Ada Pertanyaan? Hubungi Kami 
Ada Pertanyaan? Hubungi Kami Fitri Novia Heriani, Mahinda Arkyasa
Even though Indonesia’s economy shows a stable and robust growth, there are still some problems that may hamper economic activities.
One of the problems is infrastructure. It is clear that Indonesia’s infrastructure is poor—including the quality of roads and railways—leading to high transportation costs, which, in turn, increase the price of domestic products.
Most of the stakeholders agree that poor infrastructure is caused by lack of funding from the State Budget. The allocated funds for infrastructure development are often inadequate and are sometimes utilized for other unnecessary sectors.
The banking sector believes that this problem can be solved by banks funding infrastructure projects. Ryan Kiryanto, Chief Economist of Bank Negara Indonesia (BNI), confirmed this and also said that as a state-owned bank, BNI has the ability to fund infrastructure development. However, Ryan asserted that there are no apparent programs to be funded.
“When the programs are unclear, how can we fund them?” Ryan asked during a media gathering event at Hotel Borobudur, Jakarta, Monday (26/11).
Ryan explained that Indonesia’s infrastructure spending is relatively low at 2.2 percent of the GDP, while it should be at 5 percent.
To solve this problem, Ryan urged the Government to provide incentives for banks, such as BNI, that are capable of funding infrastructure development. For example, banks have an easier access to remote regions of Indonesia where they can open branch offices.
Ryan said that incentives will allow banks to reach industries in certain regions. They will also positively impact the implementation of Master Plan for the Acceleration and Expansion of Indonesian Economic Development (MP3EI) and infrastructure development.
Without proper and adequate infrastructure, Ryan said, progress of MP3EI implementation will be hindered and slow.
The Government, on the other hand, admitted that the institutional framework for infrastructure development is not at its optimum.
“Indonesia is falling behind other countries in terms of infrastructure development,” said Lucky Eko Wiryanto, Deputy of Infrastructure and Regional Development Division of the Coordinating Minister for Economic Affairs.
The Government, Lucky explained, cannot rely on public-private partnerships (PPP) to fund infrastructure projects that cannot be funded by the state/regional budget. Which is why the role of state-owned companies (BUMN) is important in funding infrastructure projects.
“There is no solution yet to fund strategic infrastructure projects that are less financially viable, although some of the projects are highly economically viable,” Ryan explained.
Although there is no clear solution yet, the government—particularly the National Development Planning Agency (Bappenas)—is now preparing several policies to address the issue of infrastructure funding.
“The plan includes limiting foreign loans for Government and BUMN projects; encouraging investment in infrastructure projects through PPP; and encouraging BUMNs to invest in infrastructure projects by assigning and offering infrastructure projects,” said Dedy S. Priyatna, Deputy of Facilities and Infrastructure Division at Bappenas.
Dedy asserted that the Government must create a breakthrough policy on infrastructure financing in order to attract private businesses and BUMNs to invest in infrastructure development.
(hot/jt)
Fitri Novia Heriani, Mahinda Arkyasa
Even though Indonesia’s economy shows a stable and robust growth, there are still some problems that may hamper economic activities.
One of the problems is infrastructure. It is clear that Indonesia’s infrastructure is poor—including the quality of roads and railways—leading to high transportation costs, which, in turn, increase the price of domestic products.
Most of the stakeholders agree that poor infrastructure is caused by lack of funding from the State Budget. The allocated funds for infrastructure development are often inadequate and are sometimes utilized for other unnecessary sectors.
The banking sector believes that this problem can be solved by banks funding infrastructure projects. Ryan Kiryanto, Chief Economist of Bank Negara Indonesia (BNI), confirmed this and also said that as a state-owned bank, BNI has the ability to fund infrastructure development. However, Ryan asserted that there are no apparent programs to be funded.
“When the programs are unclear, how can we fund them?” Ryan asked during a media gathering event at Hotel Borobudur, Jakarta, Monday (26/11).
Ryan explained that Indonesia’s infrastructure spending is relatively low at 2.2 percent of the GDP, while it should be at 5 percent.
To solve this problem, Ryan urged the Government to provide incentives for banks, such as BNI, that are capable of funding infrastructure development. For example, banks have an easier access to remote regions of Indonesia where they can open branch offices.
Ryan said that incentives will allow banks to reach industries in certain regions. They will also positively impact the implementation of Master Plan for the Acceleration and Expansion of Indonesian Economic Development (MP3EI) and infrastructure development.
Without proper and adequate infrastructure, Ryan said, progress of MP3EI implementation will be hindered and slow.
The Government, on the other hand, admitted that the institutional framework for infrastructure development is not at its optimum.
“Indonesia is falling behind other countries in terms of infrastructure development,” said Lucky Eko Wiryanto, Deputy of Infrastructure and Regional Development Division of the Coordinating Minister for Economic Affairs.
The Government, Lucky explained, cannot rely on public-private partnerships (PPP) to fund infrastructure projects that cannot be funded by the state/regional budget. Which is why the role of state-owned companies (BUMN) is important in funding infrastructure projects.
“There is no solution yet to fund strategic infrastructure projects that are less financially viable, although some of the projects are highly economically viable,” Ryan explained.
Although there is no clear solution yet, the government—particularly the National Development Planning Agency (Bappenas)—is now preparing several policies to address the issue of infrastructure funding.
“The plan includes limiting foreign loans for Government and BUMN projects; encouraging investment in infrastructure projects through PPP; and encouraging BUMNs to invest in infrastructure projects by assigning and offering infrastructure projects,” said Dedy S. Priyatna, Deputy of Facilities and Infrastructure Division at Bappenas.
Dedy asserted that the Government must create a breakthrough policy on infrastructure financing in order to attract private businesses and BUMNs to invest in infrastructure development.
(hot/jt)