Realizing International Standard Port Development
Transcription
Realizing International Standard Port Development
24 Strategic Ports Supporting Marine Highway PARTNERSHIP SUSTAI NI NG Marine Transportation Edition | 2015 I N F O R M AT I O N M E D I A F O R G O V E R N M E N T A N D B U S I N E S S E N T I T I E S C O O P E R AT I O N ISSN 2 0 8 8 -9 1 9 4 9 772088 919408 PPP’s Scheme: Realizing International Standard Port Marine Highway, Realizing Logistics Distribution Connectivity Editorial & Publishing Editorial Uniting Indonesian Archipelago by Marine Infrastructure PUBLISHING STAFF CHAIRMAN Acting as Director of Public Private Partnership Development, The National Development Planning Agency (Bappenas) CHIEF EDITOR Jusuf Arbi BOARD OF EDITORS Delthy Sugriady Simatupang Gunsairi Rachmat Mardiana Novie Andriani Dodi Sulistio Ahmad Yudistira Eka Masropah Christiaan R. Rudolph Ajeng P. Anggita Elisabeth Ria MANAGING DIRECTOR R Indra EDITOR Thomas P Kandi Agus S REPORTER Elmy Diah Larasati Dewi Sulistiawaty Andi Nur Azisa PHOTOGRAPHER Ponco GRAPHIC DESIGNER Afandi A, Dica H Translator Farida Contact address Infrastructure Reform Sector Development Program (IRSDP) BAPPENAS Jl. Jambu No.35, Jakarta 10310 website: www.irsdp.org Telp. (62-21) 31925392 Fax. (62-21) 31926438 T ransportation has a very important role in supporting national economic growth and improving the competitiveness of Indonesia in the era of free markets, especially with the enactment of the Asean Economic Community. Indonesia as a maritime country realizes that marine transportation has strategic value. That is why the government focused on the development of marine highway which is capable of connecting all regions of Indonesia. Marine highway is one of implementations of President Joko Widodo’s Nawacita, in the form of sea connectivity effectively with the existence of the ships that sail regularly from western to eastern Indonesia. Jokowi also has expressed the idea of Indonesia to become the world's maritime pivot, since Indonesia is located between two oceans, the Indian Ocean and the Pacific Ocean as well as the two continents, Asia and Australia, which caused Indonesia to have a strategic position in the maritime world. If the development of infrastructure especially implementation of accelerating marine highway or sea connectivity can be done well, it will be able to unite theindonesian archipelago by sea lanes. Based on the documents of the National Medium Term Development Plan (RPJMN) 2015-2019, for the development of national connectivity to achieve a balance of development, the government has set a target of enhancing 24 strategic ports to support marine highway. The availability of marine highway infrastructure is expected to create a balance national development, streamline national logistics distribution, and also reduce the price disparity between the western and eastern Indonesia. The existence of ports in Indonesia in quantity and quality are still experiencing inequality between the western and eastern Indonesia. In the future, the government needs to trigger the growth of equitable development of ports in all regions of Indonesia. Therefore, the government should continue to encourage the acceleration of infrastructure development, especially inter-island connectivity, since two-thirds of Indonesia consists of sea. The construction of a number of strategic ports to support the concept of marine highway has been announced by the government to be implemented immediately. The port consists of an international hub port, the main port, and the collector port. However, the government encountered the situation of the State Budget and Local Government Budget constraints. Therefore, the role of business entity is highly expected to establish and develop the infrastructure of marine transportation. Investors are expected to build and develop infrastructure of marine transportation with schemes of Public Private Partnership (PPP). Hopefully the marine infrastructure provision can be realized immediately to unite the archipelago sea lanes. (*) 2 | Sustaining Partnership Marine Transportation Edition | 2015 Contents 18 PPP’S PROJECTS PROFILE Kuala Tanjung Port is Ready to Serve the World High logistics costs in traffic flow of commodities and services through landline makes the government of President Joko Widodo’s era keep developing. 4 HEADLINE NEWS Marine Highway Program in supporting Indonesia as the of World’s Maritime Pivot 22 REPORTAGE Marine highway, Realizing Distribution Logistics Connectivity As a maritime country that has the widest sea area and the second longest coastline in the world, Indonesia needs a breakthrough to maximize the potential of the region which is rich in fisheries potential, marine tourism, energy supply, and has a strategic shipping lanes that can be used as a basis for the development of Indonesia as the world’s maritime pivot. 14 INTERNATIONAL PPP The price disparity of commodities to eastern Indonesia is arguably lame compared to western Indonesia. Port Development through PPP Scheme in India 26 India has 7,517 km coastline. Aware of the length Of the coastline, the government built a supporting infrastructure of marine transportation. FIGURE Director of Transportation, Ministry of National Development Planning (PPN) / Bappenas, Ir. Bambang Prihartono, MSCE Required Technical Guidelines in the Implementation of PPP PPP scheme is an integral part of the infrastructure because it is one of the alternatives in infrastructure financing. Marine Transportation Edition | 2015 Sustaining Partnership | 3 Headline News Ships in the Launching of Marine Highway Program. Marine Highway Program in Supporting Indonesia as the World’s Maritime Pivot By: Pandu Pradhana, Planning Staff in the Directorate of Transportation, the Ministry of National Development Planning / Bappenas A s a maritime country that has the w idest sea area and the second longest coastline in the world, Indonesia needs a breakthrough to maximize the potential of the region which is rich in fisheries potential, marine tourism, energy s upply, and has a strategic shipping lanes that can be used as a basis for the development of Indonesia as the world’s maritime pivot. The breakthrough of marine highway programs developed by the government of this period is the elaboration of sea transportation route planning, subsidizing marine transportation, public shipping revitalization, and the development of regional commodity-based industries. Commemoration of the first year of government of President Joko Widodo was marked by the launching of one of marine highway programs. The departure of Caraka Jaya