Passenger capacity at Soekarno-Hatta International Airport, Indonesia's busiest airport located just outside Jakarta, is targeted to reach 61 million (per year) by the end of 2017, up 84 percent from a passenger capacity of 33 million passengers currently. Passenger capacity at the airport will rise strongly after the full completion of construction of Terminal 3 as well as the renovations at Terminals 1 and 2. Although Terminal 3 opened in August 2016 construction will continue into 2017 when full passenger capacity (25 million per year) is expected to be reached.

Read more ›

The Indonesia Toll Road Authority (in Indonesian: Badan Pengatur Jalan Tol, or BPJT), which is a department within Indonesia's Ministry of Public Works and Housing, says there are 11 investors that compete for four toll road projects. Combined, these four projects are estimated to have a total value of IDR 41.5 trillion (approx. USD $3 billion). The 11 investors - all having passed the prequalification process - are requested to send their proposals for the tender process. Before the end of 2016, the Indonesian government is expected to announce the winners of the tenders.

Read more ›

On Tuesday (09/08), Terminal 3 of the Soekarno-Hatta International Airport, located just outside Indonesia's capital city of Jakarta, becomes operational. This IDR 7.7 trillion (approx. USD $588 million) terminal is designed to have the capacity to handle some 25 million passengers per year. In the first phase of the terminal's operations, national flag carrier Garuda Indonesia will use it for its domestic flights (about 126 per day). Gradually, Garuda will serve international flights from this terminal, followed by international flights of other airlines.

Read more ›

Next week construction of the high-speed Jakarta-Bandung railway project may finally start as the government is set to issue the necessary construction permit that allows for the development of Indonesia's first-ever high-speed railway project. This railway will connect Indonesia's capital city of Jakarta to the city of Bandung in West Java. Although the groundbreaking ceremony was conducted in January 2016 the project - similar to many other infrastructure projects in Indonesia - has been plagued by a long delay.

Read more ›

Since the groundbreaking ceremony on 10 October 2013, witnessed by then-Jakarta Governor Joko Widodo, the Mass Rapid Transit (MRT) project in Indonesia's capital city of Jakarta has made progress. According to the latest updates, the first phase of the North-South line has been completed for slightly over 50 percent per July 2016. This first phase, which is estimated to require USD $1.5 billion worth of investment, connects Lebak Bulus in South Jakarta to Bunderan Hotel Indonesia in Central Jakarta.

Read more ›

Domestic cement sales in Indonesia climbed 3.1 percent year-on-year (y/y) to 29.48 million tons in the first half of 2016. Widodo Santoso, General Chairman of the Indonesian Cement Association (ASI), said rising cement demand in Indonesia is particularly supported by the construction of power plants, smelters and other infrastructure projects outside the island of Java. However, he added that the cement sales growth figure in H1-2016 is slightly below the target of ASI.

Read more ›

Despite the Indonesian government being eager to push for infrastructure development, Southeast Asia's largest economy fell 10 positions in the World Bank's 2016 Logistics Performance Index (LPI), from 53rd position in 2014 to 63rd position this year. The LPI is determined through a worldwide survey involving operators on the ground (global freight forwarders and express carriers) that provide feedback on the logistics in nations where they operate and those with which they trade. High logistics costs are a problem for any economy as it makes products and services less competitive, while foreigners will think twice before investing in the country.

Read more ›

There are 30 projects that have been selected as priority infrastructure projects in Indonesia for the period 2016-2019. In total, all these projects together will require some IDR 5,519 trillion (approx. US $415 billion) worth of investment. However, the Indonesian government (including state-owned enterprises and regional governments) can only come up with IDR 1,400 trillion, or 26 percent of the required funds. The remainder therefore needs to be covered by the private sector. As such, the key for success is fruitful cooperation between the private and public sector (for example through public-private partnerships).

Read more ›

The central government of Indonesia has officially declared the Patimban Seaport project in Subang (West Java) a national strategic project through Presidential Decree No. 47/2016, signed by Indonesian President Joko Widodo. This declaration implies that the project is regarded a priority project that benefits the economy and society as a whole. The priority status further means that all ministers, government agencies and governors need to support the development of the project.

Read more ›

Indonesian Minister for Public Works and Housing Basuki Hadimuljono doubts that construction of the Trans-Sumatra toll road will be completed by 2019. The minister already informed Indonesian President Joko Widodo about his concern. As usual, the main issue that forms a time-consuming matter in infrastructure projects in Indonesia is land acquisition. And while land prices on Sumatra are relatively cheap, the sheer size of land that needs to be purchased for this toll road makes it a challenging process. Regarding the Trans-Java toll road, on the contrary, Minister Hadimuljono says completion by 2018 is possible.

