'JORR project sill

'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.