III-22 Motor Ship from Tanjung Priok 4 | Sustaining Partnership Marine Transportation Edition | 2015 Port, Jakarta and Caraka Jaya Niaga III-32 Motor Ship from Tanjung Perak Port, Surabaya were conducted on November 4, 2015. The two ships owned by PT. Pelayaran Nasional Indonesia Persero (The National Shipping Company of Indonesia) carried 41 and 36 containers for the journey to the eastern Indonesia. For the implementation of the marine highway program, the Ministry of Transportation assigned the PT. Pelayaran Nasional Indonesia (Persero) through Presidential Headline News Regulation Number 106 Year 2015 on the Implementation of Public Service Obligation for Freight Transportation in the Context of the Implementation of the Marine Highway and the Regulation of the Minister of Transportation No. PM 161 Year 2015 on the Implementation of Public Service Obligations for Marine Freight Transportation as well as the Regulation of the Minister of Communications No. 168 2015 on the Rates of Domestic Freight Transportation and Stevedoring in the Context of the Implementation of the Marine Highway. Marine Highway is one of the implementations of President Joko Widodo’s Nawacita, which is in form of effective marine connectivity with ships sailing regularly from western to eastern Indonesia. Marine highway is expected to build a national connectivity to achieve the balance of the national development, to make national logistics distribution more efficient, and to reduce the price disparity between the western and eastern Indonesia as well. The World’s Maritime Pivot and the Implementation of Marine Highway We can say that the improvement of Indonesia's ranking in the Global Competitiveness Index announced by the World Economic Forum for the past few reports is the result of the government’s effort in providing basic infrastructure. The government's priority in infrastructure development also improves the Indonesia’s connectivity index ranked in the transportation sector, particularly the marine transportation sector. President Joko Widodo conveyed the idea of Indonesia to become the world's maritime pivot in the 9th East Asia Summit (KTT) in Myanmar in November 2014. Indonesia which is located between two oceans, the Indian Ocean and the Pacific Ocean as well as the two continents, Asia and Australia has a strategic position maritime world. It is estimated that about 90 percent of international trade using marine transportation, while 40% of the international trade route passes through Indonesia. Supported by three Indonesian Archipelagic Sea Lanes (ALKI) which is an "aisle" of world maritime traffic, Indonesia has the potential to realize the target of becoming the world's maritime pivot. The five main pillars of the development agenda to support the realization of Indonesia as the world's maritime pivot such as: 1) rebuilding the Strategic Ports Supporting Marine Highway Source: Report of Implementation of Marine Highway Concept 2015-2019 Marine Transportation Edition | 2015 Sustaining Partnership | 5 Berita Utama maritime culture of Indonesia; 2) maintaining and managing marine resources; 3) prioritizing the development of maritime infrastructure and connectivity; 4) strengthening maritime diplomacy; and 5) establishing a maritime defense force. The third agenda is focused on the implementation of the marine highway program, the construction of a deep sea port, the development of short sea shipping, the enhancement in the national logistics system, as well as the development of shipbuilding industry. For the implementation of the marine highway program, to achieve the realization of a decrease in logistics costs and economic equalization in 2019 through sea connectivity as the effective distribution backbone, marine highway action plan 20152016 was arranged as follows: a) development of marine highway concept; b) the development of 24 strategic ports; c) the revitalization of public shipping; d) the development of short sea shipping; e) the development of human resources in the marine transportation sector; f) the development of the fleet and shipbuilding industry; g) the development of sub-feeder port and special allocation funds; h) the development of the schedule, the cargo system, the intermodal, and ports; and i) the development of the strategic port hinterland. The concept of marine highway followed up by the Ministry of National Development Planning / Bappenas after President Joko Widodo delivered investment opportunities in the construction of ports in a meeting of AsiaPacific Economic Cooperation (APEC) in China in November 2014, is an integration of the concept of Pendulum Nusantara, MasteIDRlan for the Acceleration connectivity and Expansion of Economic Development Indonesia (MP3EI), the concept of the front and inside of the region, as well as the National Logistics System (Sislognas). The definition of the marine highway emphasized by President Joko Widodo focused more on the strengthening concept of shipping lanes in the eastern Indonesia. Based on the documents of the National Medium Term Development Plan (RPJMN) 2015-2019, for the development of national connectivity to achieve the equitable development has been enacted 24 strategic ports to support marine highway program, which consists of 5 hub ports (2 international hubs and 3 national hubs) and 19 feeder ports. With the enactment of 24 strategic ports, to realize the shipping route or network it required some strategic policies such as: 1) the arrangement of network of marine transportation route or the revision of Decree of existing route; 2) the expansion of the route network, enhancement of service frequency, as well as the enhancement of reliability of the ship for marine transportation and pioneering; 3) the optimization on implementation 6 | Sustaining Partnership Marine Transportation Edition | 2015 of Public Service Obligation (PSO) of marine transportation of passengers and commodities. As for the development of the 24 strategic ports is planned as follows: a) the construction of an international port and a modern large-capacity for exporting various commodities and serves as an International Seaport-Hub as well; b) the dredging of pond and the flow of hub ports at least -12.5 meter to support the use of a Panamax ship which moves with pendulum route; c) an enhancement in the minimum -7 meters on feeder port draft, to support the use of the 3 in 1 ship and / or 2 in 1 ship developed by PT. Pelayaran Nasional (Persero); d) modernization of facilities and unloading equipment of the strategic marine highway port to increase Berita Utama (Ministry of Industry) to improve the capacity and quality of