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Public to be offered LRT construction bonds, Ahok says
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Stay firm -- Jakarta Governor Basuki “Ahok” Tjahaja Purnama arrives at the Jakarta Corruption Court to testify as a witness in a graft case related to the uninterruptible power supply (UPS) procurement in Jakarta on Feb.4. (thejakartapost.com/Wienda Parwitasari)
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akarta governor Basuki “Ahok” Tjahaja Purnama plans to involve the public in funding the construction of Light Rail Transit (LRT) system through a municipal obligation scheme, so the project will not be a burden on the regional budget.
Ahok said the LRT construction was a mega project that needed a lot of money.
He said although the administration had provided a Rp 4.4 billion (US$332,075.48) capital injection to city-owned developer PT Jakarta Propertindo (Jakpro), the first phase of the LRT construction would cost between Rp 4.5 billion and Rp 5 billion.
Therefore, Ahok said, Jakpro should also take out bank loans. The administration would also issue bonds to fund the project so LRT would be operational for the 2018 Asian Games, the governor said.
“I want to be something like the Chief Executive Officer (CEO) in Jakarta, so people will have shares in the LRT project by buying municipal obligations from us,” Ahok said on Tuesday.
Although the governor still has not set the value of obligations that will be issued, he is sure that the bonds will be lucrative, especially when the administration buys them back with interest.
The Financial Services Authority (OJK) is currently conducting the review of the issuance of Jakarta municipal bonds. A private auditor is also involved in reviewing the municipal bond issuance plan.
Ahok hopes Jakarta will become a role model, with a successful issuance of municipal bonds to fund infrastructure development.
Jakpro plans to officially break ground on the project on June 22: the city’s 489th anniversary. The first phase of the LRT construction spans 6 kilometers from Kelapa Gading in North Jakarta to the Velodrome in East Jakarta. (ebf)
