ASEAN KEY DESTINATIONS
Jokowi sets out infrastructure stall to court investors
President Joko “Jokowi” Widodo has utilized his first overseas trip not only to introduce his future economic policies to potential foreign investors but also to resolve Indonesia’s most pressing issue: infrastructure.
Before hundreds of businesspeople attending the prestigious APEC CEO forum in Beijing on Monday, Jokowi presented his ambitious infrastructure projects and his pledge to allocate most of his resources in the immediate term to facilitate their construction.
Jokowi was among four world leaders, aside from Chinese President Xi Jinping, US President Barack Obama and Russian President Vladimir Putin, who was given the rare opportunity to deliver his keynote speech at the event.
Pointing to a series of Power-Point slides, Jokowi presented his so-called maritime-axis vision that partly covered the construction and expansion of 24 integrated seaports across the archipelago, the development of toll roads along the shore of Java and the construction of 35,000 megawatt power plants.
While many investors have repeatedly complained over the many problems in land acquisition and permit approvals that have held back infrastructure development, Jokowi used the opportunity to ease worries.
“A lot of investors come to me to complain about land acquisition. I will push my ministers, governors and mayors to help clear this problem. My experience with land acquisition while serving as Jakarta governor is as an example of a success story,” said Jokowi.
He cited the construction of a section in the Jakarta Outer Ring Road, which had been halted for eight years due to land problems.
“There was a 1.5-kilometer stretch [that still had to be built] to link the toll road, as 143 families there had refused to accept compensation for their land. So last year I invited them for lunch and dinner to talk about the issues. After the fourth meeting, they agreed to relinquish their land,” he said.
Businesspeople have suggested that for Indonesia’s economy to grow by more than 6 percent, the government will have no other option than to expand the capacity of the country’s entire business infrastructure, particularly toll roads, ports, power plants and railways.
Having considered infrastructure as key to his administration, Jokowi requested President Xi on Sunday to be more involved in Indonesia’s infrastructure development, particularly in the maritime sector.
“I’ve requested to President Xi that Chinese state companies be involved more in the construction of our seaports, railways and toll roads,” he said.
Jokowi also pushed for a bigger role in the China-led Asian Infrastructure Investment Bank (AIIB), by proposing that the bank open its headquarters in Jakarta for funds to flow into the country.
“There is hope that this time our President means business. There are so many concrete plans in the infrastructure sector that are already laid out clearly for businesspeople to participate,” said Indonesian Chamber of Commerce and Industry (Kadin) deputy chairman Chris Kanter, who also participated in the CEO forum.
Jokowi was also quick to address problems in the issue of business permits in the development of infrastructure by pledging to establish an integrated one-stop service office.
“The process for getting licenses to build power plants can take up to six years. This can no longer be tolerated,” he said.
Jokowi also took the opportunity to address foreign investors about his budget policies by repeating his pledge on cutting whopping fuel subsidies and allocating the fund to more productive sectors such as education, infrastructure, agriculture and health.
“Our state budget in 2015 is US$167 billion and we will spend around $27 billion on fuel. It’s huge. So we want to channel the fuel subsidies from consumption to the productive sectors such as for seeds, fertilizers, irrigation and for the construction of 25 dams in five years,” said Jokowi.
Prior to the CEO forum, Jokowi also took the opportunity to meet businesspeople from Indonesia and China in Beijing on Sunday, when he also raised infrastructure and fuel subsidy issues as well as the remedies provided by the government to tackle the problems.
“The business communities in the two countries need signals and directions from the new President. And I believe Jokowi has provided us with a clear vision on where the country is heading,” said Sinar Mas managing director Gandhi Sulistyo, who also attended the event.
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