the national shipbuilding industry. the productivity of the port; e) expansion on the application of Indonesia National Single Window (INSW) in preparation for the implementation of the ASEAN Single Windows; and f) restructuring and rationalizing port service rates in order to improve competitiveness. The shipyard construction to support marine highway program needs to be a priority as well. Concerning the loading potential which grows in line with the equalization of regional development supported by improving connectivity, that the potential of ship industry of various types and sizes and maintenance services of ships (shipyards) is very large with a projection up to 1,000 units / year. The recent ability of shipyards reached 200-300 units / year by the number of ships docking around 250 units were concentrated in the western region of Indonesia. The recent Indonesian shipping fleet is dominated by small ships over 25 years old. The situation is caused by the players of shipping services industry tend to buy second-hand ships in order to reduce investment and depreciation costs. Strategic policy of prioritizing the construction of ships in the country needs to be realized to take the chance of rejuvenation and replenishment needs of various types / sizes of ships. It requires the following steps: 1) the construction of a new shipyard which is technologically advanced and efficient in the areas; 2) the preparation of the legal protection to be developed into State Shipyard; 3) incentives and special attention from the government The indications of total financing needs for the implementation of the marine highway program in the medium-term development period in 2015-2019 reached 700 trillion rupiah. The financing is expected to complete the land acquisition, dredging, development of terminals to 24 strategic ports; the development of short sea shipping in Java; the development of general and bulk cargo facilities in accordance with the National Port Master Plan (NRMP); the development of 1,481 non-commercial ports and other 83 commercial ports; multimodal transportation to accomplished marine highway; revitalization of the shipbuilding industry; and procurement of new ships. In the Government Work Plan (RKP) for Fiscal Year 2016, the Ministry of Transport has allocated IDR 34.3 billion to support marine highway which is comprised of IDR 14.9 billion specifically for the development of 24 strategic ports; 13.6 billion in other marine transportation sector; and 5.4 billion in the transportation sector of river, lake and ferry. Government's commitment in securing the marine highway program's annual budget is very important for the sustainability and success of marine highway program implementation in order to achieve the target to be the world’s maritime pivot. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 7 Headline News Tanjung Priok Port 24 Strategic Ports Supporting Marine Highway I n the future, the issue in the transportation sector is predicted to become more complex and has bigger challenges. With the increasing mobility of people and high economic activity to fulfill the daily needs, the marine transportation sector will play a huge role in order to meet those needs. However, the availability of infrastructure to support marine transportation modes is still very limited. Talking about marine transportation certainly cannot be separated from the presence of the port. Therefore, the government keeps encouraging the development of the port, including the construction of new ports. In terms of quantity, there are many ports in Indonesia. Data from the Ministry of Transportation (MoT) shows, current public ports managed by PT Pelindo are 111 locations; public ports managed by Technical Implementation Unit (UPT) - Ministry of Transportation (MoT) are 614 locations; 546 locations of special terminals; and Terminal For Your Own Interests (Tuks) are 795 locations. On the activities of the ports and harbours, there is also significant development of port facilities 8 | Sustaining Partnership Marine Transportation Edition | 2015 Port for a country has an important and strategic role to support the growth of industry and trade, and a business sector that can make a significant contribution to national development. Therefore, in the leadership era of Joko Widodo-Jusuf Kalla, the construction of the port became one of the priority development agenda as outlined in the National Medium Term Development Plan (RPJMN) 2015-2019. so far. In 2004 there were 85 new locations, jumped to 402 locations by 2013, or there was average rising of 22.94% per year. Maintenance activities such as dredging the shipping track to support the realization of smooth traffic in the shipping lanes around the harbour were also increased in term of the volume of 3,267,508 m3 in 2004 Headline News to 8.36451 million m3 in 2013, or there was average rising of 23.78% per year. However, these conditions have not been able to support interregional connectivity as a result of the spread of the ports that have not been evenly distributed throughout Indonesia. The existence of ports in Indonesia in term of quantity and quality are still experiencing inequality between the western and eastern Indonesia. Therefore, the government will push forward the equalization of port development in all regions of Indonesia. Director General of Sea Transportation, Ministry of Transportation, Bobby R Mamahit, said that the government will establish a number of strategic ports consisting of an international hub ports, the main ports, and the collector ports. These ports will connect effectively eastern and western Indonesia without a hitch. At least, in the next five years the government announced the construction and development of 24 strategic ports that are spread from western to the eastern Indonesia. Construction and development of the 24 ports are already contained in RPJMN 2015-2019. A total of 24 ports are divided into hub ports, the main ports, and collector ports that are able to distribute commodities to small towns. These 24 ports are the Port of Belawan / Kuala Tanjung, North Sumatra: Tanjung Priok / Kali Baru, Jakarta; Tanjung Perak Surabaya, East Java; Makassar, South Sulawesi; Bitung, North Sulawesi; Malahayati Aceh Besar, Aceh; Batu Ampar Batam, Riau Islands; Bayur Gulf of Padang, West Sumatra; Jambi; Palembang, South Sumatra; Panjang, Lampung; Tanjung Emas Semarang, Central Java; Pontianak, West Kalimantan; Sampit, Central Kalimantan; Banjarmasin, Kalimantan Barat; Kariangau Balikpapan, East Kalimantan; Palaran Samarinda, East Kalimantan; Pantoloan, Central Sulawesi; Kendari, Southeast Sulawesi; Tenau