Head of Working GroupScott YoungerDirector
About the Group
Indonesia is inching its way up the competitiveness ladder, moving ahead five places since last year to 36th place in 2017, as reported by the World Economic Forum Global Competitiveness Report (2017-18). Its position in the ranking is driven mainly by its large market size and a relatively robust macroeconomic environment. Further reported is that Indonesia’s overall infrastructure has improved compared to last year and now ranks at 52nd place, climbing from last year’s position at 60th place. Despite the improvement, the report also shows inadequate supply of infrastructure as one of the most problematic factors for doing business in Indonesia.
President Joko Widodo’s administration has pledged to improve development and has continued with many initiatives intended to increase infrastructure spending until 2019. To date, the government has included major infrastructure developments in its National Medium-term Development Plan 2015-2019 and has identified national strategic infrastructure projects as well as established the Committee for the Acceleration of Priority Infrastructure Delivery.
Priority projects include the revitalisation of airports, the development of thermal and hydropower plants, toll roads, Mass Rapid Transit (MRT) and the construction of new and the upgrading of existing ports. However, the general perception is that the country’s infrastructure is more dependent upon state-owned enterprises (SOE) than other areas of the economy, while conversely the private sector is perceived to be limited in its ability to make significant contributions to the overall span of infrastructure projects.
The Infrastructure Working group was formed as a forum for businesses to share updates and discuss the latest trends and policy developments in the Infrastructure sector. The working group is specifically looking at energy infrastructure, toll roads, airports, railroads, seaports, and water and sanitation.
In 2017 the group met and held discussions with stakeholders and policy makers about development policies for water resources and sanitation in Indonesia. The group also organised meetings to provide an overview of the Indonesia’s transportation infrastructure in relation to investment prospects for the private sector. The group developed a comprehensive Position Paper on the Infrastructure sector that offered recommendations for development acceleration.
The Infrastructure Working Group is currently monitoring policy development in the following sectors:
- Policy on transportation development including roads, highways, seaports and airports, MRT and railways.
- Policy on water resources and sanitation.
- Policy on telecommunication infrastructure.
- Policy on power generation.