City to close down unprofitable markets
City to close down unprofitable markets
Damar Harsanto, Jakarta
Poor conditions and poor services have prompted city market
operator PD Pasar Jaya to close down some 50 non-lucrative
traditional markets through a "modernization" scheme.
"In the future, I estimate PD Pasar Jaya will be financially
healthy with only around 100 markets remaining operational in the
city," PD Pasar Jaya president director Prabowo Soenirman said on
Friday at City Hall.
In an initial phase, the operator will close down seven
markets, which are considered financial burdens. They are the
Blora, Karet Pedurenan and Kramat Baru markets in Central
Jakarta; Sawah Barat, Prumpung and Cipinang markets in East
Jakarta; and Kramat Jaya and Cilincing markets in North Jakarta.
PD Pasar Jaya cannot afford to renovate the markets, which
would cost an estimated Rp 8 trillion (US$889 million).
According to Prabowo, the renovation of certain markets would
be pointless anyway, as only a few vendors operated there, and
few people went there to shop.
"There have been changes in some areas where our markets are
located. The changes forced us to reconsider whether the markets
were still needed by the residents," he said.
He used, as an example, Blora market, which has been quiet
over the last three years as, while it was once surrounded by
houses, offices now stand in their place.
"We are planning to convert the market into offices or other
commercial premises... We are also looking into the possibility
of cooperating with city companies for that purpose," he said,
adding that cooperation with city companies would help maintain
the lower rental fees imposed on vendors and tenants.
City companies will manage businesses relevant to their core
businesses.
"(City run developer) PT Jakarta Propertindo will manage
offices or apartments, while PT Jakarta Turisindo will handle
hotels and PD Pasar Jaya will maintain markets," he said.
Critics say that city companies have overlapped in running
their businesses, as in the case of the construction of the
Jakarta Wholesale Center at the former site of the Melati dam in
Central Jakarta.
The center, which will become the country's largest wholesale
market for textile products, will be developed by PT Jakarta
Realty, a joint venture of private company PT Agung Podomoro and
PT Jakarta Propertindo.
Prabowo claimed that efforts to modernize city markets would
help the operator book more profit and improve its services to
the vendors, as well as customers.
PD Pasar Jaya only managed to book Rp 18 billion in profit
last year. As for this year, the operator has aimed to generate
profit of Rp 28 billion.