Kupang, East Nusa Tenggara; Ternate, North Maluku; Ambon, Maluku Utara; Sorong and Jayapura, Papua. Aside of these 24 strategic ports, PT Pelindo is also ready to develop a number of ports managed by the State-Owned Enterprise. PT Pelindo II, for instance, is ready to invest IDR40 trillion to IDR50 trillion until 2018 to finance the project of development and construction of five ports in the country, namely the Port of Sorong, canals of Cikarang Bekasi Sea (BCL), the Port of Tanjung Kijing Riau Islands, Tanjung Carat Palembang , Port of Cirebon, and Port Bojonegara. According to Director of PT Pelindo II, RJ Lino, some of the capacity expansion projects and the construction of the ports began in 2015 and others started in 2016, with an average two years construction period. One of the projects that has been under mounting piles (ground breaking) in October 2015 was the construction of Sorong Port with an investment of IDR 3.5 trillion - IDR 4 trillion. "The dock area is designed to accommodate a capacity of 1 million TEUs. The land acquisition has reached 75%, with the needed area are of 6,000 hectares, "said Lino. Furthermore, the development of the Cikarang Bekasi Sea (CBL) canal project costed IDR3.5 trillion from November 2015. CBL project that combines the Cikarang port terminal with land ports (dryport) is urgent in order to reduce the burden of the Port of Tanjung Priok. Meanwhile, investment in the Port of Tanjung Kijing which will enter the ground breaking phase in December 2015, requires around IDR3 trillion to fund port development on an area of 3000-5000 meters, with the capacity up to 500,000 TEUs. As for the investment of the development of Tanjung Carat Palembang Port, reached around IDR 4 trillion, while the development of the Port of Bojonegara and the Port of Cirebon reached about IDR2 trillion each. To finance these investments, the company will use internal funds and loans in the form of obligation. "We will not use government funds. We have internal funds around IDR19.5 trillion in the form of free cash. The other IDR20 trillion funds needed are from bank loans, obligation and cooperation with investors, "said Lino. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 9 Headline News Towards World’s Maritime Pivot The Quantity and Quality of Human Resources of Marine Transportation Must Be Improved As an archipelagic country, Indonesia should have a lot of Human Resources (HR) in supporting marine transportation. In fact, the numbers of HR in supporting marine transportation is still far from expectations. The quantity and quality of human resources supporting marine transportation also needs to be improved for the sake of vision of the world’s maritime pivot. M inistry of Transportation through the Human Resources Development Agency of Transportation (BPSDMP) in May 2015 released the data related to the shortage in the field of human resources in Indonesian marine transportation reached 7,000 people. The shortage of human resources in the field of marine transportation covers the ship's captain and engine officers. It is also stated that the shortage of sailors is caused by the unbalanced ship development with the development of Indonesian sailors. BPSDM said, Indonesia was only able to create 1,500 sailors. Therefore, the future challenge is improving the quantity and quality of supporting human resources in marine transportation. Moreover, at the same time, the government has a vision of becoming the world's maritime pivot. Safri Burhanuddin, Deputy for Human Resources, Science and Culture Ministry for Maritime said the development of supporting human resource in marine transportation becomes the basis for national development towards the vision of the world’s maritime pivot. "The existence and availability of skilled human resources in supporting marine transportation is absolute, thus the development of supporting human resources in marine transportation should be one of the national maritime development priorities," he said. In his opinion, to build supporting HR in marine transportation in Indonesia, it should start from the High School / Vocational School levels. Then, conducting the standardization of curriculum and the number of teaching hours / practice is needed for every level of education and continued to higher education levels (High Schools / Colleges of related field). Safri admitted that Indonesia still 10 | Sustaining Partnership Marine Transportation Edition | 2015 lacks of the educational facilities of HR in marine transportation. Nautical schools, for example, are still relatively limited. Therefore, it’s not enough to meet the target of the amount of educated employees needed. As for the imbalance of the number of private and government-owned nautical schools are still occurred, this is due to the limited number of students that can be accepted at the nautical schools which are fully subsidized by the government. Meanwhile, the private nautical schools are also highly dependent on the annual number of students enrolled. Beside nautical schools, the educational institution of HR in marine transportation which is considered less is related to the human resources in the field of management of ports, multi-modal transportation management, underwater works technology, marine transportation Headline News limitation of State Budget and the Regional Government Budget. The activity of ships that serve the transportation of commodities and passengers in Sabu Raijua Port, NTT. Indonesia still needs a lot of human resources in sea transportation to support the vision of the world’s maritime pivot. technologies technologies. and other It is expected that the infrastructure development of educational facility in marine transportation sector can be done on a massive scale to support the vision of the world’s maritime pivot. The infrastructure development of educational facility in marine transportation is conducted using the State Budget, Regional Government Budget or through Public Private Partnership (PPP). According to him, the Government highly expects that there are interested investors in building and developing the educational infrastructure in sea transport with PPP scheme. However, the role of business entity is highly expected to establish and develop the educational infrastructure in marine transportation due to the The existence and availability of skilled human resources in supporting marine transportation is an absolute, thus supporting the development of human resources in marine transportation should be one of the priorities of development national maritime. As an illustration, the government only has naval