Pa­tim­ban Port to reach fi­nan­cial close soon

The Jakarta Post - - BUSINESS - An­ton Her­man­syah

The gov­ern­ment is slated to fi­nal­ize a loan agree­ment with the Ja­pan In­ter­na­tional Co­op­er­a­tion Agency (JICA) next month to sup­port the con­struc­tion of Pa­tim­ban Port in West Java af­ter the lat­ter com­pletes doc­u­ments re­quired for the deal.

Trans­porta­tion Min­is­ter Budi Karya Su­madi said the gov­ern­ment and JICA had agreed on prin­ci­pal as­pects of the loan agree­ment, but needed to iron out de­tails.

“The fi­nan­cial close will be in Oc­to­ber and the ground­break­ing will start ei­ther in De­cem­ber or Jan­uary,” Budi said af­ter a meet­ing at the of­fice of the co­or­di­nat­ing mar­itime af­fairs min­is­ter in Jakarta, re­cently.

He said the con­struc­tion of ve­hi­cle ter­mi­nals would be car­ried out in March 2018 af­ter the port ground­break­ing, while the Pub­lic Works and Pub­lic Hous­ing Min­istry would soon open ten­der for the ter­mi­nals and ac­cess road de­vel­op­ment.

“The land for the ac­cess road is ready and a ten­der to build the road and ter­mi­nal will be held. Hope­fully they can be fin­ished on time,” Budi said.

Aside from pre­par­ing the ten­der, the min­istry an­tic­i­pates smooth land clear­ing by work­ing with the State As­set Man­age­ment Agency (LMAN), which has been al­lo­cated Rp 500 bil­lion (US$37.76 mil­lion) to carry out the task.

How­ever, the LMAN is await­ing the House of Rep­re­sen­ta­tive’s ap­proval of the land clear­ing bud­get.

Ac­cord­ing to West Java pro­vin­cial gov­ern­ment data, the land clear­ing for the port will af­fect 120 fam­i­lies in seven vil­lages, where the res­i­dents also use some of the sea area for aqua­cul­ture.

The West Java ad­min­is­tra­tion had marked land for the port and pro­hib­ited lo­cals from sell­ing the land, said Bay Mokhamad Hasani, the Trans­porta­tion Min­istry’s act­ing sea trans­porta­tion di­rec­tor gen­eral.

The first con­struc­tion phase for the port re­quires 672-ha .

“The con­struc­tion will be­gin from the sea area, so it can be done along with the land clear­ing process,” he said.

The port needs Rp 43.5 tril­lion, with 71 per­cent of the fi­nanc­ing to be cov­ered by a loan from JICA.

The port is de­signed to have a con­tainer ca­pac­ity of 1.5 mil­lion 20-foot equiv­a­lent units (TEUs) af­ter it is par­tially com­pleted in 2019 and 7.5 mil­lion TEUs by 2027, about half the ca­pac­ity of the coun­try’s busiest port, Tan­jung Priok in North Jakarta.

The port will be lo­cated in Subang, around 70 kilo­me­ters from the Karawang In­dus­trial Es­tate in Bekasi, West Java where many Ja­panese au­to­mo­tive fac­to­ries are lo­cated.

The port con­struc­tion is part of Pres­i­dent Joko “Jokowi” Wi­dodo’s call for push­ing in­fra­struc­ture de­vel­op­ment to spur the coun­try’s econ­omy, which is ex­pected to grow 5.2 per­cent and 5.4 per­cent in 2017 and 2018, re­spec­tively.

Co­or­di­nat­ing Mar­itime Af­fairs Min­is­ter Luhut Pand­jai­tan said the port would be man­aged by a joint ven­ture, or con­sor­tium, be­tween state-owned port oper­a­tor Pelindo II, an In­done­sian pri­vate com­pany and a Ja­panese firm. The gov­ern­ment will hold a ten­der to se­lect the lo­cal pri­vate com­pany.

He added that In­done­sia, which is an­a­lyz­ing the le­gal as­pects of the joint ven­ture, would have 51 per­cent shares in the firm and the rest would be owned by Ja­pan. The 51 per­cent own­er­ship would be di­vided be­tween Pelindo II and the lo­cal pri­vate com­pany.

Min­is­ter Budi Karya Su­madi said it would need an ini­tial in­vest­ment of Rp 3 tril­lion to op­er­ate the port, par­tic­u­larly to pur­chase equip­ment.

He added that the gov­ern­ment would pro­vide ini­tial in­vest­ment for op­er­a­tions, thus it would charge con­ces­sion fees to the oper­a­tor.

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