City Council stalling monorail over money
The Jakarta Post, Jakarta
City councillors rejected on Thursday the financing requirements demanded by monorail builder PT Jakarta Monorail, saying they would only burden the people.
The city administration has appointed PT Jakarta Monorail (JM) to build two monorail lines worth US$650 million.
The first, 14.3-kilometer green monorail line would pass along Jl. Taman Rasuna in South Jakarta, Jl. Gatot Subroto, Satria Mandala Museum, the city police headquarters, Sudirman Central Business District, Bung Karno sports complex, Palmerah, Pejompongan, Duku Atas railway station, Setia Budi Utara and central Kuningan.
The second, blue monorail line would link Taman Anggrek Mall in West Jakarta with Kampung Melayu bus station in East Jakarta.
The two lines are expected to begin operations in 2007.
JM, owned by PT Indonesia Central Transit (ITC) and Omnico Singapore, Pte. Ltd, had asked the city to guarantee its loan repayments, to give it an annual subsidy worth $20 million for seven to eight years, and to charge vehicles passing along the monorail corridors in an electronic road pricing (ERP) scheme.
JM also asked the city to pay $60 million into the project as equity sharing.
The new demands would allow JM to secure bank loans badly needed for the project.
ITC has invested $40 million into the project so far, while Omnico Singapore has paid in $100 million.
Chairman of the City Council's Commission D for development affairs Sayogo Hendrosubroto said the existing cooperation agreement should be revised if JM demanded additional requirements for the project.
"Under the current agreement, the monorail project is purely private investment. The city administration's involvement in the project would change the status of the endeavor," he told The Jakarta Post on Thursday.
Fellow Commission D member Arkeno said he could only agree to JM's proposal for the administration to have shares in the project, but not any subsidy or ERP.
"Any involvement of the city administration shows the city's commitment to the project," said Arkeno, a councillor of the Prosperous Justice Party (PKS) faction.
He said that it would not be fair if Jakartans shouldered the operational costs of the planned monorail.
"We should be spending such amounts of money on other urgent programs like poverty eradication," he told the Post on Thursday.
JM President Director Ruslan Diwirjo said on Thursday the additional requirements were needed to convince potential investors that the project received full support from the administration.
According to Ruslan, an ERP enforced along monorail corridors would ensure passengers used the service.
Deputy Governor Fauzi Bowo said the administration had not agreed to the new demands and further discussion was needed.