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Jokowi leadership boosts private role in infrastructure
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A ship discharges cargo at Bitung Cargo Port in North Sulawesi on Oct. 10. The government wants to turn the port into an international hub seaport (IHSP) to promote trade in eastern Indonesia. (Antara/Adwit B Pramono)
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mproving basic infrastructure has become a top priority for the administration of President Joko "Jokowi" Widodo and Vice President Jusuf Kalla in its attempt to boost efficiency in logistics and improve the country's competitiveness.
After two years, the Jokowi administration has taken several measures to accelerate infrastructure development, including a sharp increase in government investment in strategic projects and deregulation to simplify licensing procedures that had hampered progress.
However, the government has acknowledged that it is not easy to realize this dream, due to a lack of funding. To that end, the government has shifted financing schemes to no longer depend primarily on the state budget, but instead involve domestic and foreign companies in public-private partnerships (PPP).
National Development Planning Board (Bappenas) head Bambang Brodjonegoro recently said this was the new scheme for infrastructure funding in the future.
"At least the government has already laid the foundation; [the next task is] to get PPP projects going," Bambang said, adding that some current infrastructure projects were already running under the PPP scheme, such as the mega power plant in Batang, Central Java.
The government has provided numerous incentives to attract investors, such as viability gap funding, and availability payment.
To cut transportation and logistics costs and reduce economic disparity between Java and the rest of the country, the government has set up 101 projects under the theme of connectivity, including projects for 52 toll roads, 17 airports, 13 seaports and 19 railway links. (evi)
