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ECONOMY > External Relations

Bidding begins for new Japan-backed port development in Indonesia

  • November 10, 2017
  • , Kyodo News , 1:48 p.m.
  • English Press

JAKARTA — The Indonesian government has started inviting bids for a new Japan-backed strategic port development project in the east of Jakarta, which it hopes will attract investment in Southeast Asia’s largest economy by improving its logistics.

 

Jakarta and Tokyo have confirmed that Indonesia will own 51 percent of the entity to operate the Patimban port in West Java Province’s Subang Regency, with the remainder owned by Japan, Chandra Irawan, port director of Sea Transportation, said in a statement released by the Ministry of Transportation following the Oct. 31 public notice of the first round of bidding.

 

The port project is part of Japan’s cooperation in developing infrastructure in the Southeast Asian country, along with a planned medium-speed railway project linking Indonesia’s two largest business hubs of Jakarta and Surabaya and a metro system under construction in the capital.

 

In mid-November, the two nations are expected to sign an agreement on a soft loan provided via the Japan International Cooperation Agency, a development aid arm of the Japanese government, according to Chandra.

 

Amid rapid economic growth, with a growing number of companies investing in the country, Indonesia has been hampered by traffic gridlock in and around Jakarta. Japanese firms such as automobile and auto parts makers in industrial parks east of Jakarta have been bothered by bad access to the existing Tanjung Priok port in the capital.

 

The planned Patimban port on the northern coast of West Java is expected to help handle more containers and cars from the area and cater to needs for companies that want to smoothly export their products.

 

Indonesia has accepted Japan’s request for more investment from the Indonesian private sector in the Patimban port project, giving a larger share of 26 percent or more to the private sector, while the government will control 25 percent or less, Hiroshi Narahira, vice minister for international affairs of Japan’s Land, Infrastructure, Transport and Tourism Ministry, said in the statement.

 

The port construction is scheduled to start in 2018 following the opening of the first round’s bids in January. (NNA/Kyodo)

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