Monorail firm demands city secure loans

The Jakarta Post, Jakarta

While insisting that it faces no financial difficulties in pursuing the ambitious monorail project, PT Jakarta Monorail is urging the city administration to issue a guarantee it needs to secure bank loans for the undertaking.

PT Jakarta Monorail (JM) director Sukmawaty Syukur demanded The Jakarta Post on Tuesday the city administration honor its obligations stated in a contract signed last year, including a guarantee to cover any financial shortfalls and repay the company's debts to banks.

Sukmawaty said the city had yet to meet its obligations stipulated in the contract, but refused to reveal the full content of the agreement.

It is understood JM has also asked the administration to provide it with an annual subsidy worth US$20 million (Rp 185 billion) for a period of up to eight years.

A source familiar with the project said that JM had also asked to be permitted to implement the Electronic Road Pricing (ERP) system, which would charge cars passing along the monorail's routes.

"We are still negotiating with the administration about several items in the agreement," Sukmawaty said.

The guarantee, subsidy and ERP, according to Sukmawaty, were just some of requirements needed to secure bank loans to finance the $650 million project.

Earlier, the company urged the city administration to provide at least $60 million for the project to convince banks that it was serious about the endeavor.

"So, it is not true that our demand for share equity is due to our financial difficulties. We only want a strong commitment from the administration to the project," she said.

JM, owned by PT Indonesia Transit Central (ITC) and Omnico Singapore, Pte. Ltd, has been appointed to build two monorail lines totaling 27.8 kilometers in the capital.

The first, 14.3-kilometer green monorail line is designed to pass along Taman Rasuna, Gatot Subroto, Satria Mandala, the city police headquarters, Sudirman Central Business District, Bung Karno sport complex, Pal Merah, Pejompongan, Dukuh Atas railway station, Setia Budi Utara, and central Kuningan.

The second, 13.5-kilometer blue line runs from Kampung Melayu bus station in East Jakarta to Taman Anggrek.

However, the project has made little progress since the initial groundbreaking ceremony on Jl. Asia-Africa, Central Jakarta, witnessed by then president Megawati Soekarnoputri.