Gap Financing Infrastructure Reaches IDR 1,435 Trillion, KPUPR Proposes These Three Strategies

JAKARTA - The Ministry of Public Works and Public Housing (KPUPR) held Creative Infrastructure Financing Day entitled "3 Bold Actions: Breakthrough Closing Infrastructure Gap Funding" at the Jakarta PUPR Ministry Building Auditorium, Wednesday, December 13.

According to the theme, the event was held to discuss three strategies in overcoming the infrastructure financing investment gap for the 2020-2024 range, which was IDR 1,435 trillion.

The Ministry of PUPR noted that investment needs for the public work and housing sectors in the 2020-2024 period reached IDR 2,580 trillion.

Meanwhile, the APBN funds allocated for this sector can only meet 30 percent, which is Rp. 623 trillion. Thus, there is a funding gap of Rp. 1,435 trillion or about 70 percent of the total needs.

PUPR Minister Basuki Hadimuljono admitted that he did not really understand the 3 Bold Actions strategy that had been designed by the Directorate General of Infrastructure Financing (DJPI) of the Ministry of PUPR.

"I myself don't know what 3 bold actions are, I want to hear that," said Minister Basuki.

There are a number of elements of agencies involved in discussions, such as from the Indonesia-Australian Partnership for Infrastructure (KIAT), the Supreme Audit Agency (BPK), to the Directorate of Government Support Management and Infrastructure Financing (PDPPI) of the Ministry of Finance (Kemenkeu).

The concept of 3 Bold Actions initiated by the Ministry of PUPR includes the first Fast Track PPP. This is done to speed up the KPBU process while maintaining the quality of the resulting documents and standardization of the required documents.

Second, provide investment certainty that can be made through the expansion of infrastructure guarantees, VGF, Hybrid Annuity Model, and minimum/Minimum Revenue Guarantee (MRG) revenue guarantees.

Third, the implementation of ESG in response to the challenges of climate change and also oriented towards green financing.