Restart of some projects 'will not undermine reform'
Restart of some projects 'will not undermine reform'
JAKARTA (JP): The government said yesterday the resumption of
projects previously postponed or reviewed would not undermine
governmental efforts to tackle the currency crisis.
State Minister of National Development Planning Ginandjar
Kartasasmita said yesterday the projects that were resumed were
mostly ones which were already underway or those with rupiah
financing.
"Just look at all those toll road projects, almost all of them
use domestic financing," Ginandjar said.
Revived toll road projects include the Semarang Section C toll
road, the Ujungpandang toll road, the Pondok Aren-Serpong toll
road and the Aloha Waru-Tanjung Perak toll road.
President Soeharto, through Presidential Decree No. 47 dated
Nov. 1, ordered 15 projects -- eight power plants, four toll
roads, one airport, one building and one equipment-provision
project -- to continue.
Eight of the projects had been put under review, while the
remaining seven projects had been postponed under Presidential
Decree No. 39 dated Sept. 20.
Loans
Presidential Decree No. 39 postponed and put under review some
US$37 billion worth the infrastructure projects financed with
foreign loans to cope with the rupiah's sharp depreciation
against the U.S. dollar.
Ginandjar said the President had instructed his team to review
the list of postponed projects or projects under review once
every three months.
"We'll basically allow projects which are already 50 percent
complete or those which do not use foreign loans to continue,"
Ginandjar said.
The revival of the projects was triggered by the recent fatal
crash of a Garuda Indonesia airplane near Medan, North Sumatra,
which forced the government to revive the previously postponed
airport project to replace Polonia Airport in Medan.
"We asked the Ministry of Transportation to continue the
airport project because the route approaching Polonia Airport is
quite dangerous," Ginandjar said.
The new airport project is being developed by PT Citra
Lamtorogung Persada, owned by the President's daughter Siti
Hardiyanti Rukmana.
On the resumption of some big power projects, Ginandjar said
developers had already secured financing, so there was no reason
to delay them.
He said the revival of the controversial Tanjung Jati C power
project in Jepara, Central Java, was based on the fact that its
benefits were difficult to ignore. The same reason was given for
the Tanjung Jati A project, also in Central Java.
"I think Tanjung Jati A and C will continue, because they are
beneficial, but not Tanjung Jati B," Ginandjar said.
The 1,320 megawatt coal-fired Tanjung Jati C power project
worth $1.98 billion was awarded to Consolidated Electric Power
Asia.
The 1,320-megawatt coal-fired Tanjung Jati A power plant was
given to a consortium consisting of the President's daughter Siti
Hediati Prabowo and the Bakrie Group
Other power projects licensed to continue are the 330-megawatt
Sarulla geothermal power project in North Sumatra, owned by a
consortium consisting of the United States' Unocal Corp and the
Nusamba Group; and the 55-megawatt Patuha geothermal power plant
in West Java controlled by a consortium led by California Energy
of the U.S.
The other power projects are the Karaha geothermal power
plant, Unit 1 and Unit 2 of the Drajat geothermal power plant,
the Asahan I hydropower plant, and the Palembang Timur combined-
cycle power plant in South Sumatra, which is being financed by PT
Astra International.
The government also decided to continue a small project to
improve the Meteorology and Geophysics Agency's equipment,
financed by export credit. (imn/rid)