|
With the government jacking up spending for infrastructure
projects for next year and beyond, Indonesian constructors are facing
stiff challenges from their regional peers who are also keen to enter
the country's lucrative infrastructure sector.
"Indonesian construction service providers must anticipate the market
opportunity. Otherwise, companies from neighboring countries will grab
it," head of the national construction service development agency
Malkan Amin said Tuesday, as reported by Antara.
The agency provides consultancy services both to the government and
business players in the sector.
The government has decided to raise the 2008 infrastructure budget
allocation by 60 percent. As a result, a number of ministries have
allocated a large amount of funds for the sector for next year.
For example, the Public Works Ministry will disburse Rp 35 trillion for
infrastructure projects such as turnpikes, roads and bridges, while the
Education Ministry is planning to spend Rp15 trillion to rehabilitate
schools nationwide.
Malkan added that the projects would be worth much more as the
construction services provided by the private sector are usually worth
more than those of the government.
Therefore, Malkan added, foreign constructors from neighboring
countries, including Malaysia and Singapore, were looking for a piece
of Indonesia's construction pie.
While many local construction companies are less equipped with advanced
technology than their foreign competitors, Malkan said this could be
addressed by creating joint ventures with other local or foreign
companies.
Under existing regulations, foreign constructors must partner with
local companies in any construction projects financed by the state
funds.
"It is actually to protect the local players so that we don't become
spectators," Malkan said of the regulations.
|
