President Grants Investment Guarantees
Thursday, 02 November, 2006 | 12:45 WIB

TEMPO Interactive, Jakarta: The government will provide investment guarantees to investors who invest in various projects proposed in the Indonesia Infrastructure Conference & Exhibition 2006.

In his speech when opening the conference at the Jakarta Convention Center yesterday (11/1), President Susilo Bambang Yudhoyono said that the guarantees will take the form of risk distribution for several public-private partnership projects such as the crash program of 10,000 megawatt electricity generating plant construction.

Yudhoyono cited the investment guarantee as a mutual package so that it will be fairer for investors.

“In order to offer better investment certainty,” he said, ”the government is ready to share the risks together.”

The government has acted this way, said Yudhoyono, because it realized that the main concern in private partnership would be of profit.

In addition, the offered infrastructure projects are those with long-term investment returns.

“However, the guarantee will only work for projects that are truly prepared and meet the conditions of public-private partnership.”

The conditions, according to him, will be in accordance with those attached in the Presidential Regulation Number 67/2005 concerning cooperation between the government and businesses in supplying infrastructure.

The President invited all investors, contractors and private financial institutions to take part in 10 model project valued at US$4.5 billion and 101 other potential projects valued at US$14.4 billion.

“I am here only as a salesman or someone from customer service who is ready to receive investors' complaints,” he said.

Finance Minister Sri Mulyani Indrawati separately explained that the infrastructure projects must comply with four conditions to gain government support.

“The business must be real; a feasibility study must have been carried out; there must have been public consultation; and the tender must be carried out openly.”

In addition, she said, the projects must have first been selected by the Committee for Accelerating Infrastructure Development.

The Committee has a unit which organizes the projects in terms of technicalities and legalities.

The unit evaluation will be the base for the Finance Minister to determine risk possibility and the required guarantee.

BADRIAH | EKO NOPIANSYAH | HARUN MAHBUD | ANTON APRIANTO