PAM Jaya to cooperate with private firms

JAKARTA (JP): The city water company, PAM Jaya, has given assurances that the firm's cooperation with private companies would not have adverse financial effects on the public.

The director of the company, Syamsu Romli, said on Wednesday that agreements to be signed between his company and private companies will state explicitly that the city administration retains exclusive authority to determine the price of tap water.

"The city administration will determine the price of tap water and I can assure you that it will be affordable to all Jakartans," Syamsu said.

He disclosed that PAM Jaya will sign a memorandum of understanding with the Salim Group, owned by conglomerate Liem Sioe Liong, and PT Kekar Plastindo, owned by President Soeharto's eldest son Sigit Harjojudanto, in the near future.

The cooperation is aimed at improving the company's services in providing tap water to Jakartans by reducing the level of water leakages and expanding tap water distribution.

He added that the cooperation would have other advantages, such as greater revenue for the company, larger water networks and better services.

He said that under the agreements the two private companies will be obliged to build water pipe installations to expand tap water distribution and to build water installation centers.

"The private companies will also be involved at the management level," Syamsu said, adding that PAM Jaya will repay the investment later through rates paid by customers.

The cooperation includes the construction of a 70-kilometer water distribution network linking Jatiluhur dam and Jakarta.

Currently, water comes to the centers from rivers, which has resulted in pollution as well as water leakages, which take 45.13 percent of the company's total production of 12.235 liters per second.

Assistant to City Secretary Prawoto Danoemihardjo said on Tuesday that, by installing the new water pipes, the level of the leakages is expected to drop to 30 percent.

Prawoto said that tap water leakages are also caused by old water pipes, which will be replaced by new ones.

Recently, PT Kekar Plastindo signed a memorandum of understanding with PAM Jaya, Thames Water International from Britain and the state-owned Jatiluhur Dam Authority company to conduct the water project, which is worth over Rp 1 trillion (approximately US$457 million).

The project is expected to supply drinking water to about 80 percent of the city's population by the year 2005.

At the moment the water company can only serve 41 percent of the current population of eight million. (yns)