Tue, 05 Aug 2003

Infrastructure development on the up this year

Evi Mariani, The Jakarta Post, Jakarta

The National Association of Indonesian Consultants (Inkindo) sees a rebound in the development of infrastructure projects in the country this year after the government announced plans to revive a number of stalled projects.

"I think this year is the beginning of the infrastructure rebound," Inkindo president Kristiya Kartika told a press conference on Monday.

He estimated that the infrastructure projects launched this year were worth around Rp 106.63 trillion (US$12.5 billion), compared to last year's figure of Rp 87.77 trillion.

He predicted that the value of the projects to be launched next year would increase by around 5 percent.

Last month, the government announced it would revive some infrastructure projects that were halted after the late 1990s economic crisis, including three toll road projects in East Java worth a total of Rp 4.92 trillion; the East Canal flood-control project in Jakarta worth Rp 4.12 trillion; the Suramadu bridge project connecting Surabaya and Madura island worth Rp 2.8 trillion, and the resumption of the Tanjung Jati B power plant in Central Java worth more than $1.65 billion.

Kristiya said that most of the infrastructure projects were linked to the transportation sector.

He said that usually Inkindo members handled more than 25 percent of total project value. For example, this year Inkindo expected to handle projects worth more than Rp 25 trillion.

Inkindo has a membership made up of more than 5,400 consultancy firms, of which 80 percent are involved in the construction sector, he added.

Inkindo has been appointed as the host of the 2003 Technical Consultancy Development Program for Asia and the Pacific (TCDPAP) Conference, which will be held from Sept. 24 to Sept. 25, 2003, in Bali. The theme of this year's conference is: "Infrastructure Development and Globalization: The Role of Consultants in Developing Countries".

The objectives of the conference are, among other things, to upgrade technical, technological and managerial expertise in dealing with national projects, and to provide opportunities for effective discussion, and exchanges of views and experiences.

The resumption of a number of stalled projects has been possible amid growing confidence in the country's economy, particularly following the return of stability in macroeconomic indicators such as the rapid appreciation of the rupiah, benign inflationary environment, and lower interest rates.

Improving the country's infrastructure sector is among the conditions demanded by foreign investors to allow them to make fresh investments, something that is crucial if the country wants to push economic growth to the pre-crisis level of around 6 percent and provide sufficient jobs for the millions of unemployed.