Indonesia: Government Allows Private Investment in Infrastructure Projects

• Feb 24, 2017

TEMPO.CO, Jakarta – The Public Works and Public Housing secretary general Anita Firmanti said that the ministry has allowed private investors to be involved in infrastructure projects. She said that the government has also been working closely with Japanese investors.

“Deregulation has taken place to allow permits for private investors in the field of infrastructure,” Anita said in a written statement on Thursday, February 23, 2017.

According to Anita, infrastructure sector has seen significant improvements in the last three years as demonstrated by Indonesia’s Global Competitiveness Index in infrastructure in 2016, climbing from 62 to 62.

Anita sees that the government has taken an important move in allowing private investment in infrastructure industry because the need for infrastructure development in Indonesia is still high. The government is currently facing financial issues in completing the projects. Out of roughly Rp800 trillion needed to finance infrastructure project in the current 5-year period, only around Rp300 trillion has been allocated to the Public Housing Ministry.

Anita said that the government and state-owned enterprises have been dominant in toll road development. She argued that Indonesia could emulate Japan’s private housing development scheme.

Anita added that a large number of infrastructure cooperation agreement with Japan will allow transfer of technology to Indonesian engineers. In addition, she has also appreciated scholarship programs offered by Japan Government in the field of infrastructure to Indonesian students.

Source: https://en.tempo.co/read/news/2017/02/24/056849844/Government-Allows-Private-Investment-in-Infrastructure-Projects