Indonesia woos infrastructure investors

Indonesia woos infrastructure investors

MELBOURNE, Australia (AFP): Indonesia wants foreign companies to bid for up to US$11 billion of transport infrastructure development over the next five years, Indonesian Communications Minister Haryanto Dhanutirto said yesterday.

Haryanto, who has special responsibility for non-road infrastructure development, including ports and airports, told a trade conference here his government wanted investment through joint ventures with state-owned companies.

"The patterns of cooperation could be in the forms of joint venture, management contract, or joint operation through either build-operate-transfer or build-operate-own," he said.

Haryanto said the private sector had been playing an important role in developing and maintaining transportation infrastructure in Indonesia.

"For the running of special business activities -- such as special services, special seaports, special airports -- licenses from government are needed and technical guidance will be provided by the Department of Communications."

He cited a five-year development plan known as the Repelita VI, which he said envisaged $17 billion investment in transportation infrastructure.

"It is projected that the government share will account for 14 percent of the total budget and the foreign loan contributes 21 percent, so that the state-owned companies and the national as well as international private sectors will be encouraged to finance 65 percent of the total budget," he said.

Indonesia, with 192 million people and rapid economic growth, has been steadily deregulating its economy including loosening controls on foreign investment two years ago.

It is one of Australia's major trading partners, with Australian exports of $2 billion last year.

Australia is also the seventh largest investor in Indonesia in terms of the number of projects, although investment is still largely concentrated in the mining sector.