Investors agree to reduce value of 'marked up' roads
Investors agree to reduce value of 'marked up' roads
YOGYAKARTA (JP): Investors in 21 troubled toll road projects
have agreed to lessen the projects values and shorten the
concession periods following allegations that the contracts were
obtained from the government through corruption, collusion and
nepotism.
Minister of Public Works Rachmadi Bambang Sumadhijo said on
Saturday that several conditions of the contracts had to be
renegotiated because the investment values of the toll road
projects were allegedly marked up.
"The renegotiation process is still ongoing, but the investors
have principally agreed to reduce the investment values to
reasonable levels," he told reporters following the signing of a
cooperation agreement between the Ministry of Public Works and
the University of Gadjah Mada.
Rachamadi, however, declined to give the amounts of the
investment revaluations or the new periods of concessions.
He only said that details of the contract renegotiations would
be provided after the process had been completed.
He explained that allegations of corruption, collusion and
nepotism in obtaining toll road projects were still being
investigated by the Attorney General's Office.
He declined to provide more details.
The 21 toll road projects are either in operation, under
construction or in the stage of land acquisition.
Among the contracts set for revaluation and renegotiation are
the lucrative intra-Jakarta toll road projects under former
president Soeharto's daughter Siti Hardiyanti Rukmana.
Many of the country's toll road projects were awarded to
Soeharto's family and close friends under the build, operate and
transfer mechanism.
The government has canceled many toll road projects not only
because of allegations that they were unlawfully awarded, but
also due to the 18-month old economic crisis.
Most of the canceled projects were still in feasibility
planning stages.
The government is expected to raise and restructure the toll
tariff once the sector is cleared of charges of corruption,
collusion and nepotism in a bid to attract foreign investors to
road infrastructure projects, seen as an important factor in the
economy's recovery. (44/rei)