Infrastructure

A result of decades of underinvestment, creaky infrastructure has long been the Achilles’ heel of the Indonesian economy. Around $6.8bn will be spent on power and some $29bn on water utilities and other services under the Master Plan for the Acceleration and Expansion of Indonesia’s Economic Development. The government is expected to fund 28% of the cost, with the rest coming from the private sector. The government aims to meet 2% of the country’s power demand from nuclear energy by 2017. In February 2014 it confirmed plans to build a 30-MW nuclear power plant in western Java. Although private sector involvement in water services remains limited to date, the government has envisaged that nearly 70% of water infrastructure investments between 2010 and 2014 will come through public-private partnerships, community participation and the private sector. Improving infrastructure will continue to be a priority with Indonesia’s sovereign rating upgraded to investment grade and its economy growing at a steady pace. This chapter contains interviews with Djoko Kirmanto, Minister for Public Works; Stuart Dean, CEO, General Electric ASEAN; and Bobby Umar, Chairman, Indonesian Engineers Association.