Building a Sustainable Partnership

between Indonesia and Japan

October 7, 2014
Makio SHICHIJO
Senior Director, Overseas Project Division, Policy Bureau,
Ministry of Land, Infrastructure, Transport and Tourism (MLIT), Japan
 Past Cooperation between Indonesia and Japan
Kali Konto Multipurpose Dam Dumai Port Development Prioject 2004 Aid in the wake of the Great
Jakarta Ring Road
(1968 - ) (1989 - ) Sumatra-Andaman Earthquake

Brantas River Development Project 2008 Year of Friendship

Semanggi flyover Bali International Airport
（1970～ ） between Japan and Indonesia

Japanese Economic Cooperation to Indonesia

3,000
(100 million yen) (yen amounts)
2,000

1,000

0
1954 1959 1964 1969 1974 1979 1984 1989 1994 1999 2004 2009
6,000
（person） (Numbers of trainees accepted, specialists dispatched)
4,000

2,000

0
1954 1959 1964 1969 1974 1979 1984 1989 1994 1999 2004 2009
1
Proposal for new sustainable relationships with Indonesia
General Relations The New Relationship

individual structures Comprehensive solutions

with hard and soft measures

individual activities
Partnership
(Biz.-Gov.-Academic)

Short-term cooperation Long-term cooperation

only construction construction-operation-maintenance

2
(1) Promotion of
comprehensive solutions,
including hard and soft measures
Concept of Comprehensive Solution with hard and soft measures
Since various infrastructure projects have been implemented individually, the effects of these projects are
limited. To make them effectively, it is important to multi dimensional perspective into infrastructure
developments. In addition, it is crucial to integrate hard and soft measures to enhance an effect .
Individual Projects Comprehensive solutions
Linkage among projects
(original model) with hard and soft measures

Development of highway BRT(Bus Rapid Transit) ETC or Signaling System

MRT(Mass Rapid Transit) Transportation Hubs Park & Ride Land use control

4
Promotion of the Jakarta Metropolitan Priority Area Plan
・To maintain infrastructure in the Jakarta Metropolitan Area in good condition can make the
investment situation better. Officials from both countries committed in 2010 to cooperate with
each other.
・A comprehensive master plan was formulated; early construction work was started by the
end of 2013 to achieve this vision, and priority work was promoted to be completed by 2020.
JABODETABEK MPA PROGRAMS to achieve GOALS
Development Vision 2030 ・New Urban Transport System
・Road Network
WEST
Existing
・Urban Re-development
Gateway
Soekarno
Hatta
NORTH ・Water Supply and Sewerage Systems
・Waste Treatment
Airport Tanjung
Priok
Port Existing
Tangerang
Tangerang
Gateway
・ Flood Management
Selatan
Jakarta Proposed
Gateway
・New Growth Sub-Corridor
・New Academic Research Cluster
Cilamaya
New Port ・Cilamaya Port
Depok
Bekasi
Bogor ・Tanjung Priok Port
・ Road/Railway along New Growth Sub-
SOUTH Proposed
Gateway Corridor
Karawang
EAST ・New International Airport
・Soekarno-Hatta International Airport
Source: MPA Development Vision 2030 approved by
Steering Committee on 22 September 2011 ・Low-carbon Power Supply
・Smart Grid 5
Examples of Comprehensive Solutions (Traffic Congestion)
Urban Traffic Congestion in Jakarta

Modal Share of Train 2%

<Increase of Vehicle>
two-wheeled 4.6 fold

four-wheeled 2 fold from 2010 to 2014

Use of rail in comparison with other cities Congestion in Jakarta

＜Hard measures＞ <Soft measures>

Road Encourage Smooth Flow
- Highways,Overpass of Traffic
construction, improvement - ETC (Non-stop toll
collection), Traffic signal
system,Improve capacity of traffic
Public Transport direction by police
- MRT
- high-speed bus transport system
Land-Use Control
- Manage traffic demand through
Transport Hubs control of land use etc.
- Park & ride facilities,Facilities to
house stores away from roads etc

Traffic Demand Management

-ERP, Road information signs etc.
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Japan-Indonesia Vice-Ministerial Meeting on Infrastructure development
Memorandum of Cooperation
completed with Ministry of
Public Works
・Date: Monday, September 9, 2013
・Fields of Cooperation:
(1) water resources, flood and erosion
control, drinking water; (2) sewage
treatment and storm drainage ; (3) roads
and bridges; (4) building construction; (5)
spatial planning; (6) disaster management
・Cooperation details:
(1)information exchange through workshops
etc., (2)research surveys conducted by
dispatched experts.
Signing the memorandum
1st Japan-Indonesia
Vice-Ministerial Meeting
on infrastructure development
Date: Monday, September 9, 2013
Place: Ministry of Public Works in Jakarta
・Plenary Meeting
(1) Infrastructure in underground space
(2) LCC/sustained management of public
infrastructure
(3) Disaster Management
・Working Group
(1) Road, (2) SABO
(3) Water resource management
(4) Sewage,(5) Building
Vice-Ministerial Meeting (plenary meeting)
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(2) Partnerships
among business, academia and government
that create synergistic effects
Creation of synergistic effects by partnerships among business, academia and government

