Rate (LIBOR). The debt matured in August last year.
One of the clauses of Jasa Marga-CMNP's deals stated Jasa
Marga required to take over debts from its partners or provide
bridging finances for them.
The Jakarta outer ring roads (JORR) is currently in a
construction phase while the Cawang-Tanjung Priok is in
operation.
Rachmadi said the Indonesian Bank Restructuring Agency (IBRA)
was currently conducting a due diligence audit on five toll road
projects because the developers defaulted on debts to banks under
the agency's control.
"If IBRA takes over the toll road projects, Jasa Marga will
negotiate with IBRA on the future of the projects," he said.
The five projects, JORR, Palimanan-Cirebon toll road, Bekasi-
Cawang-Kampung Melayu road and the Surabaya-Gresik toll road,
have an investment value of Rp 4.1 trillion.
He added the government now expected the toll road projects to
be taken over could be continued with $6.5 trillion soft loans
provided by the Japanese government.
"One of the requirements for the special loans is any dispute
with the developers should be settled. But I'm quite optimistic
that we can get the loans," he said.
Frans said Jasa Marga had also canceled another 16 projects
which were still in a planning stage as further studies showed
there was no urgency to build them. (gis)