Japan likely to be top investor in monorail

Japan likely to be top investor in monorail

Damar Harsanto, The Jakarta Post, Jakarta

The city administration is likely to drop Malaysian firm MTrans
Holding Sdn. Bhd. from the top monorail investor position as it
is eying the possibility of having Japanese firm Hitachi carry
out the project.

"We have given the Malaysian company the chance to comply with
our demands. But, as of today, we have not received any reply. We
simply cannot tolerate the delay," Governor Sutiyoso told
reporters on Wednesday.

He was slated to fly to Japan on Wednesday afternoon on the
invitation of Hitachi to see the monorail project there.

Sutiyoso claimed that the reason for turning to the Japanese
firm was "not a matter of the lower cost (offered by the Japanese
company) but because it is willing to meet our requirements."

Jakarta has demanded the simultaneous construction of two
planned lines in the capital.

The lucrative line, also known as the green line, will
encompass a 14.8-kilometer route serving the city's golden
triangle area of Kuningan, Sudirman and Senayan, with 16
stations. The second one, which is considered less lucrative or
the blue line, will connect a 12.2-kilometer route from Kampung
Melayu in East Jakarta to Roxy in West Jakarta.

Sutiyoso had expressed concern that his administration would
have problems in finding investors for the less lucrative line if
the existing investor was only interested in developing the
profitable line.

The administration signed a Memorandum of Understanding (MOU)
with MTrans Holding over the US$540 million project last year.

In late January, David Chew of the Malaysian firm confirmed
the company's commitment to go ahead with the project but asked
more time to settle both technical and financial problems.

The Indonesia Transit Central (ITC), MTrans Holding's local
partner, chief executive officer Ruslan Diwirjo admitted that his
company still did not know when the Malaysian firm would be ready
to start the project.

"We don't know their financial condition," he told The Jakarta
Post by phone.

Ruslan said the MOU between the administration and the
Malaysian firm was about to expire.

"That's the reason why we and the administration are looking
into other possibilities, comparing the Malaysian firm with
potential investors in the lineup, like Hitachi and Canadian firm
Bombardier," he said.

If the monorail project invites new investors, then the
scheduled kickoff at the end of this year is likely to be delayed
indefinitely.