Read more ›

The position of consultant, tasked to conduct a feasibility study for the Jakarta-Surabaya toll road, will be tendered in early 2014. The realization of the Jakarta-Surabaya toll road, a 775 kilometer-long toll road that is built above the sea (along the coast line between Jakarta and Surabaya), is an ambition of the Indonesian government and expected to ease the difficulty of transportation on Java, Indonesia's most populous island. The feasibility study should explore the technical and environmental framework related to the establishment of the toll road.

Read more ›

According to the Indonesian Cement Association (ASI), cement sales in Indonesia reached 41.6 million tons in the first three quarters of 2013, a 5.3 percent increase compared to domestic cement sales in the same period in 2012 (39.5 million tons), while Indonesia's cement exports jumped by 187 percent to 503 thousand tons. As such, total cement sales from January to September 2013 grew 6.2 percent to 42 million tons. Meanwhile, Semen Indonesia, Indonesia's largest cement producer, managed to expand its market share.

Read more ›

Although initially expected to start in 2015, the government announced that construction of the new Karawang airport (in West Java) may commence in 2014. The administrative process (including a spatial plan review) is near completion, thus clearing the way for the airport's groundbreaking. The Karawang International Airport, which is designed to have a passenger handling capacity of 70 million people per year, will be built on a 900 ha piece of land and is envisaged to relieve passenger and flight congestion at Soekarno-Hatta International Airport.

Read more ›

After a decade of high growth and a swift rebound after the collapse of US investment bank Lehman Brothers, emerging markets are seeing slowing growth. Their average growth is now 1½ percentage points lower than in 2010 and 2011. This is a widespread phenomenon: growth has been slowing in roughly three out of four emerging markets. This share is remarkably high; in the past, such synchronized and persistent slowdowns typically have only occurred during acute crises.

Read more ›

In order to improve Indonesia's intra-island connectivity on Java (and thus reduce logistics costs that are due to fragile infrastructure), the government is planning to build a toll road above the sea from the capital city of Jakarta in the western part of Java to Surabaya in East Java. Both these cities are Indonesia's centers of industrial productivity and economic growth. The 775 kilometer-long toll road, which is expected to cost about IDR 150 trillion (USD $13.3 billion), will be build by a consortium of 19 Indonesian state-owned enterprises.

Read more ›

Softer than expected economic activity in the People’s Republic of China (PRC) and India and jitters over the United States (US) quantitative easing (QE) program will weigh on Asia and the Pacific’s growth prospects in the near term, says a new Asian Development Bank (ADB) report. “Asia and the Pacific's 2013 growth will come in below earlier projections due to more moderate activity in the region’s two largest economies and effects of QE nervousness,” said ADB Chief Economist Changyong Rhee.

Read more ›

Growth rates in Indonesia in 2013 and 2014 will fall below earlier projections, highlighting the need to continue improving the country’s competitiveness in manufactured exports, says the Asian Development Bank (ADB) in an update of its flagship annual economic publication, Asian Development Outlook 2013. ADB revised down its 2013 gross domestic product (GDP) growth forecast for Indonesia to 5.7% from 6.4% seen in April. For 2014, growth will also be adjusted to 6.0% from the previous estimate of 6.6%.

Read more ›

After China and India, Indonesia is currently the third most important investment destination for Japanese investments in the manufacturing sector. In 2011, Indonesia - Southeast Asia's largest economy - was still ranked number five on that list. However, in recent years the country managed to surpass Thailand and Vietnam. This fact indicates the important link between Indonesia and Japan. The chief executive officer of the Japan Bank for International Cooperation (JBIC), Hiroshi Watanabe, confirmed these findings.

Read more ›

According to data from the Indonesian Cement Association (ASI), domestic cement sales have fallen 5.8 percent to 3.3 million tons in August 2013 (from the same month last year). Being an important indicator of economic expansion (as cement sales inform about the development of property and infrastructure projects in the country), these lower cement sales confirm the slowing pace of economic growth in Indonesia. Compared to July 2013, cement sales in Indonesia fell by a massive 32 percent.

Read more ›

In its most recent report regarding Indonesia's economy, the World Bank states that high logistic costs form a serious impediment to the country's economic growth. The report, titled Annual Logistics Report, is compiled by Bandung Institute of Technology’s Research Center for Logistics and Supply Chains, the Indonesian Logistics Association (ALI), the STC Group, Panteia Research Institute, and the World Bank Indonesia Office. The report provides an analysis and overview of the progress made in tackling the problem of logistics in Indonesia.

Read more ›