Jakarta Monorail warned for sluggish progress
Jakarta Monorail warned for sluggish progress
Bambang Nurbianto, The Jakarta Post, Jakarta
Governor Sutiyoso chided PT Jakarta Monorail (JM) on Monday over
its sluggish progress in the construction of two monorail lines
in the capital, which are scheduled to be completed in the middle
of 2007.
He said JM should immediately complete its financial closing
by securing investors or face termination of its agreement with
the city administration.
"PT Jakarta Monorail has promised that the financing of the
two lines of the monorail construction would be concluded in
September, but until now we have not received any report about
the progress," Sutiyoso said on Monday.
"We have ordered the city secretary to send a 'love' (warning)
letter to the company so that it can immediately complete the
financial closing. Otherwise, we will find other companies to
build the monorail in the city."
According to JM director Sukmawaty Syukur, the company was in
the final stages of the financial closing. She added that JM
would report the progress to the governor on Wednesday.
Sukmawaty said JM would carry out a shareholders meeting on
Friday to try to end the internal rift between its supporting
companies -- PT Indonesia Transit Central (ITC) and Omnico
Singapore, Pte. Ltd.
ITC owns 55 percent of JM shares, while Omnico owns the
remaining 45 percent.
According to her, several local and foreign financial
institutions had expressed interest in financing the monorail
project, but she added that further process could not be made as
long as JM could not resolve its internal problems.
The rift between ITC and Omnico was sparked by the assignment
of the Indonesia Consortium of Monorail Industries (ICMI) by ITC
as a rolling stock supplier for the project, which was rejected
by Omnico, which preferred to assign South Korea's Rotem.
ICMI is supported by Bukaka Group, whose shares are partly
owned by the family of Vice President Jusuf Kalla, Madiun-based
state rolling stock maker PT INKA and Bandung-based state
electronics firm PT LEN Industry.
It is also supported by Hong Kong-based Mass Transit Railway
Cooperation. The consortium submitted a proposal estimate of $496
million for the project.
Meanwhile, Rotem's Maglev technology would cost $540 million,
excluding bank and consultants' fees, which the ITC claims would
bring the total investment to $826 million.
Sukmawaty said Friday's meeting would, among others, decide
whether Omnico would still stay with JM by increasing its shares
to or leave JM to be replaced by another company.
JM and the administration had previously terminated a contract
valued at $540 million for the same project with a Malaysian
company, MTrans Holding Bhd, due to financing problems.
The monorail project was started in June last year and was
projected to finish in 2007.
When up and running, the monorail will cater to transportation
needs in the prime business areas of the city through a 14.3-
kilometer line as well as a 13.5-kilometer line from Kampung
Melayu in East Jakarta to Taman Anggrek Mall in West Jakarta.
Bambang Nurbianto, The Jakarta Post, Jakarta
Governor Sutiyoso chided PT Jakarta Monorail (JM) on Monday over
its sluggish progress in the construction of two monorail lines
in the capital, which are scheduled to be completed in the middle
of 2007.
He said JM should immediately complete its financial closing
by securing investors or face termination of its agreement with
the city administration.
"PT Jakarta Monorail has promised that the financing of the
two lines of the monorail construction would be concluded in
September, but until now we have not received any report about
the progress," Sutiyoso said on Monday.
"We have ordered the city secretary to send a 'love' (warning)
letter to the company so that it can immediately complete the
financial closing. Otherwise, we will find other companies to
build the monorail in the city."
According to JM director Sukmawaty Syukur, the company was in
the final stages of the financial closing. She added that JM
would report the progress to the governor on Wednesday.
Sukmawaty said JM would carry out a shareholders meeting on
Friday to try to end the internal rift between its supporting
companies -- PT Indonesia Transit Central (ITC) and Omnico
Singapore, Pte. Ltd.
ITC owns 55 percent of JM shares, while Omnico owns the
remaining 45 percent.
According to her, several local and foreign financial
institutions had expressed interest in financing the monorail
project, but she added that further process could not be made as
long as JM could not resolve its internal problems.
The rift between ITC and Omnico was sparked by the assignment
of the Indonesia Consortium of Monorail Industries (ICMI) by ITC
as a rolling stock supplier for the project, which was rejected
by Omnico, which preferred to assign South Korea's Rotem.
ICMI is supported by Bukaka Group, whose shares are partly
owned by the family of Vice President Jusuf Kalla, Madiun-based
state rolling stock maker PT INKA and Bandung-based state
electronics firm PT LEN Industry.
It is also supported by Hong Kong-based Mass Transit Railway
Cooperation. The consortium submitted a proposal estimate of $496
million for the project.
Meanwhile, Rotem's Maglev technology would cost $540 million,
excluding bank and consultants' fees, which the ITC claims would
bring the total investment to $826 million.
Sukmawaty said Friday's meeting would, among others, decide
whether Omnico would still stay with JM by increasing its shares
to or leave JM to be replaced by another company.
JM and the administration had previously terminated a contract
valued at $540 million for the same project with a Malaysian
company, MTrans Holding Bhd, due to financing problems.
The monorail project was started in June last year and was
projected to finish in 2007.
When up and running, the monorail will cater to transportation
needs in the prime business areas of the city through a 14.3-
kilometer line as well as a 13.5-kilometer line from Kampung
Melayu in East Jakarta to Taman Anggrek Mall in West Jakarta.