Nethy Dharma Somba, The Jakarta Post, Jayapura
Two Chinese companies have signed an agreement that could see them invest millions of dollars in the airport and seaport in Biak regency, Papua.
A memorandum of understanding on the investments was signed by Papua Governor Bas Suebu and representatives of the two companies during a visit by Suebu to China last week.
Under the agreement, China National Property Administration Council and Qili Holdings will spend US$130 million in the first stage of the investment plan and another $800 million in the second stage.
Suebu said Monday the money would be used to improve facilities at Biak's airport and seaport, as part of a plan to turn the regency into the main center for trade, investment and tourism in Papua.
""The $130 million will be channeled in the form of equity venture investment and the $800 million in loans,"" the governor said.
Suebu said the money would be spent on improving existing facilities at both the airport and seaport in Biak. The seaport, for example, will be equipped with new equipment for processing fish and a container terminal for both domestic and international trade, he said.
""As part of the renovation project, the airport will be designed to accommodate wide-bodied airplanes from overseas,"" the governor said. He added that the area around the airport would be developed in stages into a bonded zone with an export processing area.
Suebu said his administration would also begin courting investors for other areas, including plantations.
The governor said representatives of the two Chinese companies were scheduled to visit Papua by the end of this month. ""They will make a survey of the location.""
Suebu also said his administration would begin courting investors for other areas, including plantations. The provincial administration will provide some kind of incentives for investors, he added.
""We will work out of a regional regulation on customary land and provide skilled labor to attract investors to come to Papua,"" he said.
The director of the Papua chapter of the Institute for a Strong Civil Society, Budi Setyanto, warned that Suebu was courting investment before putting the necessary regulatory framework in place.
Budi said clear regulations were needed on the obligations of investors toward locals.
""Papua is in need of investors to tap its natural resources, but ... regulations have to be created first before we invite the investment,"" he said.
Budi said there was no rush to secure foreign investment because the special autonomy funds from the central government were sufficient to improve the people's economy. He added that the current focus should be on improving the management of existing funds.
The governor also must involve the Papua Legislative Council and the Papua People's Assembly in its investment deals, because these two institutions could reject any agreements, he said.
