West Java govt to offer $16b worth of projects

West Java govt to offer $16b worth of projects

Zakki P. Hakim, The Jakarta Post, Jakarta

Although the recent Indonesian Infrastructure Summit has yet to
bear significant results, the West Java administration is set to
hold a similar summit in August to offer some 50 infrastructure
projects worth a staggering Rp 150 trillion (US$15.8 billion).

West Java governor Danny Setiawan said his province actually
needed at least Rp 200 trillion of investment in infrastructure
for its economy to grow by 8 percent in the next five years from
the current rate of around 5 percent.

"We need such growth to cut our unemployment rate and
alleviate poverty in our province," Danny told a press conference
on Thursday.

West Java, home of 39.14 million people, has now 2.4 million
people unemployed and 10 million living under the poverty line.

The province had abundant business opportunities in the areas
of agriculture, marine industries, tourism, manufacturing, trade
and services and human resources, but he said lack of
infrastructure was discouraging investment in these sectors.

Therefore, the West Java Infrastructure Summit, to be held in
Bandung on Aug. 18-19, would offer projects in sectors such as
toll roads, power, airports, seaports, water supply and waste
management.

Aside from holding the summit, the governor would also
undertake a road show promoting the projects to China and
European Union member countries in July.

The projects include building an international airport in
Kalijati subdistrict in Majalengka regency -- about three hours
drive south of the province's capital city of Bandung-- and a
marine harbor in Majalengka's neighboring town of Cirebon.

The Summit would also offer a tap water supply project in
Bandung regency worth Rp 100 billion with a rate of return of 21
percent, as well as similar other water treatment projects in
other locations within the province with an average return of 20
percent.

The governor also said that the province suffered from a
shortage of electricity, having its power supplied from Paiton
Energy in East Java. "We need alternative power supplies in the
province, be it be sourced from coal, water or geothermal," he
said.

He, however, could not give a clear answer on why the province
needed to hold a separate event from the series of summits the
central government conducted.

The central government held the first infrastructure summit in
January offering 91 infrastructure projects worth $22.5 billion
that spanned the archipelago. The government is slated to hold
another summit offering a second batch of projects worth $57.5
billion.

Although the January event was relatively successful in
promoting Indonesia and the projects, foreign investors were
still somewhat reluctant to actually take up the offers.

The general attitude of the participants was that they would
wait and see when the government would fulfill its promise to
enact 11 government regulations and three presidential decrees as
the legal basis for the projects.

Danny said he had pledged together with regents and majors in
the provinces to do their best in facilitating investment in West
Java.

For a start, he vowed that he would slash the time needed to
start a business in the province from 154 days at present, to
only 30 days in accordance with the central government's target.