Indonesia is planning to open up state-owned run infrastructure, such as toll roads, to private investors in an effort to generate fresh funding for new projects.
President Joko “Jokowi” Widodo said on Wednesday that he would ask some state-owned enterprises (SOEs) to sell their concessions in major toll roads, such as the Jagorawi toll road in East Jakarta, to private investors.
Jagorawi, which connects Jakarta to Bogor and Ciawi in West Java, is the country’s oldest toll road and is currently managed by state-owned toll road operator Jasa Marga.
“For Jasa Marga and [state construction firm] Waskita Karya, which own many toll roads, your job is to build a toll road, not to own it,” the President said on Wednesday in Jakarta, during the 2016 Indonesia Infrastructure Week.
Not many investors, he added, wanted to invest in greenfield infrastructure projects, which refers to fresh projects, and instead preferred to put their money in brownfield projects, which refers to projects that are already operating and generating cash flow.
National Development Planning Board (Bappenas) head Bambang Brodjonegoro, meanwhile, said it was possible for SOEs to offer a concession-sharing scheme to private investors. The SOEs, for example, could sell shares of their subsidiaries that are in charge of toll-road management.
“They can sell some [portion of shares], like 30 to 40 percent. The SOEs will still own the main concession [for the toll road],” he said.