TEMPO.CO, Jakarta - The government has decided to expedite and prioritize the preparation stage of a number of development projects listed at the National Planning Agency (Bappenas) and the Coordinating Economic Minister as a form of implementation of the Masterplan for Acceleration and Expansion of Indonesia's Economic Development (MP3EI).
"The government sees that if there's no prioritization, with so many projects going on, it will be difficult to handle," said the Head of Center for Fiscal Risk Management at the Ministry of Finance Freddy R. Saragih at the Infrastructure Leaders Forum 2013, Jakarta, October 31.
In relation to the prioritization, the government also plans to promulgate a Presidential Regulation (Perpres) that lists 30 to 40 high-priority projects out of hundreds of projects.
Furthermore, Freddy also underlined the need of improvements in Public-Private Partnership (PPP) to meet international standards.
"We can no longer say 'it's like this in Indonesia', we have to [be able to] meet international standards," he stated.
The government also aims to make PPP projects bankable in an effort to gain the interests of international investors. However, the Ministry of Finance has prepared an alternative in form of the Viability Gap Fund (VGF) to provide financial support for PPP projects.
Currently, the government has allocated around Rp 315 billion (around US$ 5,1 billion) of VGF funds. Meanwhile, for 2014, the Ministry of Finance claimed that it has proposed a larger amount of budget of Rp 400 billion (around US$ 6,5 billion) to accommodate two ongoing PPP projects in Surabaya and Lampung.
AMANDA SIDDHARTA