academy programs in STIP Jakarta, Politeknik Ilmu Pelayaran (PIP) Semarang, Politeknik Pelayaran (Poltekpel) Surabaya, PIP Makassar, PIP Sorong. There are also the Education and Training Center for Science Shipping (BP2IP) Malahayati (Banda Aceh), BP2IP Barombongan, and BP2IP Tangerang. The academy is under the auspices of BPSDMP. For this year, the government opened new acceptance formations of new cadets for all transportation modes in line with the efforts of BPSDMP to improve the human resource in transportation field. The acceptance of new cadets for marine transportation mode this year is fairly large compared to other modes of transport. (*) Safri Burhanuddin Deputy for Human Resources, Science and Culture Ministry for Maritime Marine Transportation Edition | 2015 Sustaining Partnership | 11 Headline News Opportunities for Business Entity in Port Development The Government has launched the construction of a number of strategic ports in order to support the concept of marine highway that carried by President Joko Widodo. The port consists of international hub ports, the main ports, and the collector ports. On the other hand, the government is faced with budget constraints to accelerate the construction of the ports. B ased on the calculation of Director of Transportation, Ministry of National Development Planning / Bappenas, the estimated funding for 24 priority ports needs up to IDR243,696 trillion. This large investment has included the cost of dredging, terminal development, as well as land acquisition. Concerning the high scale of financing needed, the government encourages the involvement of enterprises in the realization of the national agenda. Ministry of Transportation (MOT), Ignatius Jonan, said that although the state has a major role in the port sector, but the government still gives opportunities for enterprises to work on this vital sector. “It is a monopoly if all the ports are run and managed by the state. I welcome private developers who are interested in building the port, just send the proposal to me, I will sign, “said Minister Transportation to the media, in Jakarta, in early October. MOT suggests, the state will not disburse the State Budget (APBN) for the construction of the 24 ports, but purely a business entity. Therefore, in some occasions the Minister of Transportation invites investors to work together to develop the ports in the country, including ports managed by the MoT. But especially for foreign investors, Jonan reminded to obey to the rules of ownership of the ships, which is 50% plus 1% must be owned by companies from Indonesia. Director of Ports and Dredging, Directorate General of Sea Transportation, Ministry of Transportation, Mauritz HM Sibarani, said current port development involves the coordination of the various parties and stakeholders, such as the Coordinating Ministry for the Economy, the Ministry of Maritime Coordinator, Ministry of National Development Planning / Bappenas, the Ministry of Public Works and Public Housing, Ministry of Maritime Affairs and Fisheries, Ministry of Rural Development of Disadvantaged Regions and Transmigration, Ministry of State Owned Enterprises, as well as local governments. Every year, said Mauritz, the Directorate of Ports and 12 | Sustaining Partnership Marine Transportation Edition | 2015 Dredging allocated a high budget for the improvement of port facilities and the dredging navigation channel / port pool. For National Budget 2016, there are 105 locations of ports in total with development activities. However, to achieve maximum results, it needs the role of a business entity such as PT Pelabuhan Indonesia (Pelindo) I, II, III, and IV for the construction of infrastructures and industrial areas outside Java, as well as shipping companies that will serve these marine highway routes. According to Mauritz, the scheme of Public Private Partnership (PPP) will be highly needed to cover the limited budget that can only meet about 30% of financing infrastructure development. Therefore, the Ministry of Transportation also expects more and more investors are interested in using PPP scheme in the port sector. Therefore, the development of 24 ports that support the marine highway program will be conducted by Ports Business Entities (BUP) with the agreement of PPP’s scheme. “Business entities can work together to build ports, Headline News Tanjung Perak Port Surabaya both main and supporting facilities, and operates the ports within the scope of the granted concession,” said Mauritz to Partnership Magazine midNovember 2015. Head of sub-Division of Maritime Transport Partnership Assessment and Multimodal Transport Management, Partnership and Service Center of Transportation Service (PKKPJT), Ministry of Transportation, Sandi Mahendra, said the government’s cooperation with business entities in the port sector has actually been going on since 10 years ago. In the era of the previous government, the Ministry of Transportation in 2005 had tried to develop the port infrastructures with PPP’s schemes for Bojonegara Port project, Serang, Banten Province. It was just the project hampered by the ownership issue of assets which are owned by PT Pertamina. Then it was followed by the Lamong Bay project in Surabaya, East Java; Tanah Ampo port, Bali; Maloy port, East Kalimantan; and Water Flow of West Surabaya (APBS). According to Mahendra, one of the PPP’s projects in the port sector that has been successful is APBS, although with the direct appointment to PT Pelindo III. For Tanah Ampo Port, there are actually two entities that enter pre-qualification, but there was only one that passed then the determination to enter the auction process is still in progress. “But, based on existing procedures, it should be established by Contracting Agency, Minister of Transportation, and the minister has not signed it yet, it has not been to the stage of the auction,” said Mahendra to Partnership Magazine on late October 2015. PPP’s projects in the port sector can run faster, the Ministry of Transportation is now more encouraging projects that come from the entities’’ initiation. Mahendra said, currently there are a number of unsolicited PPP’s projects, namely the Port of Kuala Tanjung, North Sumatra, which is managed by PT Pelindo I; Port of Tanjung Perak / Gulf Lamong Surabaya which is managed by PT Pelindo III; and a new port of Makassar, South Sulawesi, which is managed by PT Pelindo IV. