I

ndonesia Infrastructure Finance (IIF) will focus this year on financing telecommunications infrastructure projects, the construction of power plants based on renewable energy and seaports, a top executive has said.

'€œThe projects include the long-delayed development of the fiber-optic network Palapa Ring, re-scheduled to start construction this year, five hydro power plants and seaports for PT Pelindo I and PT Pelindo IV,'€ IIF president director Sukatmo Padmosukarso said Friday.

Sukatmo said that the company chose to finance telecommunications infrastructure because regulations regarding construction were already quite clear and would guarantee development.

The Palapa Ring project, aimed to improve the country'€™s telecommunications signal by setting up 50,000 kilometers of fiber-optic cable across the archipelago, was originally scheduled to begin construction in 2007 but was delayed for various reasons.

The seaports and hydro power plants are also in focus as part of IIF'€™s desire to support the government'€™s infrastructure acceleration projects into 2019.

'€œFor power plants, we only strictly support those fired by new, renewable and clean energy. Clean energy includes gas and coal but with super critical technology. This is the mandate from our shareholders,'€ he said.

A majority or 30 percent of IIF shares are owned by the government, 20 percent by the World Bank'€™s International Finance Corporation (IFC), 20 percent by the Asian Development Bank (ADB), 15 percent by German investment corporation DEG and 15 percent by Sumitomo Mitsui Banking Corporation.

He went on to say that committed loans and bonds for this year'€™s projects reached Rp 4.1 trillion (US$295 million). Out of which, Rp 1 trillion came from loans from state lender Bank Mandiri, $250 million from IFC and a banking syndicate comprising 14 foreign commercial banks and $100 million from ADB.

Last year, the financing company committed around Rp 4 trillion to development. Since its active lending period in 2012, the firm has disbursed Rp 4.5 trillion in funding, including funding for the newly opened Cipali toll road in Subang, West Java, the 180 megawatt (MW) Asahan River hydro-electricity plant in North Sumatra and the 2 Mw solar power plant in Gorontalo.

Sukatmo said that the firm was open to funding of more environmentally-friendly plants as more and more companies were eager to contribute to building such plants.

Earlier on Wednesday, power solution provider PT Sumberdaya Sewatama (Sewatama) received Rp 300 billion (US$21.6 million) in loans from the IFF for the construction of four mini hydropower plants in South Sulawesi this year.

'€œFive years from now, we want to use more resilient energy to fire our power plants. At least 30 percent of our portfolio will be new and renewable energy,'€ said Sewatama president director Elan B. Fuadi.

The company does not presently use renewable energy.

By 2019, the state aims to generate an additional 35,000 MW of power. 8,000 MW of power has been allocated for new and renewable energy sources. (rbk)