Indonesia has immense potential and ambitions as an emerging-market superstar, but is stymied by basic infrastructural potholes. Choked roads, overcrowded ports and unstable electricity supply make it difficult for businesses to operate as well as move their products. But Indonesia plans to change all that in the next five years.
The government intends to step up the building of modern infrastructure, pouring billions of dollars into new roads, ports and electricity networks as part of a push to eradicate the main bottlenecks that stand in the way of the country’s economic growth.
A long-awaited law allowing the government to acquire land for public use more easily will be passed this year.
The plans were laid out by Indonesian President Susilo Bambang Yudhoyono this week, in a rare interview with The Straits Times.
“In the next five years or so, we will be able to accelerate the process of our infrastructure building,” he said. “It is strongly needed for improving our investment.”
It was an upbeat tone that the President maintained throughout the wide-ranging interview, which he gave on the sidelines of a meeting of Asean leaders in Bali this week.
But the Indonesian leader also tempered his optimism about the development plans with an acknowledgment of the many challenges Indonesia faces, including the need to get local politicians on board and to put in place a clear legal framework and “responsive bureaucracy”.
Yudhoyono’s plans come on the heels of an ambitious economic masterplan that he laid out in May, aimed at turning Indonesia into one of the world’s top 10 economies by 2025.
The masterplan is part of his vision of “strong, balanced and sustainable growth”, under which the government wants to draw more investments and promote exports, so that the country can generate revenue to fund more programs for the poor and help small businesses grow with micro-credit and other schemes.
A key plank is to attract US$468 billion (S$ 568 billion) in investments over the next 14 years, including for infrastructure.