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 13 International PPP Port Development through PPP Scheme in India India has a coastline as far as 7,517 km. Aware of the length of the coastline, the government built supporting infrastructure of sea transportation. Many ports in India were built by the Public Private Partnership’s scheme. I ndian government strongly believe that the social and economic development of a country can be supported by the marine transportation sector. Therefore the development of marine transportation infrastructure is really important. India, is known to have 12 main ports and about 200 supporting ports that exist along the coast and islands of the country. Unfortunately, the performance of the main ports optimized due to lack of infrastructures of commodities loading and unloading, less supportive dock for larger ships to anchor even management issues resulted in inefficiencies. In short, the cost of sending commodities through sea is very unnatural. In the ends, Indian-made products can not compete in international markets. To reduce the cost of export of products made in India and to streamline the port, the government further encourages the role of business entities to get involved to build, develop and run the main ports. This policy was released in 1996 by the Ministry of Transportation. As a result, some of the main 14 | Sustaining Partnership Marine Transportation Edition | 2015 ports have been successfully developed with PPP’s scheme. The main ports which were developed with PPP’s schemes include, Kakinada Deep Water Port (KDWP). In 1999, the Government of Andhra Pradesh (equivalent to local governments in Indonesia -red) decided to hand over the management of ports through PPP’s scheme. As a result, Kakinada Sea Port Limited (KSPL) was chosen to operate KDWP with the pattern Operate - Maintenance - Share - Transfer / Build - Operate Maintenance - Share - Transfer (OMST / BOMST). Other port was Gangavaram Port which was also offered by Andhra Pradesh through the PPP’s scheme. After conducting an international tender process, in 2002 a International PPP India developed many ports with PPP’s schemes, one of them is Nhava Sheva International Container Terminal. Mundra Port in India, the most successful example of ports in India developed using PPP’s scheme. consortium of Gangavaram Port Limited was chosen to build the port. Then there is also Nhava Sheva International Container Terminal located in Mumbai that uses PPP’s scheme. Australian consortium, P&O Ports or now called Dubai Ports, won the contract of BOT Nhava Sheva International Container Terminal Mumbai for 30 years. In India, the role of local governments like Andhra Pradesh in cooperation with a business entity is quite prominent. One of the local governments in India that successfully run PPP to develop marine transportation infrastructure is Gujarat. Gujarat was recorded as the first local government which develop the port with PPP’s scheme. Gujarat also has the largest port development projects with PPP’s scheme in India, namely the Mundra Port, Hazira Port, Pipavav Port and Dahej Port. The port serves export and import of commodities of coal, fertilizer, farm and garden products, salt, LNG and PNG to transportation of passengers. Mundra Port itself then became the first Indian port that is capable to handle 100 million tonnes of cargo. This record confirmed Mundra Port in line with other leading ports in the world. This record beat the ability of Kandla Port, owned by the government in the Gulf of Kutch. Gujarat government entrusted the development and operation of the Mundra Port in a 30-year contract to Adani Ports and Special Economic Zone Ltd (APSEZ). The success of Mundra Port could not be separated from its strategic geographic factors. Gujarat is known for its access to Rajasthan, Haryana, Punjab and western Uttar Pradesh. This location is also the gateway to Europe, USA, Africa and Western Asia. The success of the Indian government to develop its ports with PPP’s scheme could not be separated from its openness for foreign investments. The government also simplify the licensing process and provide various incentives for companies engaged in the development of the port sector. Noted, during the years 2013 - 2014, there have been 16 PPP’s projects in the ports development that were handed over by the government to investors. In fact, the government also announced a policy 'The Maritime Agenda' tha has been apllied since 2010 to 2020 for the development of marine transportation as well as an increase in capacity at the ports. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 15 Profile of PPP’s Project PPP’s scheme: Realizing International Standard Port Development The PPP’s scheme is applied to realize the Kabil CPO Port as an International BP Batam Port. The toughest challenge lies in how to attract investors into our country because we must compete with Singapore and Malaysia. A s the island bordering with Singapore and Malaysia and is in the territorial of the Malacca Strait, Batam has its own privileges. We can see dozens of large ships passing by from other countries around western part of Indonesian marine area from every parts of the city of Batam. We can also see the Statue of Water Lion which is the symbol of Singapore from the District Sekupang, Batam. With these advantages, 25 years ago, the government of Indonesia took steps to announce Batam as a Free Trade Zone to attract investors and businessmen to come to Batam. Through BP Batam, the central government continues to build and develop a wide range of facilities and infrastructures to make Batam as a gateway into Indonesia. One of the infrastructures that is currently being worked on is the development of the CPO Kabil Port. The government hopes that in the future this port will become the International Port of Cargo and Container which includes the activities of loading and unloading commodities and exporting and importing commodities, as well as the Pungur Lake port that serves passengers in the country. In the port master plan 2006, the port which is located in Tanjung Sauh, Batam is planned to have a cargo terminal area of 1,000 hectares (ha), which is connected by road or bridge along 7 kilometers from Kabil Terminal. The condition of Kabil CPO Port currently has a dock length of 420 meters, with the capacity of berthing ships up to 35,000 DWT, the storage capacity of 16 | Sustaining Partnership Marine Transportation Edition | 2015 tank of around 75,000 kilo liters and warehouse area of 1,890 square meters. For the first phase is planned to build a pier wharf along 216 meters, 273.5 meters of trestle piers, 269 meters reclamation and safety waves and 1,218 meters of pipe rack construction. According to the Head of Planning Techniques BP Batam Imam Bachroni, the purpose of this port development is to absorb the