Challenges and Opportunity for Sustainable Infrastructure Projects in Indonesia
In Cooperation with the Royal Danish Embassy
04 March 2013
Author: Administrator
Jakarta, March 4, 2013 - The Development of Infrastructure and environmental issues pose new challenges for all parties within the infrastructure sector. In other words, infrastructure development must be aligned with efforts to preserve the environment. Effort and awareness of environment preservation has been brought to the forefront throughout the world, including Indonesia, which has placed it into the agenda 2015 (post MDG Development Agenda 2015). In his Speech at the meeting of the G-24 in Monrovia in 2012, President Yudhoyono stressed the importance of focusing on poverty eradication, and sustainable and environmentally sound development. Specifically, he mentioned four important points, one of which is the development of a continuously sustainable development model to address the problems of climate change, natural resources and environmental preservation.
The focal point the coming Infrastructure Forum Dialogue Series will be on the application and adoption of innovative technologies which are environmentally oriented, sustainable and applicable to infrastructure projects in Indonesia currently under construction, and for potential projects under development. The importance of environmental issues is well recognized by developed countries, which have adopted green principles in the implementation of its development. Denmark is one of the first countries which would be free from oil dependence by 2050. The country also declared that it will be carbon dioxide (CO2) neutral by 2025. In its effort to reach these objectives, Denmark is consistently committed to environmentally sound development. Danish Minister for Trade and Investment, Pia Olsen Dhyr says "Denmark is committed to pioneering the transition towards environmentally sound development, becoming a country with green growth economy; end free from dependence on fossil fuels by 2050".
This latest dialogue series will be held in cooperation with the embassy of Denmark, along with the participation of several Danish companies experienced in policy frameworks, and innovative solutions in developing sustainable infrastructure projects.
the guest speakers will include Ir. Tamba Hutapea, Deputy Chairman of BKPM; Dr. Wahyu Utomo, Assistant Deputy Housing - Deputy for Infrastructure and Regional Development, Coordinating Ministry for Economic Affairs; and Dr. Ir. Bastary Pandji Indra, MSP, Director of Public-Private Partnership Development, BAPPENAS. The speakers will be addressing the issues clearly and openly in this interactive forum. "The emphasis of this dialogue will be developing sustainable infrastructure, and becoming a Green Economy” said Bernard Djonoputro, the Conference Leader, and Managing Director of PT Nusantara Infrastructure Tbk.
In addition to knowledge sharing, Denmark hopes to further develop bilateral relations between the two countries. "The visit of the Minister of trade and Investment is an important milestone in towards this objective" said Martin Bille Hermann, Ambassador of Denmark to Indonesia.
There is a long list of infrastructure projects in Indonesia. From the data released by the National Development Planning Agency BAPENAS, the funds needed to develop infrastructure in the next five years amounts to over 140 billion U.S. dollars. Of this total, the government's financial capacity is only about 35%. This rest expected to be raised through the PPP (Public Private Partnership) Schemes.
The main challenge under the PPP Schemes include issues of contacts, commercial viability, land acquisition, regulatory overlaps and lack of capacity of the PPP tender organizer. These issues have severe implications towards the economic growth and the rate of investment in Indonesia. From the standpoint of investors, the slow progress of resolving this issue is one of the key concerns which lead to a more cautious approach to investing into the sector, resulting in a growing urgency for Indonesia's infrastructure development plans.
Around 150 businessmen, professionals and industry leaders from both Denmark and Indonesia will be in attendance at Dialogue Series, coming from a diverse sector background, including toll roads, ports, water, and electricity as well as energy. The academic field and the national media representatives will also be present. (End)
