Indonesia: Infrastructure Part V – Final

THIS POST WAS ORIGINALLY PUBLISHED NOVEMBER 15, 2009

Indonesia: Infrastructure Part V – Final

According to ADB, projections for 2009 and 2010 assume that the Government will implement major policies outlined during the election campaign, such as fostering infrastructure development and reforming the bureaucracy. The Government plans to support development of infrastructure in 2010 through new tax incentives and expenditure of Rp93.9 trillion ($9.4 billion).

Jakarta Post reports that this month the Government will review a presidential regulation on public-private partnerships (PPP) and a presidential decree on government project procurement rules to ease bottlenecks hampering development. In particular, a new provision to the presidential regulation No 67/2005 on PPP will be added — so that a government private partner can divest its share in an infrastructure project, which it won through a bidding process, to another company. Another major issue to be resolved is the land acquisition. According to Jakarta Post a total of Rp 2,100 trillion (US$222.5 billion) is needed to finance infrastructure projects in the country annually, of which the Government can only provide 15 percent. The other Government estimates are reflected in this Table:

Source:  PRIVATE SECTOR PARTICIPATION IN ASIAN RAILWAYS

Foreign investors show a keen interest in Indonesian Infrastructure. This was confirmed this week by the Chairman of the US Chamber of Commerce Robert S. Milligan: “It seems that the infrastructure sector was the most attractive one. The sector we can develop is, for instance, toll roads.” Also this week Indonesian President discussed in Singapore expansion of Chinese participation in the matter.

One of the key issues in Infrastructure financing is the funding required for its maintenance. This graph shows required sums:

Source: Ministry of Transportation

Within the limits of Internet Blog it is impossible to cover such immense issue –  Infrastructure development n Indonesia. However, in addition to already supplied,  I would like to add more useful links to documents that may be helpful in research on the subject:
First, and the most informative is Public-Private Partnerships. Infrastructure Projects in Indonesia

This is a complete official list of PPP projects for investors

• Infrastructure Development in Indonesia
• INDONESIA INFRASTRUCTURE: BUILDING INDONESIA’S ECONOMIC FUTURE
• Infrastructure PPP in Indonesia
• Australian participation in Infrastructure projects
• AUSTRALIAN INDII
• STRATEGIC INITIATIVES TO ACCELERATE INFRASTRUCTURE DEVELOPMENT IN INDONESIA
• Public Private Partnership on Transportation Infrastructure in Indonesia
• REBUILDING THE INDONESIA INFRASTRUCTURE
• TollRoads Private Sector

This ends my brief survey of Infrastructure projects in Indonesia – of course, it is a small part of all information available – but, in my thinking, gives an idea on this important issue???