transshipment market in the Malacca Strait which could potentially generate substantial profits. In a day, there are 55 million TEUs transported commodities from passing ships in the Malacca Strait, but unfortunately the benefit is only enjoyed by Singapore and Malaysia because Indonesia does not have the facilities to hold them. With the development of Kabil CPO, Batam BP hopes to capture four million TEUs of commodities fromthe existing market. According to Imam in 2012, actually this project was prepared in cooperation with Profile of PPP’s Project PPP’s scheme along with the Pelindo II with an investment of IDR 7 trillion. But in the process of preparation for implementation the investment number has gone up to IDR 8 trillion because of inflation and other external factors. That is why, the BP Batam is currently reviewing the feasibility study conducted by Pelindo II to be adapted to current conditions. "Within one or two months ahead we will continue to finalize and review the feasibility study so that in 2016 it will ready to be offered to the private sectors with Public Private Partnership’s scheme," said Imam. Imam explained that PPP is the most appropriate scheme to be applied in the construction of infrastructure in Batam considering the island has no natural resources as other areas so that economic progress is highly dependent on the completeness of infrastructure. "In other areas, people build the infrastructures after they need them. While in Batam, the facilities are built to attract people to come, "he explained. Furthermore, he said that BP Batam has developed the PPP’s scheme since 20 years ago because it can not rely on State Budget. In contrast to other areas which the investment obstacles are still on land acquisition, Batam does not have problems in land acquisition because BP Batam got Rights Management (HPL) of land from the central government. So ,whenever there are investors who are ready to invest, BP Batam has to published Building Right on Land (HGB) only. And when the concession period runs out, HGB will be returned to BP Batam to be extended or transferred to other parties depending on the result of the evaluation. Especially, for the development of the Port of Kabil, BP Batam still has the land constraint because of the location of Tanjung Sauh, Batam is located between the islands of Batam and Bintan that some part of the land has not been included into the territory of Free Trade Zone and Free Port (KPBPB) Batam. But Imam convinces that he has negotiated with the local government to carry out the land acquisition so that the investors do not need to worry. The toughest obstacle in the development of infrastructure through PPP’s scheme in Batam city lies precisely in the strong climate of competition among countries. There are investors who are reluctant to invest because they are not sure that Batam can compete with Singapore or Malaysia, which has full facilities and high support from their government. Thus, the toughest challenge of BP Batam in implementing the PPP’s scheme is to make a development project which is financially feasible so that investors continue to come to help the development in Batam. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 17 PPP’s Project Profile Kuala Tanjung Port Is Ready to Serve the World High logistics costs in traffic flow of commodities and services through the land transportation make the government under President Joko Widodo keep improving. One of the main economic development programs is to build a marine highway. O ne of important elements in marine transportation is the presence of the port. In February 2015, Jokowi inaugurated the groundbreaking development of the Port of Kuala Tanjung in Batuabara District, North Sumatra, which is conducted by PT Pelabuhan Indonesia (Pelindo) I. Aside of Bitung, this port will be a multipurpose terminal and an international hub which supports the Industrial Zone development project in Kuala Tanjung and Sei Mangkei. Located within 27 kilometers from the Special Economic Zone (SEZ) Sei Mangkei, ensures the important role of this port for the development of industrial zones. The Port of Kuala Tanjung has a natural depth of up to 14 meters Low Water Spring (LWS) with a distance of 2.7 kilometers from the coast. Based on target of Pelindo I, Kuala Tanjung construction will be completed in 2016. Director of Pelindo I Bambang Eka Cahyana stated, in November 2015 the progress of construction of the port is projected to have reached 30-40 percent and 54 percent by the end of the year. The development of this port will be accelerated. "By the end of July, the progress of the construction of Kuala Tanjung is up to 7%. It is targeted to operate by the years 2017-2018. This port will transport industry products from Kuala Tanjung Industrial Area, "said Bambang. The budget allocation for international port projects with a capacity of up to 50 million TEUs is IDR4.9 trillion for the early stages with a total of IDR42 trillion for the entire cost of the investment project. Bambang claimed to have a strategy to prepare a budget for the construction of the port. Pelindo I has possessed a total of IDR 8 trillion consists of IDR4.5 trillion of asset revaluation process results and IDR1.5 trillion of bond issuance plan. Not only that, Pelindo I also involves other SOEs, such as PT Wijaya Karya (Persero) Tbk and PT Savings and Retirement Insurance (TASPEN) to build 18 | Sustaining Partnership Marine Transportation Edition | 2015 the largest port in Indonesia's western part. The fund will be used to build a 400-meter long dock and a 2.7 kilometers trestle. The facilities to be built are storage tanks with a capacity of 145 thousand tons and container yard with a capacity of 400 thousand TEUs. To take advantage of the storage tank, PT Prima Multi Terminal as a subsidiary of Pelindo I has signed a Memorandum of Understanding (MoU) with PT Tolan Tiga Indonesia. The MoU includes the scheduling of the construction of the first CPO terminal by Prima Multi and assurance from Tolan Tiga on the commodities amounted to 10 thousand to 15 thousand tons per month which requires five storage tanks with a capacity of 3 thousand tons per unit. In the second stage, the dock length will be increased to 1,000 meters with the construction of an industrial area of 1,000 hectares. Then, there will be revamping on the loading and unloading activities from Kuala Tanjung to several worldwide ports in the third stage. In the end, Kuala Tanjung will be developed as a modern port city. Important port for the World Overall, Pelindo I is expected to have up to IDR 8 trillion to build the industrial