Govt defends DRB-Hi Com role in JORR project
Govt defends DRB-Hi Com role in JORR project
JAKARTA (JP): The government brushed aside on Thursday critics
who doubted the competence of Malaysian investor DRB-Hi Com in
the long-awaited Jakarta Outer Ring Road (JORR) project.
Minister of Settlement and Regional Infrastructure Erna
Witoelar said the Malaysian company had sufficient equity to
support the toll road project, which is expected to cost DRB-Hi
Com and its Indonesian partner PT Jasa Marga Rp 5 trillion
(US$526.3 million).
"They didn't come to us empty-handed. We have checked their
financial report and they have prepared a Rp 1.2 trillion budget
for the project," she said.
Erna was responding to a group of House of Representatives
(DPR) legislators who demanded the government's clarification
over the propriety of DRB-Hi Com.
She said the Malaysian company had also earmarked around Rp
800 billion to free the land used for the construction project.
The project, covering 63 kilometers, will link all outlying
areas of Jakarta and is designed to ease traffic congestion in
the capital.
Erna claimed that all of the procedures prior to the deal were
transparent.
"We coordinated this with the House and frankly we couldn't
wait any longer to start the project as we were concerned about
how to provide people with more jobs," she said.
"Again, apart from economic reasons, heavy traffic congestion
and poor road conditions in Jakarta have given us no choice but
to build more roads."
JORR's initial investors, namely PT Citra Mataram Satriamarga
Persada, PT Marga Nurindo Bhakti and PT Citra Bhakti Margatama
Persada, which are linked to former president Soeharto's daughter
Siti "Tutut" Hardijanti Rukmana, managed only to complete 40
percent of the project when the economic crisis struck the
country in mid-1997. The government then suspended the joint
venture.
The remaining 60 percent of the project, at the time of
suspension, was either under construction or in its preparatory
stages.
Left-over projects included construction of roads linking
Pondok Pinang and Kebon Jeruk, Jagorawi toll road and Cikunir,
and Kebun Jeruk and Penjaringan.
The investors were also preparing the construction of the ring
road connecting Cikunir, Cilincing and Tanjung Priok when the
project came to a halt.
The Indonesian Bank Restructuring Agency (IBRA) took over the
three companies' nonperforming loans from nationalized banks, and
along with state toll road operator PT Jasa Marga formed a joint
venture, called New Co., to continue the JORR project. (edt)