Citra Lamtoro to start $1.6b road project in RP

Citra Lamtoro to start $1.6b road project in RP

JAKARTA (JP): Citra Lamtoro Gung, the business group chaired
by President Soeharto's eldest daughter Siti Hardiyanti Rukmana,
will soon start the first phase of its US$1.6 billion toll road
project in Manila.

Bambang Soeroso, a director of the business group, said here
yesterday that the initial phase of the toll road construction
would soon be carried out to follow the tie-up agreement signed
with the Philippine National Construction Corporation in Manila
on Wednesday.

He said that Citra Lamtoro Gung, under the tie-up agreement,
will establish a joint venture corporation with Philippine
National Construction Corporation to operate the toll road.

The joint venture firm, which will be named Citra Metro Manila
Tollways Corporation, will be 55 percent owned by Citra Lamtoro
Gung, which secured a license from the Philippine government last
year to carry out a feasibility study, planning, construction and
the financing procurement of the 36-kilometer Metro Manila Skyway
and 47-kilometer Metro Manila Expressway toll-road projects.

Philippine National Construction Corporation, an authorized
toll road operator in the Philippines, will have a 20 percent
stake in the planned joint venture company, while AIG-Asian
Infrastructure Group, a subsidiary of the American Insurance
Group which acts as a funding coordinator in the toll road
project, will have a 25 percent stake.

Bambang said that Citra Lamtoro Gung would not use domestic
funds to finance the project, one of the flagship projects of the
Philippine government.

"All of the funds for the Philippine toll road project will be
provided by overseas financial institutions," he said.

He said that Citra Lamtoro Gung, selected as the main
contractor in one of Malaysian toll road projects two years ago,
would not merely act as a contractor in the Philippine toll road
project.

"In Malaysia, we acted as a contractor, while in the
Philippines, we are acting as an investor," he said, adding that
his company would assign the state-owned Hutama Karya as the main
contractor in the Philippine project.

The first phase of the Philippine toll road project, which
will include the construction of a 9.2 kilometer-overpass road
linking Bicutan and Buenda, will cost around $500 million. It
will be constructed beginning this year and is scheduled for
completion in 1997.(hen)