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Pelindo II OK with foreign role at ports
State-owned seaport operator PT Pelindo II said that it was not worried about a possible influx of overseas competition after the government announced it would open the seaport management sector to foreign investors
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tate-owned seaport operator PT Pelindo II said that it was not worried about a possible influx of overseas competition after the government announced it would open the seaport management sector to foreign investors.
'If you ask my personal opinion, I think this is a good decision,' PT Pelindo II president director Richard Joost Lino said on Tuesday, when asked about the plan to allow foreign investors to own up to a 100-percent share of the seaport management industry.
'If foreign investors are building infrastructure like roads and ports those are assets they can't bring back to their countries ' those assets have to stay here,' he explained. 'So, if the foreigners are the ones building the facilities here, then why not [allow them to oversee the management of them]?'
The government last week revealed several possible changes to the negative investments list (DNI) ' sectors that are partially or wholly closed to foreign investors ' with the most radical revisions being the possibility for foreign investors to own to 100 percent of the airport and seaport management industries.
Currently, such management is closed to foreign investors, as only state-owned operators such as Pelindo and Angkasa Pura are allowed to run airports and seaports.
Previously, locking foreign investors out has at times led to delays in several infrastructure projects ' notably new airports in Yogyakarta and Bali ' as foreign investors had been reluctant to invest if they weren't allowed to be involved in the management.
While some observers have expressed concerns over a larger foreign presence in Indonesia's strategic sectors, Richard argued that the issue of infrastructure development should not be seen from the 'narrow mindset of nationalism'.
'The reason we built this company [Pelindo II] was because we wanted to make everybody ' not just certain people ' happy and rich,' said Richard. 'So more competition is good for the Indonesian people.'
Pelindo II, also known as the Indonesia Port Corporation (IPC), has undergone a significant transformation under Richard's leadership.
The state-owned enterprise reported Rp 1.8 trillion (US$155 million) in net profit in 2012, surging 21 percent compared to a year earlier.
The underdevelopment of Indonesia's infrastructure, such as roads, airports and seaports, has
created inefficiency and stalled the flow of goods throughout the archipelago.
Accordingly, logistics costs in Indonesia are among the highest in the region, accounting for 24 percent of the country's gross domestic product (GDP), official figures show.
To tackle the issue, Pelindo II is now developing the $2.5-billion Kalibaru Port, a mega-project that will become Indonesia's largest port, in the northern area of Jakarta. The port is expected to ease congestion in Tanjung Priok, the country's busiest port, which has been running above capacity for years.
The project, which is shooting for a 2017 completion date, was previously feared to lack the necessary complementary infrastructure ' notably, roads, as well as power and water utilities. Richard, however, was unconcerned.
'I just do my part and after that I'll make noise to the press, telling public works and other public departments to do their jobs,' the Pelindo II CEO said. 'It's a bit of a peculiar strategy, but this is what I do.'
