Indonesian Political, Business & Finance News

City to buy land for canal at market price

| Source: JP

City to buy land for canal at market price

Bambang Nurbianto, The Jakarta Post, Jakarta

The city administration has said it will pay the market price to
acquire land for the East Flood Canal, in a move it hopes will
minimize opposition from residents.

City Public Works Agency head Fodly Misbach said disputes over
land compensation were a major barrier to the project, which is
seen as vital for addressing annual flooding in eastern Jakarta.

"I will buy the land at market price after a new legal basis
for land acquisition is issued by the President so that we can
spend all of the funds allocated for the project in the city
budget," Fodly said, referring to the necessary draft
presidential decree regulating land acquisitions for government
projects.

Currently, the city purchases land for government projects
based on the value of taxable property (NJOP), as stipulated in
Presidential Decree No. 55/1995. The NJOP is always much lower
than the market price.

President Susilo Bambang Yudhoyono is currently looking into a
presidential decree that would require all parties involved in
land clearance to pay market price rather than the NJOP.

Jakarta Governor Sutiyoso said previously he and several other
governors had been ordered by the central government to draft a
decree on land acquisition.

According to Sutiyoso, he submitted the draft to Vice
President Muhammad Jusuf Kalla for approval by President Susilo.

Last year, the city allocated Rp 150 billion (US$16.67
million) to acquire 43 hectares of land, but only managed to
acquire some 9.87 hectares -- 8.54 hectares in North Jakarta and
1.33 in East Jakarta.

Fodly said the city had allocated Rp 450 billion to acquire
about 70 hectares of land this year.

The administration has so far only managed to acquire 36.67
hectares of 401 hectares of land required for the East Flood
Canal, which will run from the Cipinang subdistrict in East
Jakarta to the Marunda subdistrict in North Jakarta.

The canal is a joint project between the city administration
and the central government. The city administration has to
allocate Rp 2.47 trillion for land acquisition, while the central
government has to provide Rp 2.53 trillion for the construction
of the canal.

The canal was designed by the Netherlands Engineering
Consultants back in 1973.

The East Flood Canal and the existing West Flood Canal will
jointly create a semicircular canal that will take on overflow
from the 13 major rivers flowing through the city.

The 14-kilometer long West Flood Canal, running from Manggarai
in South Jakarta to Muara Angke in North Jakarta, was constructed
in 1924 by the Dutch colonial government.

When the East Flood Canal project was inaugurated in July 2003
by then President Megawati Soekarnoputri, its construction was
expected to be completed in 2007. However, that date seem
extremely ambitious now, given the difficulties with land
acquisition.

Sutiyoso has frequently said his administration will be unable
to resolve the annual flooding in the city until it completes the
East Flood Canal, which was also designed to serve as a water
transportation network in the capital.

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