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Regional Autonomy: Strategically-located Musi Rawas lures investors

South Sumatra's Musi Rawas regency is poised to take advantage of its strategic location and wealth of natural resources by inviting investors to look at the prospects of the area

Khairul Saleh, (The Jakarta Post)
Muara Beliti
Mon, January 5, 2009

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Regional Autonomy: Strategically-located Musi Rawas lures investors

South Sumatra's Musi Rawas regency is poised to take advantage of its strategic location and wealth of natural resources by inviting investors to look at the prospects of the area.

The regency spans 1,236 million square meters and is home to nearly half a million people, scattered throughout 21 districts and 261 villages. It borders with Bengkulu province and is the second largest regency in South Sumatra after Musi Banyuasin.

As it lies along the central Trans-Sumatra highway, the overland route from Bakauheni in Lampung to Banda Aceh, Musi Rawas bustles with activity, serving as a transit hub for people traveling from major cities in Sumatra and Java.

The regency's wealth of natural resources, especially agricultural and mining reserves, is so immense it has prompted the Musi Rawas administration to embark on the Agropolitan Program to encourage development, which will affect five districts and be concentrated in regency capital Muara Beliti.

Musi Rawas Regent Ridwan Mukti declared that development based on agriculture would be most suitable for the region because almost 70 percent of its people depend on it for a living.

"The agropolitan concept is intended to, first of all, make Musi Rawas sufficient in agricultural and plantation products; and secondly, to support the provincial administration's national food center program. This is aimed at resolving some of the area's fundamental issues, such as poverty," Ridwan said in Muara Beliti recently.

Musi Rawas produces five prime commodities -- rubber, palm oil, rice, fishery and forest products.

At 220,000 hectares, community owned rubber farms comprise the largest rubber plantation area in south Sumatra. This will soon be increased to 250,000 hectares, followed by 30,000 hactares of privately owned plantations.

The combined area of privately owned oil palm estates now stretches over 110,000 hectares, with an additional 20,000 hectares of plasma, or community owned farms.

Rice cultivation in Musi Rawas has been aided by a tried and true irrigation system put in place by the Dutch colonial administration; but efforts to build two new irrigation systems -- the Lakitan and Air Rawas -- are now underway.

Thanks to the irrigation system, a number of other prime industries, such as a rapid water fishery, are thriving. They are not only able to meet local demand but also supply other areas including Bengkulu and Palembang.

Musi Rawas is also blessed with an abundance of forest-based commodities, or Industrial Forest Products (HTI), such as Acadia trees, which supply the Tanjung Enim Lestari pulp mill in Tanjung Enim, Muara Enim regency.

Ridwan said that, given its wealth of natural resources, not to mention its position on the main transportation route and the available gas and oil pipelines, railway lines and airport, the regency was poised to become a major industrial area.

"Every resource is available here, from gold and coal to gas. I'm confident Musi Rawas can excel as the "Fascination of Sumatra," he added.

In an effort to draw investors, the regency administration will provide facilities including a one-day licensing service.

It is also ready to work together with investors in infrastructure building, a task Ridwan said would turn Musi Rawas into a gateway for investments in the province's west.

To achieve this goal, the regency has initiated a number of construction projects including an airport, three power plants and agricultural infrastructure, as well as a mass transportation system. A railway network from Musi Rawas to the Tanjung Api-Api port in Palembang as well as Bengkulu will be able to carry the regency's commodities to destinations further afield. Funding will be sourced from the central government and the private sector.

Given its abundant coal supply, the regency will build three power plants with the involvement of local and foreign investors.

"We are still waiting for the Java-Sumatra undersea cable project to be completed so we can sell power to meet demand in Java and Bali," Ridwan said.

The administration has also extended the runway of the Silampari Airport from 900 meters to 1,300 meters and can already serve medium-body planes, such as the Fokker. Next year it will further extend the runway to 2,000 meters long and 30 meters wide to accommodate larger planes.

The regency's economic growth has risen from 5 percent to 8.36 percent over the past three years, and is now the highest in Sumatra.

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