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gribusiness giant Wilmar Group Indonesia'€™s integrated industrial estate in Serang, Banten, is slated to kick off operations by the end of this year, a top official has said.

Investment Coordinating Board (BKPM) head Franky Sibarani said in a statement issued on Friday that his office had visited the multimillion dollar project to monitor its investment realization and to ensure that no obstacles hampered the process.

'€œI have got an explanation from the management that the industrial estate will be ready for commercial operations by the end of this year,'€ he was quoted by Antara news agency as saying.

Franky said that the project was well supported by the Serang regency and Banten provincial administrations.

The Wilmar Group Indonesia, which is the country'€™s largest palm oil producer and a subsidiary of Singapore-listed Wilmar International, is developing the zone on a piece of land measuring approximately 1,744 hectares, which includes 544 ha of reclamation area for a port and industrial
development.

The integrated industrial estate will have its own power plant with a capacity of 2 x 1,000 Megawatts worth US$2.5 billion, a port with a loading capacity of 30 million tons per year worth $500 million of investment and a railway system. The zone'€™s construction phase cost $130 million worth of investment from the total planned investment of $700 million and has absorbed around 2,000 workers. Currently, the project is entering the port construction phase.

Wilmar Group Indonesia director Erik Tjia said on Friday that his office was in the process of applying for the port construction permit.

'€œWe will finish the project gradually with infrastructure construction as the priority,'€ he said as quoted by kontan.co.id, adding that the port would be focused on facilitating exported goods shipments while the railway would provide access for transporting raw materials and finished products.

Franky further said that he appreciated the industrial zone concept that integrated a port, railway and power plant into its development because the idea could increase production and logistics efficiency and boost the competitiveness of local products in the international market.

'€œMoreover, the zone can be a hub considering its location, which is close to industrial area Serang in Banten, Merak Port and Jakarta,'€ he said, adding that the position provided strategic access for goods distribution.

He said that the investment potential of the industrial zone could reach $10 billion from its infrastructure and companies that planned to build their factories in the industrial area.

The government is pushing investments in industrial and special economic zones (KEK) by preparing various location-based fiscal incentives for the areas, including tax holidays and tax allowances. Currently, the government is working on regulations for incentives for the KEKs, free trade zone and free port (KPBPB), industrial zones, bonded zone (KB) and export destination industry zone (KITE).

The government outlined in the 2015 to 2019 National Mid-Term Development Plan its plan to build 14 industrial zones and 17 new KEKs '€” of which 10 would be tourism KEKs '€” in five years. (prm)