Thu, 27 Sep 2001

'JORR project sill facing uncertainty' ADIANTO P.SIMAMORA The Jakarta Post Jakarta

The tender process for the Jakarta Outer Ring Road (JORR) project continued to be plagued by uncertainty as the administrative court ordered the government to delay the tender.

"We are still facing a legal problem. We are now waiting for the administrative court decision about the JORR project," the chairman of the Indonesian Bank Restructuring Agency (IBRA), I Putu Ary Suta, told reporters on Wednesday.

Ary Suta declined to provide further explanation.

The legal uncertainty emerged after the court recently ruled a delay in the decision of the Ministry of Settlement and Regional Infrastructure to transfer the management of the JORR toll road project to state-owned toll road operator PT Jasa Marga.

The ruling was made after the original investors of the toll project filed a legal suit with the administrative court to protest the ministry's decision.

The administrative court has yet to decide whether to proceed with the case or not.

The 56.87 kilometer toll road project was initially developed by three investors, PT Cakra Bhakti Margatama Persada, PT Citra Mataram Satriamarga Persada and PT Marga Nurindo Bhakti under a build-operate-transfer (BOT) system with Jasa Marga. The three firms are linked to the eldest daughter of former president Soeharto, Siti Hardijanti Rukmana.

The three investors borrowed around Rp 1 trillion (US$105 million) from local banks to finance the project, but after the country was hit by the Asian financial crisis in the middle of 1997, the project was canceled and investors were unable to repay the banks.

The Indonesian Bank Restructuring Agency (IBRA) then took over the loans and the project. IBRA then teamed up with Jasa Marga to set up a new company called PT Jalantollingkar Luar Jakarta (JLJ) to proceed with the project and find new investors.

IBRA named a Malaysian consortium as a preferred bidder in March 2001, but the latter canceled its interest.

The government and IBRA were supposed to reopen the tender for the project late in August, but it was canceled due to legal uncertainty.

Meanwhile, Legislator Erwin Pardede expressed concerned about the delay in the tender of the JORR project.

"The delay will only discourage foreign investors from the country," Edwin said.

He added that the government must reject any proposal from old investors of the project.

"I don't agree with any plans to allow old investors to participate in the bidding," he said.