Construction of subway project delayed by financial problems
Construction of subway project delayed by financial problems
JAKARTA (JP): The construction of the long-awaited subway
project will be delayed indefinitely because of new problems,
mainly from its financial scheme, an official said yesterday.
The head of the city's Development Planning Board, Budihardjo
Sukmadi, said besides the financial problem, the project also
needed government approval, which has not been officially issued
yet.
"Now everything is back to stage one again..." Budihardjo said
without giving details.
He declined to comment on whether the problem of the project's
financial scheme was caused mainly by a fare proposal from a
consortium in charge of the project.
The consortium consists of local companies PT Bakrie
Investindo, PT Pembangunan Jaya, Lippo Group, PT Bukaka
Corporindo and PT Steady Safe, and firms from France, Canada,
Japan, the United States, Germany and Australia,
"Just be patient for progress," Budihardjo said.
The US$2.2 billion project, which will connect Blok M in South
Jakarta to downtown Kota, was originally scheduled to start
construction in April, but was later delayed until June. And up
until yesterday no more news was heard about the project.
Aburizal Bakrie, who heads the Indonesian-Japanese-European
consortium, said in March that the government gave a green light
to investors to begin the 14.5-kilometer project.
The green light was given under several conditions, including
that the government would not provide any loan guarantees.
Bakrie denied that the project was delayed due to differences
over the fares. He also denied that there were technical or
investment problems concerning the subway project.
The consortium agreed long ago to fund 100 percent of the
project, he said.
The municipality, however, underlined the importance of a
presidential decree to approve the project.
Deputy Governor of Economic and Development Affairs Tb.M. Rais
said recently that the decree was essential to determine the
city's role in the project.
The 17-station subway was an initial step in a long-term plan
to ease traffic congestion.
The city and the consortium signed a memorandum of
understanding in August 1995.
In July 1996, one of Soeharto's sons, Bambang Trihatmodjo,
joined the consortium. (ste)