BI to pay city for land conversion

BI to pay city for land conversion

JAKARTA (JP): After nine years of stalemate, the central bank
(Bank Indonesia) has committed itself to pay the city
administration Rp 37.8 billion (US$4 million) in compensation for
acquiring a city asset, formerly Jl. Budi Kemuliaan I in Central
Jakarta, in 1991.

The payment will be made within 30 days.

The commitment was spelled out in a memorandum of
understanding (MoU) signed by Governor Sutiyoso and Bank
Indonesia deputy governor Achwan on Tuesday at City Hall.

The event was witnessed by City Council Speaker Edy Waluyo.

"In order to avoid any more delays, the payment will be made
in the third week of December at the latest," Achwan said after
the signing of the agreement.

Meanwhile, Sutiyoso said the city would include the money in
its 2001 draft budget.

The governor said he was glad that the problem with the
central bank had eventually been settled.

"I am glad that the compensation can be paid swiftly because
it has been delayed since 1991 due to technical problems.

"I hope the central bank can fulfill its commitment as stated
in the memorandum of understanding," Sutiyoso said in his speech.

He explained that the 2,673-square-meter street was closed in
1991 as part of the central bank's expansion project. In the 1991
agreement between the city administration and the central bank,
the latter was required to relocate the street, which is now part
of the bank's office complex.

"However, the presence of Budi Kemuliaan hospital hampered the
relocation process. Finally, we (the bank and the city
administration) agreed on compensation, instead of relocating the
street.

"And the city council has approved the new deal," Sutiyoso
said.

The city council's letter of approval was signed by Edy Waluyo
on Dec. 4, 2000, following Governor Sutiyoso's request, dated
Oct. 11, 2000.

Edi's letter also marked the city council's endorsement of the
conversion of the street.

City administration spokesman Muhayat said that the city is
actually not allowed to sell its assets and should have the
street relocated instead.

"That's why renewing the deal was so difficult and important.

"But, we managed to reach a new agreement over the assets on
Nov. 21, 2000 and we'll sell the land at the current market
price, which is around Rp 13 million per square meter," Muhayat
said. (dja)