Indonesia - Indonesia boosts Jakarta infrastructure

The central government has disbursed Rp 289.5 billion (US$32.4 million) as part of efforts to boost infrastructure development in and around the capital.

The government, through the Government Investment Center (PIP), said the money would help finance land acquisitions in the Greater Jakarta area.

Greater Jakarta includes Jakarta, Bogor, Depok, Tangerang and Bekasi.

The government loaned Rp 98.5 billion to Marga Kunciran Cengkareng, the toll road concession holder that is building the 14.2-kilometer toll road linking Kunciran, in Tangerang, to West Jakarta’s Cengkareng, PIP said in a statement on Wednesday.

On September 9, the government disbursed Rp 96 billion to Marga Trans Nusantara, which is building the 11.2-kilometer toll road linking Kunciran and Serpong, in Cengkareng.

And in August, the government loaned Rp 95 billion to Citra Waspphutowa to help it build the 21.5-kilometer toll road linking Depok to Jalan Antasari in South Jakarta.

Indonesia has been pushing infrastructure development in the form of seaports and toll roads as part of its efforts to provide more jobs and boost economic growth. Indonesia’s economy, which expanded 6.1 percent in 2010, is forecast to grow by 6.5 percent this year and 6.7 percent in 2012.

“The government and toll-road regulator agreed to use the funds as bridging loans,’’ PIP said in a statement.

The loans will be due in two years with an annual interest rate of 7.25 percent, the center said.

That rate is lower than the 11 percent prime lending rate, which is the rate that commercial banks charge their best customers on loans.

The government’s program to develop infrastructure in Jakarta and the immediate vicinity, known as the Metropolitan Priority Area, will begin as scheduled in early 2013, the chief economics minister, Hatta Rajasa, said in August.

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