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Jakarta Post

Jokowi gives nod to final batch of marquee projects

  • News Desk

    The Jakarta Post

Jakarta   /   Thu, May 4, 2017   /   09:00 am
Jokowi gives nod to final batch of marquee projects President Joko “Jokowi” Widodo (second left) receives the Supreme Audit Agency's 2016 second-half report at the State Palace on April 17. (Antara/Puspa Perwitasari)

Entering the second half of his leadership tenure, President Joko “Jokowi” Widodo has approved various development projects that will become final additions to the current administration’s list of national strategic projects.

Coordinating Economic Minister Darmin Nasution claims that President Jokowi recently approved 55 new projects and one program to the existing list. The addition brings the total to 245 strategic projects and two programs needing an estimated investment of more than Rp 4 quadrillion (US$300.4 billion) to complete.

A little over a year after his inauguration as the country’s seventh president in October 2014, Jokowi issued Presidential Decree (Perpres) No. 3/2016 and Presidential Instruction (Inpres) No. 1/2016, which identify a list of 225 national strategic projects that include, among others, 47 highway projects, five national non-toll roads, 12 railway projects, 11 airport revitalization works and construction of four new airports.

Both regulations serve as legal standings for public officials to revise or replace rules that hamper development, and to accelerate land acquisitions.

Since then, 20 projects worth Rp 33.5 trillion have been completed, while 15 projects worth Rp 40.5 trillion have been cut out of the list of national strategic projects.

New additions to the list consist of 45 multi-sectoral projects, seven toll road projects, three railway projects and one aircraft construction program. Darmin confirmed that the new projects would be the final batch added onto the list, as instructed by the President, whose tenure expires in October 2019.

“This is the final [addition] for this administration. One of the requirements for a national strategic project is that it has to start construction before 2018. This means that we cannot add more until this administration finishes in 2019,” he told reporters following a closed-door Cabinet meeting at the State Palace in Central Jakarta on Wednesday.

Infrastructure development has been an important feature of Jokowi’s administration, with a majority of the projects intended to increase connectivity and create added value.

Since the beginning of the year, the administration has buckled down to review its projects and President Jokowi has held 22 meetings to discuss projects in each province with his relevant ministers and other stakeholders.

In his opening remarks, the only part of Wednesday’s meeting in which reporters were allowed to cover, Jokowi said that the infrastructure developments were on track, with more than 40 percent of the national strategic projects planned by his administration undergoing construction. Another 37 percent of the projects, meanwhile, are still in the planning stages, he claimed.

Moreover, Jokowi also emphasized that the projects on the list must be able to contribute to the local economy, lower the poverty rate, increase welfare and create jobs.

“I always underline that the national strategic projects must have a significant and real effect on the region’s economy,” he said, adding that the government must also ensure that the non-government infrastructure project funding scheme was managed transparently in order to pull in more investment from the private sector.

While land acquisition has remained a large issue faced by Indonesian authorities in infrastructure development, the Finance Ministry through its State Asset Management Agency (LMAN) launched last month a new scheme to fund land acquisition for the national strategic projects.

As part of the new scheme, two public bodies, the Indonesia Toll Road Authority (BPJT) and the Public Works and Public Housing Ministry, signed a memorandum of understanding (MoU) with 23 toll road companies (BUJTs).

Under a 2016 presidential regulation, LMAN should plan for funding and the utilization of land banks as well as pay compensation for land acquisition to support the government’s infrastructure development programs. The government allocated for the agency state capital worth Rp 16 trillion and Rp 20 trillion in the 2016 and 2017 state budgets, respectively.