Estimated Not To Be Finished Until 2024, The Government Will Remove 10 Projects From The PSN List

Coordinating Minister for Economic Affairs, Airlangga Hartarto. (Irfan Meidianto / VOI)

JAKARTA - The government has decided to exclude 10 projects from the list of National Strategic Projects (PSN) because they are not expected to be completed until 2024. Currently, there are also hundreds of new project proposals that have been submitted to the government table.

Coordinating Minister for Economic Affairs (Menko Ekonomi) Airlangga Hartarto said that currently there are 232 new project proposals. The details are, 84 project proposals came from five Ministries, 123 project proposals came from 13 Regional Governments, 17 project proposals came from 4 BUMN / BUMND, and eight project proposals came from the private sector.

"Based on the evaluation of the PSN implementation, there are nine PSNs and one program whose completion exceeds 2024 so that they are excluded from the PSN list," he said, in a written statement received by VOI, in Jakarta, Thursday, April 16.

Airlangga revealed, until December 31, 2019, as many as 88 percent of PSN had passed the preparation stage, including those related to the 35,000 MW electricity program and the Economic Equity Policy Program.

"Meanwhile, 12 percent (the rest) is still in the preparation stage, including the aircraft industry program," he said.

Previously, Airlangga together with the Coordinating Minister for Maritime Affairs and Investment (Menko Marves) Luhut Binsar Panjaitan and a number of Working Cabinet Ministers held a Coordination Meeting (Rakor) to finalize the PSN Proposal List, on Wednesday, April 15.

Luhut said the meeting was to see which projects could be funded by the private sector. So, the development does not only depend on the state budget.

According to Luhut, with the PSN status, private investment projects that have been experiencing problems can be resolved immediately. So that it can absorb labor and generate foreign exchange.

"I hope we can be faster even in a situation like this," said Luhut.

Proposed PSN List

Plt. Deputy for Investment and Mining Coordination of the Coordinating Ministry for Marves, Septian Hario Seto, said that his party had coordinated with the Commission for the Acceleration of Priority Infrastructure Development (KPPIP) regarding several project proposals that were evaluated in terms of funding, aspects of investor capacity, impact on the economy, and spatial aspects.

"(All) have met the PSN criteria," he said.

Seto said the first proposal was the Obi Island Industrial Zone. The number of workers from Indonesia was 1,978 people. Currently, the RKEF phase 2 smelter design has an estimated investment of around US $ 800 million.

Previously, Seto said that in this area there was a Phase 1 RKEF Smelter which had been operating since 2016. According to him, the majority of investors in this project came from domestic investors, namely the Harita Group.

"However, a significant development is the HPAL (High Pressure Acid Leaching) Smelter, construction is almost complete, it is estimated that the third quarter of 2020 will operate. The smelter products are MHP (Cathode Lithium Battery), Nickel Sulfate, and Cobalt Sulfate. estimated to be around 1 billion US dollars, "he explained.

The second proposal is for Weda Bay Industrial Park. Seto said, if there were no COVID-19 problems, the operation for the smelter should be inaugurated in April 2020. The total investment plan for this year is around 4 to 5 billion US dollars.

"The share of exports from phase 1 is quite significant, namely by 2024 it is estimated to reach US $ 2 billion. If it is fully invested that year, we estimate the value could be much higher," he said.

Seto said that the Obi Island Industrial Zone and the Weda Bay Industrial Park are the two industrial areas that have been included in the category that can be considered in the PSN. "If you wish, we will ask for both of them to be completed with their shortcomings to be included in the PSN project list," he said.

In addition, Seto revealed, there are nine other proposed projects that have been evaluated to ensure investors who invest in the project have the financial capacity and execution to realize the project and can be completed before 2024.

The nine projects consist of six smelter-related projects, one coal processing project into methanol in East Kalimantan, the Methanol Industrial Estate project, and the construction of the Kediri-Tulungagung toll road.

"Regarding the PSN proposal mentioned above, the Coordinating Minister for Marves and the Coordinating Minister for the Economy to further complete the lack of documents, and to re-examine the needs of each of the proposed projects in relation to the PSN status," he said.