Match technologies/solutions with needs/challenges through various occasion for dialogues

among decision makers and resource persons

Conventional Collaboration Proposed Framework

Governments
(Decision Makers)

Gov. <Government collaboration...> Gov. G

○Full understandings of needs in gov't. sectors

X ×Lack of latest business ideas / solutions

×Frequent personnel changes
A
G

Biz. <Exhibition, Business negotiation...>

Biz. Academics
○Business ideas and solutions (Resource Persons)
×Limited information on needs in gov't. sectors.
X ×Limited connection to governments
P
A
Aca-<Academic Conference, Joint research...>Aca- Private Sector
deme deme
P (Resource Persons)
○Cutting-edge scientific knowledge and idea
○Continuity of personal network
×Gap with practical needs

9
Disaster Management Collaboration Dialogue (DMCD)
Framework
Start the dialogue focusing on sharing challenges and finding solutions related to disaster
management. Make synergies through the collaboration of 3 sectors (gov./biz./academe)
of both countries.

Disaster Management
Gov. Collaboration Dialogue Gov.
-Identify challenges in disaster
management by combining local
knowledge and experience of
Biz. Aca- experts.
Biz. Aca-
deme -Focused on finding better deme
solutions through the
*Seek to make synergies with the collaboration dialogue. *Seek to make synergies with the
combination of three sectors combination of three sectors

Seek to enhance disaster management by;

-Learning from each other on needs/challenges and technologies/solutions,
-Enabling effective cooperation fitting real needs in major disasters,
-Constructing a continuous human network of resource persons and decision makers.
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(3) Long-Term Cooperation,
Including Operations and Maintenance Phase
Increasing PPP infrastructure projects

Infrastructure investment Transport PPP investment

(B$)
6
60
Worldwide $2,300B/year 5
50
Source：OECD （2006, 2011）
4
40 Others
3
30
Central /
2 South America
20
Asia $800B/year 1
Asia
Source：ADB（2009） 10
0

(year)

Source: World Bank

PPP becoming key method for infrastructure development

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Japan’s transport and urban development

Safety
Reliability
Life cycle cost
Env. performance

“Japan Solutions” ready for use

13
Features of infrastructure projects of Transport and Urban development

Infrastructure project
Risk of Infrastructure project
revenue generation

Demand Large initial costs

3

Construction Revenue
period 2
2 Time
long-term
investment revenue
Start Surplus through
accumulated
revenue
1
Single year 3
budget surplus
demand risk

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Benefits of a Long-Term Partnership through PPP Projects

1
Capital Procurement ・Maintenance and construction is possible
by the Private Sector despite the financial status of a government

2
Partnership Actors
in Construction and ・Clear attribution of liability for defects
Maintenance Phases

3
・High-quality construction, and operation and
Reduction of maintenance with a long-term perspective
Life-Cycle Costs ・High initial costs, but low life-cycle costs

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New scheme for promoting PPP projects

Host Japan
country
Companies

Banks
Companies
New Agency
Banks SPC
(PPP etc.) • Government-funded
• Investment capacity:
Government $1B (FY2014)

Other
countries

New government-funded agency ― established within 2014.Oct.20

Japan Overseas Infrastructure Investment Corporation

for Transport & Urban development （JOIN）
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Partnership with ODA Project by Government

Japanese JBIC、NEXI、 Partner Country

Companies JOIN companies/government

Investments etc. Investments etc. Investments etc.

Port Operator
Private

Loading equipment
運営
Operation
Team Japan Customs
Roads
Seawall/Groin Bridges
Dredging Machinery
housing
Reclamation
Infrastructure improvement

Partner Government
Public
Yen Loan
Japanese Government(JICA)
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“Triple-Win” proposal

Development

Host
Country

Our
Japan
World

Investment Prosperity

Good for you, good for us, good for all

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In Conclusion
General Relations The New Relationship

individual structures Comprehensive solutions

with hard and soft measures

individual activities
Partnership
(Biz.-Gov.-Academic)

Short-term cooperation Long-term cooperation

only construction construction-operation-maintenance

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Terima kasih banyak

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