RI, Japan ink loan deal
for infrastructure projects
Dylan Amirio, The Jakarta Post, Jakarta | Business | Sat, November 28 2015, 5:26 PM
Indonesia and Japan signed a loan agreement on Friday in which the East Asian country has committed to providing ¥140.051 billion (US$1.14 billion) to support several infrastructure and energy projects in this country, including Jakarta’s Mass Rapid Transit (MRT) system and an electricity transmission network.
The agreement was signed by Japanese Ambassador to Indonesia Yasuaki Tanizaki and the Foreign Ministry’s director general for the Asia-Pacific and Africa, Yuri O. Thamrin.
The deal followed up Japanese Prime Minister Shinzo Abe’s announcement about the proposed assistance during President Joko “Jokowi” Widodo’s visit to Japan in March.
The ¥140.051 billion will be disbursed and distributed by 2019 for three specific projects. Up to ¥75.2 billion will be used to develop the next phase of the MRT for the Hotel Indonesia traffic circle in Central Jakarta to Kampung Bandan in North Jakarta.
Currently, construction work is ongoing for the first phase of the north-south line from Lebak Bulus in South Jakarta to the traffic circle. The construction is expected to be finished in 2018.
Another 1.919 billion Yen will be used to develop phase one of the Jakarta MRT’s east-west route, from Kampung Melayu in East Jakarta to the Hotel Indonesia traffic circle.
The Japanese Embassy’s economic counsellor, Takuro Tasaka, however, said the east-west line project is still under preliminary discussion, meaning that Indonesia has yet to decide on the design and concept of the route.
“In accordance with the wishes of Prime Minister Shinzo Abe, Japan will continue to expand and stand by its commitment to help develop infrastructure in Indonesia. We feel that the Jakarta MRT would become a major transportation innovation here,” Tasaka said on Friday.
Japanese companies Shimizu, Tokyu, Obayashi and Sumitomo Mitsui are among those involved in the construction of the Jakarta MRT. Underground drilling for the project began in September.
Also in September, MRT Jakarta president director Dono Boestami said that 43 percent of the underground construction has been completed and 18 percent of the above-ground construction is finished.
Aside from the MRT project, a portion of the loan will be used for the construction of a transmission system that will deliver electricity between Java and Sumatra.
Up to ¥62.9 billion will be spent on the project, which will also involve the construction of an electricity transmission station and an AC/DC converter station.
Tasaka added that parts of the electricity project are still currently in the tendering process, but a contractor has already been found to work on it.
Each of the three loans come with their own conditions: the one for the east-west Jakarta MRT project is subject to interest of 0.01 percent per year with a 25-year return period, while loan for the second phase of the north-south line carries an interest of 0.1 percent a year with a tied return period of 40 years.
The electricity project loan carries an interest of 1.4 percent per year with a return period of 25 years.
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Partnership with Japan
can boost RI industry
Prima Wirayani, The Jakarta Post, Jakarta | Business | Wed, November 25 2015, 5:28 PM
Japan-Indonesia business: Japan-Indonesia Economic Committee (Keidanren) chairman Shigeo Oyagi
(left), Indonesian Trade Minister Thomas Lembong
(second left), Japanese Economy, Trade and Industry Minister Motoo Hayashi and Japan External Trade Organization (JETRO) chairman Hiroyuki Ishige chat during the opening of the Indonesia-Japan Business, Trade & Investment Symposium at the Fairmont hotel in Jakarta on Tuesday. The event was organized by JETRO to discuss current investment between the two countries.(JP/Jerry Adiguna)
Business News
Indonesia can strengthen its industrial structure and increase the quality of its economic growth through a strong partnership with Japan, officials have said.
Japan External Trade Organization (JETRO) vice president Yuri Sato said on Tuesday that the East Asian country could offer its experiences and established global networks to help Indonesia build its manufacturing to offset low export revenues caused by plummeting commodity prices.
“Japan’s government and businesspeople can assist Indonesian companies to diversify exports and improve productivity through transfer of knowledge and technology,” she said during the Indonesia-Japan Business, Trade and Investment Partnership Symposium in South Jakarta.
The symposium was attended by, among others, Indonesian Trade Minister Thomas Trikasih Lembong, Japanese Economy, Trade and Industry Minister Motoo Hayashi and Japan-Indonesia Parliamentary League chairman Toshihiro Nikai.
Sato added that the current sluggish economic situation was a “blessing in disguise” for Southeast Asia’s largest economy as its only solution was to change its export structure, which currently depends mostly on unprocessed commodities, to concentrate more on manufactured products.
Data from the Central Statistics Agency (BPS) shows that primary commodities — such as crude palm oil (CPO) and rubber — make up the largest part of the country’s export portfolio worth US$121.8 million, around 14 percent of non-oil and gas commodity values, as of October.
Sato said that Indonesia had fundamental advantages that could ensure a sustainable economic growth and attract investments, such as a large population, a so-called demographic bonus, a stable political situation and abundant natural resources.
Meanwhile, JETRO chairman and CEO Hiroyuki Ishige said that his office intended to actively work with the Indonesian government to boost exports and encourage investment exchanges to integrate the region’s economies.
“Several problems have happened around the high-speed train project, but we are still cooperating to strengthen competitiveness in industry, infrastructure and human resources development,” he said.
Japan and China were in a heated competition to win the nation’s first-ever high-speed rail project, connecting Jakarta with Bandung in West Java. The government eventually chose China to build the link.
Nevertheless, a meeting between Japanese Prime Minister Shinzo Abe and President Joko “Jokowi” Widodo in Kuala Lumpur on Sunday signaled that both countries intended to continue cooperating. Jokowi said after the meeting that Indonesia would engage with Japan in future infrastructure projects, in addition to maintaining existing investments in infrastructure, manufacturing and industry.
Minister Thomas stated that currently the government was loosening its protectionist economic policies, which hampered industrial growth and worsened the country’s economic situation.
“Openness is important and it can facilitate the integration of Indonesia’s economy into the region,” he said, hailing Abe’s economic policy as bold, assertive and reformist.
Meanwhile, Minister Hayashi expressed hope that Indonesia’s and Japan’s relationship could be stronger and mutually beneficial in both ASEAN and globally.
“In this global economic uncertainty, it is important for Indonesia’s and Japan’s partnership to expand further and jack up the global economy,” he said.
Japan is Indonesia’s number one export market. Export values booked last year amounted to $23.1 billion, 13.1 percent of the value of Indonesia’s total exports. Japan is Indonesia’s number three importer, bringing in goods and services worth $17 billion, 9.5 percent of total imports.
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Partnership with Japan can boost RI industry | The Jakarta Post
