Posted on 30 Apr 2015
No more hot air on infrastructure: Jokowi
President Joko “Jokowi” Widodo
pledged on Wednesday to walk the talk in fulfilling his infrastructure
development promises, amid worries among investors over the sluggish
realization of infrastructure spending.
Over the next few days, Jokowi is scheduled to commence the construction of
several infrastructure projects, a move that the President claimed showed that
he was not a “talk-only” leader, as critics have suggested.
“If someone doubts that my talk is cheap, if they have questions on why [the
infrastructure projects] are yet to begin, then they must realize that there
are administrative issues that have to be completed first,” he stated.
“Tomorrow [Thursday] we will perform the ground-breaking of the trans-Sumatra
toll road connecting Lampung to Aceh,” he said. “Our focus is clear:
infrastructure development.”
Jokowi is betting big on infrastructure development in his mission to drive
domestic economic growth to 7 percent amid a global slowdown, with the
President inheriting an economy that last year grew at a mere 5 percent, the
lowest level in five years.
To achieve the objective, Jokowi has boosted government capital expenditure
(capex) funds — a spending allocation that includes ministerial investments and
infrastructure projects — to around Rp 290 trillion in the revised 2015 state
budget, compared with Rp 156 trillion in the original budget formulated by then
president Susilo Bambang Yudhoyono.
But economists have said that some infrastructure projects have got off to a
sluggish start. According to the most recent Finance Ministry data, the budget
disbursement rate for capex funds for the 10 ministries with the biggest fund
allocations stood at only 2.8 percent as of April 28.
The capex fund disbursement rate at the Public Works and Public Housing
Ministry and the Transportation Ministry — which together bear most
responsibility for government infrastructure projects — stood at 2.8 percent
and 1.1 percent, respectively.
On the sluggish realization of infrastructure projects, Jokowi explained: “The
administrative and auction processes are still ongoing. In April, May, June,
July, we should see more ground-breaking of housing, farming and seaport
infrastructure projects.”
State-Owned Enterprises Minister Rini Soemarno said on Wednesday that at least
Rp 100 trillion of infrastructure projects would commence construction in June,
including a highway connecting Bakauheni and Terbanggi Besar in Lampung,
another highway linking Palembang and Indralaya in South Sumatra and a seaport
in Makassar, South Sulawesi, all of which would be handled by state-run firms.
She predicted total investment from state-run companies in infrastructure
projects would hit Rp 300 trillion this year, with other projects also set to
commence soon, including the building of power plants with combined capacity of
5,000 megawatts, the construction of the Solo-Kertosono toll road in Central
and East Java and mineral-processing smelters in Halmahera, North Maluku, and
Gresik, East Java.
Among the infrastructure projects in Jakarta that are to begin soon are the
extension of runway at Soekarno-Hatta airport, as well as the upgrade of the
Manggarai railway station and new railways in Jakarta, Bogor and Tangerang,
according to the minister.
“As such, the realization of infrastructure projects managed by state-run firms
will be truly massive,” said Rini.
President
Joko “Jokowi” Widodo pledged on Wednesday to walk the talk in
fulfilling his infrastructure development promises, amid worries among
investors over the sluggish realization of infrastructure spending.
Over
the next few days, Jokowi is scheduled to commence the construction of
several infrastructure projects, a move that the President claimed
showed that he was not a “talk-only” leader, as critics have suggested.
“If
someone doubts that my talk is cheap, if they have questions on why
[the infrastructure projects] are yet to begin, then they must realize
that there are administrative issues that have to be completed first,”
he stated.
“Tomorrow [Thursday] we will perform the
ground-breaking of the trans-Sumatra toll road connecting Lampung to
Aceh,” he said. “Our focus is clear: infrastructure development.”
Jokowi
is betting big on infrastructure development in his mission to drive
domestic economic growth to 7 percent amid a global slowdown, with the
President inheriting an economy that last year grew at a mere 5 percent,
the lowest level in five years.
To achieve the objective, Jokowi
has boosted government capital expenditure (capex) funds — a spending
allocation that includes ministerial investments and infrastructure
projects — to around Rp 290 trillion in the revised 2015 state budget,
compared with Rp 156 trillion in the original budget formulated by then
president Susilo Bambang Yudhoyono.
But economists have said that
some infrastructure projects have got off to a sluggish start.
According to the most recent Finance Ministry data, the budget
disbursement rate for capex funds for the 10 ministries with the biggest
fund allocations stood at only 2.8 percent as of April 28.
The
capex fund disbursement rate at the Public Works and Public Housing
Ministry and the Transportation Ministry — which together bear most
responsibility for government infrastructure projects — stood at 2.8
percent and 1.1 percent, respectively.
On the sluggish
realization of infrastructure projects, Jokowi explained: “The
administrative and auction processes are still ongoing. In April, May,
June, July, we should see more ground-breaking of housing, farming and
seaport infrastructure projects.”
State-Owned Enterprises
Minister Rini Soemarno said on Wednesday that at least Rp 100 trillion
of infrastructure projects would commence construction in June,
including a highway connecting Bakauheni and Terbanggi Besar in Lampung,
another highway linking Palembang and Indralaya in South Sumatra and a
seaport in Makassar, South Sulawesi, all of which would be handled by
state-run firms.
She predicted total investment from state-run
companies in infrastructure projects would hit Rp 300 trillion this
year, with other projects also set to commence soon, including the
building of power plants with combined capacity of 5,000 megawatts, the
construction of the Solo-Kertosono toll road in Central and East Java
and mineral-processing smelters in Halmahera, North Maluku, and Gresik,
East Java.
Among the infrastructure projects in Jakarta that are
to begin soon are the extension of runway at Soekarno-Hatta airport, as
well as the upgrade of the Manggarai railway station and new railways in
Jakarta, Bogor and Tangerang, according to the minister.
“As
such, the realization of infrastructure projects managed by state-run
firms will be truly massive,” said Rini. - See more at:
http://www.thejakartapost.com/news/2015/04/30/no-more-hot-air-infrastructure-jokowi.html#sthash.gIPjgj89.dpuf
