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Big 5 Indonesia Ayik Candrawulan Gunadi Presentation 31102016
Big 5 Indonesia Ayik Candrawulan Gunadi Presentation 31102016
in Indonesia
Ayik Candrawulan Gunadi
- The Big 5 Construct Indonesia Workshops
10 November 2016
TTTTOPICS
SESSION TOPIC
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Brief introduction on the PPP
program in Indonesia
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
Hybrid financing: GCA can finance some part of the PPP project
which is expected can add some funds for the business entity.
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BRIEF INTRODUCTION
Land acquisition: Pursuant to PR 38/2015 and in accordance
with the laws applicable in land procurement for public
interest, private entities can now initially fund the land
acquisition on behalf of the government entity. Further, these
funds will be repaid by the government entity through return
of investment pursuant to an agreement. Only after the
stipulation of the location of the project has been completed,
then the procurement process will be implemented. Moreover,
in the event the BUMN/BUMD acts as the authority in charge,
the source of the fund will come from: (i) internal budget of
the said BUMN/BUMD, or (ii) cooperation between the said
BUMN/BUMD with the developer
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
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BRIEF INTRODUCTION
Investment return: Based on PR 38/2015, the private sector
partner will receive a return on investment in 3 (three)
forms, namely: (i) tariff scheme, (ii) availability payment, or
(iii) other forms provided by other laws and regulations. In
budgeting the funds for availability payment, the GCA will
take into account the capital and operations costs and
profits of the business entity over a defined period. Further,
the availability payments are payable based on the
availability of the services. However, the exact type of
infrastructure project that may use the availability payment
method remains to be further clarified.
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BRIEF INTRODUCTION
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Assessing the role of private
sector in achieving development
targets through PPP frameworks
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ROLE OF PRIVATE SECTOR
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Understanding the key
characteristics of government
projects
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GOVERNMENT PROJECTS
Based on the PPP Book 2015, Indonesian
Government prepares the projects based on the
3 criteria:
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GOVERNMENT PROJECTS
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Overview of common challenges,
regulatory discrepancies and
dynamic market factors facing the
construction industry
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COMMON CHALLENGES
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COMMON CHALLENGES
Indonesia lacks adequate physical infrastructure
railways, airports, ports, and roads to facilitate
substantial trade flows. It is one of the countries in
ASEAN with the highest costs for exporting goods.
Similarly, its regulatory framework restricts
development in trade and investment. For example,
restrictions on foreign investors exist in logistics
services and maritime transportation in the form of
joint-venture requirements and a maximum foreign
ownership allowance of 49%.
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COMMON CHALLENGES
Corruption has long been recognized as an endemic
problem in Indonesia, as exemplified by the establishment
of the Indonesian Corruption Eradication Commission (KPK)
a decade ago. In recent years, the fight against corruption
has intensified as evidenced by the unprecedented number
of judges, government officials, legislative members, and
even police officials who have been brought to justice.
However, this has not improved Indonesias ranking in the
Corruption
Perception Index, which slipped 14 places in 2013 to 118th
compared to its rank in 2011.
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COMMON CHALLENGES
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Assessing PPP opportunities
through a risk-driven approach
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RISK ASSESSMENTS
Site risk is the risk that the project land will be unavailable
or unable to be used at the required time, in the manner or
at the cost anticipated, or that the site will generate
unanticipated liabilities.
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RISK ASSESSMENTS
Sponsor risk is the risk where the project company and/or its sub-
contractors are unable to fulfill their contractual obligations to the
contracting agency.
Financial risk is the risks related to financial viability aspects of the
project.
Operating risk is the risk that the process for delivering the
contracted services or an element of that process (including the
inputs used within or as part of that process) will be affected in a
way which prevents the project company from delivering the
contracted services according to the agreed specifications and/or
within the projected costs.
.
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RISK ASSESSMENTS
Revenue risk is the risk that the project revenue is unable to meet the
projected level of financial viability, due to the unexpected changes to
either the project demand or the agreed tariff or combination of both.
Force majeure risk is the risk that a specified event entirely outside
the control of either party (e.g. act of god, man-made catastrophic
event) occur and will result in a delay or default by the project
company in the performance of its contractual obligations.
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Q&A
Thank you
- The Big 5 Construct Indonesia Workshops
10 November 2016
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