Govt to review 50 toll road projects

JAKARTA (JP): State-owned toll road operator PT Jasa Marga announced on Monday it would review 50 toll road projects to determine whether private firms had obtained contracts due to preferential treatment.

Jasa Marga president Maryadi Darmokumoro said 10 of the toll roads were already operational, 13 were currently either under construction or in the process of acquiring land, while the remaining 27 projects were still in the planning stage.

"We have indications that many of the contracts were obtained through corrupt, collusive and nepotistic practices, though this hasn't been proven, because most of the deals were made through direct appointment instead of fair bidding," Maryadi said.

The company plans to review the deals for potential contingent liabilities, including clauses that require Jasa Marga to take over debts from its partners or provide bridging finances to them.

Jasa Marga will also look for indications of markups and unfair distribution of revenue in projects with large investments.

The review's results, he said, could prompt the company to renegotiate agreements with some of its partners.

But Maryadi assured that the company would not unilaterally pull out of any contracts, adding that any cancellations would be done according to existing rules.

Jasa Marga will also take into consideration any possible effects of the cancellations on the investment climate for toll roads and investment in general.

Projects not yet underway or in their planning stage will be offered for tender again by the company, he said.

On Sept. 2, the government reviewed and annulled several business deals signed by its agencies and enterprises with the family and cronies of former president Soeharto.

Maryadi said all of the 27 projects currently in the planning stage had been obtained through political connections.

He refused to name the companies which had allegedly used political ties to score the deals, but many of the projects listed were linked to Soeharto's family.

At least five of the projects are known to be controlled by Soeharto's eldest daughter, Siti "Tutut" Hardijanti Rukmana.

Publicly listed PT Citra Marga Nusaphala Persada, headed by Tutut, holds a 30-year construction and operation contract over the Cawang-Tanjung Priok toll road through 2019 and over the Tanjung Priok-Jembatan Tiga toll road through 2025. Both are currently in operation.

Other toll road projects linked to Tutut -- the Pondok Aren- Serpong project in Tangerang, West Java; Jakarta's triple-tiered project; the Solo-Yogyakarta road in Central Java; and the Waru (Aloha) Wonokromo-Tanjung Perak toll road in Surabaya, East Java -- will also be looked at in the review.

The projects, except for the Pondok Aren-Serpong road which is under construction, are currently in their planning phases.

A toll bridge planned for the Sunda Strait, a project linked to Soeharto's young grandson Ari Sigit, is also among the 50 projects to be reviewed. Though it has yet to begin, the project has already gained approval from the Ministry of Public Works.

Other projects already in operation to be reviewed are the Tangerang-Merak toll road in West Java, the Surabaya-Gresik road in East Java, the Ujungpandang toll roads in South Sulawesi and the Semarang section C toll road in Central Java.

Projects to be reviewed that are still under construction are the Jakarta outer ring roads, the Surabaya-Mojokerto project in East Java and the Semarang-Demak road in Central Java.

Projects yet to begin that will be reviewed include a Surabaya-Madura toll bridge, a Bali strait toll bridge and a Kapuk-Teluk Naga-Tangerang toll road. (das)