Foreign Banks to Join Infrastructure Development
10 April 2015 09:06 WIB
TEMPO.CO, Jakarta - Achmad Baiquni, the CEO of state-owned Bank Negara Indonesia (BNI), said the urgent need for the financing of infrastructure projects had drawn the attention of foreign banks to participate in the projects.
“The foreign banks that would like to provide the financing could actually become partners for an infrastructure bank,” he said after a hearing with House lawmaker on Thursday.
Achmad said the partnerships would keep the foreign banks from owning the projects 100 percent, and that the existence of an infrastructure banks had now become more crucial for infrastructure financing, which commercial banks could not attend to completely yet.
“It is because the sources of funds of an infrastructure bank are different from those of commercial banks like us,” he said.
Earlier, Finance Minister Bambang Brodjonegoro said infrastructure project financing had been facing hurdles, among them due to the limited funds from the government and the lack of enthusiasm of state-owned enterprises in working on the projects. According to the minister, the investment climate in this sector was less conducive due to land procurement issues.
Thus, the minister called for the establishment of an infrastructure bank from the merger of state infrastructure-financing company PT Sarana Multi Infrastruktur (SMI) and state investment agency Government Investment Center. The government will also embolden the Indonesian Infrastructure Financing Agency (LPPI) to boost ties with private investors and the banking sector.
ANDI RUSLI | TRI ARTINING PUTRI