T

he Indonesian Chamber of Commerce and Industry'€™s (Kadin) Jakarta branch has urged the city administration to optimize its budget spending this year after slow spending last year affected business.

Kadin Jakarta chairman Eddy Kuntadi said during a discussion on Jakarta'€™s economic outlook recently that it was important for the city administration to optimize budget spending, especially when related to infrastructure projects.

'€œThe positive economic growth of exporting countries will have a good effect on export activities in Jakarta. We will also have a new port in Kalibaru that will increase our export capacity,'€ he said.

He said, however, that it would not run as expected if infrastructure projects like roads, railway tracks and flood mitigation connecting the city and the port were not improved.

'€œOur logistics costs are the highest among [Southeast Asian] countries, which is around 26 percent of the total cost. Better transportation infrastructure will reduce costs,'€ he said, adding that it would not happen if the city administration did not build anything.

Eddy said both the city administration and the central government should also improve their coordination, so the projects could be completed faster.

The city administration spent 59 percent of its city budget of Rp 72.9 trillion (US$5.75 billion) last year. Many big transportation and flood mitigation projects like toll road construction, road maintenance, public bus procurement and river dredging were halted.

One reason for the slow spending is the introduction of a new procurement system, where a procurement body '€” the Goods and Services Procurement Agency (ULP) '€” handles almost all procurements previously carried out by city agencies.

Kadin Jakarta deputy chairman Sarman Simanjorang said he also urged the city administration to revamp its bidding system at the ULP.

'€œThe administration barely conducted infrastructure projects last year, affecting economic growth in the capital,'€ he said, adding that many business owners did not receive any projects from the city administration.

Sarman said most of the budget was used for routine spending, for civil-servant salaries and maintenance costs.

He hoped the city administration could revamp the bidding process, so budget spending could be optimized.

'€œThe administration needs to increase the number of ULP'€™s personnel and train them as well as upgrade its technology information infrastructure,'€ he said.

At one point last year, the bidding process was halted for a month because of server problems.

Sarman said the personnel should have uniform knowledge regarding the bidding process.

'€œThey need to familiarize and conduct a simulation for bidding participants,'€ he said.

Further, Sarman said he hoped the city administration could ensure the professionalism of the One-Stop Integrated Services (PTSP).

'€œThe front officers should understand all the requirements and the nature of the permits,'€ he said.

Economist Didik J. Rachbini, one of the speakers in the discussion, said the challenges for business entities in Jakarta were the same as those faced by businesspeople in other provinces. They included corruption, lacking access to credit, inflation, inefficient bureaucracy and inadequate infrastructure.

He said, meanwhile, that Jakartans always complained about three things: traffic, flood and unemployment. '€œThese three things have not changed for many years,'€ he said.

Didik said they represented the ultimate challenges of the city, so private entities should also help the city administration in overcoming the problems.