Jakarta New Port built to boost 'competitiveness'

Damar Harsanto, Jakarta

Jakarta Governor Sutiyoso claimed that Jakarta New Port in East Ancol, North Jakarta, would not affect the operations of two container terminals in the adjacent Tanjung Priok Harbor.

"The reason we are building the new port is to boost competitiveness between both ports. The Tanjung Priok operator charges high fees, but the vessels queue for days," he said on Thursday.

Sutiyoso, who officiated the groundbreaking ceremony of the new port on Tuesday, said the construction of the port was necessary to compete with other ports in the region, following the establishment of the ASEAN Free Trade Area in 2003.

The city administration will secure 5 percent of shares in the new US$500 million commercial port.

The new port will be built by local developer PT Marindo Bahtera Development in cooperation with the administration and the Indonesian Navy's Western Fleet. The construction of the new port will be completed in six years, it should be operational in 2010.

However, the project has been opposed by state-owned port operator PT Pelabuhan Indonesia II (Pelindo II), which argues that the site of the new port belongs to the company.

"The project will be built on a 500-hectare site that we have prepared for the construction of an integrated terminal since four years ago. It is slated to be operational in 2012," said Pelindo II spokesman Hendra Budhi.

He said Pelindo II and partner PT Manggala Krida Yudha had reclaimed some 15 hectares of land in East Ancol and would proceed with reclaiming another 40 hectares this year.

"Why did the administration not talk about its plan with us?" Hendra said.

Pelindo II director of marketing and business development Soepadi said his company would seek clarification from the central government and the city administration over the project.

Despite the protest, Sutiyoso insisted that the new port project was in line with Law No. 34/1999 on the authority of the city administration.

"The law stipulates that the Jakarta administration has the authority to manage its own seaport, thus the project complies with the law," he said.

Article 31 of the law states that the administration has authority over special areas, including seaports, airports, forested areas, industrial compounds, tourist destinations, toll roads and islands.