area of 1,500 hectares in the Port of Kuala Tanjung. Furthermore, the port is expected to cost up to IDR42 trillion. Director of Ports and Dredging PPP’s Project Profile Directorate General of Sea Transportation Ministry Sibarani Mauritz said the construction of the Port of Kuala Tanjung used the Public Private Partnership’s scheme, same as the construction of other 23 ports throughout Indonesia. This is done to support the existence of the marine highway by establishing a Port Enterprises (BUP). “PPP’s scheme is needed to fill the State Budget shortfall. It needs effort in order to attract the private sector to invest in the port, “said Mauritz. The port which will become an international hub is expected could overcome the obstacle that have been faced such as the limitations of the depth and narrow port groove so that it is only capable of serving the loading and unloading of small tonnage ships. The port which will become an international hub is expected could overcome the obstacle that have been faced such as the limitations of the depth and narrow port groove so that it is only capable of serving the loading and unloading of small tonnage ships. To meet the targets as an international port, Pelindo I has signed the main points of agreement with the Port of Rotterdam Authority on August 27, 2015. The signing was done by Bambang and CEO Port of Rotterdam, Allard Castelein. The main agreement is related to the development The process of building the Port of Kuala Tanjung in Batubara District, North Sumatra. of Kuala Tanjung project and Port Management Services Agreement (PMSA II). At 13 October 2014, PMSA I has been signed in the Netherlands. After the signing of PMSA I, Port of Rotterdam Authority has also completed and submitted reports of Port Model Analysis (PMA) and port management program. In the PMA report, the Port of Rotterdam Authority has assessed the port characteristics, identified business opportunities, developed strategy of potential market development and recommended methods in the development of the Port of Kuala Tanjung as integrated industrial gates with the area of Kuala Tanjung, Sei Mangkei, and Belawan. While the PSMA II, Port of Rotterdam will provide experts and consultants in the commercial, operational, and financial aspects to develop the port and management of certain additional services. According to Bambang, the memorandum of understanding with the Port of Rotterdam is very important for Pelindo I for several reasons. First, it supports Marine highway Program launched by President Joko Widodo. Secondly, the project is aimed to establish ports connection in western Indonesia that will improve logistics performance and competitiveness in Indonesia. “Third, this project will contribute to economic growth, especially the growth of regional economies in which the project is developed,” said Bambang. Director of Pelindo II, RJ Lino said that, as an international hub port, Kuala Tanjung must have a primary tenant. Lino equate Kuala Tanjung with Tanung Pelepas Singapore which currently has a number of major tenants such as China Shipping, Maersk Line and Evergreen Shipping. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 19 PPP’s Project Profile IDR365 Billion budget to Integrate the Port PENGEMBANGAN PELABUHAN BITUNG Zone TERINTEGRASI (KEK) DENGAN of Bitung with Special Economic KAWASAN EKONOMI KHUSUS (KEK) BITUNG Marine transportation has become one of the foundations in the traffic of commodities and services, including the presence of marine highway that can support Indonesia as the world’s maritime pivot in the year 2045. O ne of the elements in marine highway is the existence of a reliable ports. Currently, Indonesia has 24 strategic ports supporting marine highway, five- hub ports and 19 feeder ports which are spread all around Indonesia, one of them is the Port of Bitung in North Sulawesi. Bitung Port that serves passengers and containers is managed by PT Pelabuhan Indonesia IV (Persero). Manager of Planning and Operational Pelindo IV Sardi said Bitung Port will be directed into an international hub. "For that, we conduct the development of the current Port of Bitung which is located in Tanjung Merah that will become Special Economic Zone and is connected with the industry," says Sardi during the interview with Partnership Magazine, midNovember 2015. Bitung Port is located on the island of Lembeh in Bitung City with the dock area of 1,440 Railway Planning RencanaJalurRelKeretaApi Bitung Port PelabuhanBitung BitungRencanaPengembanganPelabuhanBitung Port Development Planning in KEK Area diKawaasanKEK 11/29/15 meter and container yard (CY) of 5 hectares. While the existing Bitung container terminal facilities is the dock area of 591 meters, CY of 5.5 hectares, 4 units container cranes (CC), and 8 units Rubber Tyred Gantry (RTG). Based on data from Pelindo IV, Port of Bitung in 2014 has an installed capacity of up to 300 thousand TEUs per year and a volume of 200 thousand TEUs. The average growth reached 14 percent and a projected growth reached up to 10 percent for the period 2015-2019. This year, revitalization of the Port of Bitung was conducted so for the period 2015-2022 an estimated installed capacity will reach up to 1 million TEUs per year; in 2025 will reach up to 1.5 million TEUs per year; and in 2030 will reach up to 3.2 million TEUs per year. 20 | Sustaining Partnership Marine Transportation Edition | 2015 Sardi explained, the Port of Bitung is being developed at Tanjung Merah, Bitung City, which is about 6 kilometers from the existing port. Port in Tanjung Merah is located in a Special Economic Zone (SEZ) so that will be built a number of supporting infrastructures such as construction of marine highway and railway. "There are several alternative connectivities from the SEZ to the port, those by building highway access from the Tanjung Merah that are in the SEZ to the location of existing port or by building railways," says Sardi. According to Sardi, Bitung Port development carried out through Government Capital (PMN) of IDR365 billion, including the addition of equipment. The development plan is still in the stage of the licensing process and will begin to be constructed PPP’s Project Profile Port of Bitung in North Sulawesi. in 2016. "It is planned to be completed in stages, first in 2017 and some of them can be used already. Then the reclamation will be done until the third stage, which is in 2019, "says Sardi. Director of Ports and Dredging Directorate General of Sea Transportation (DGST) of Ministry of Transportation Mauritz Sibarani explained, the directorate allocated budget to improve port facilities and shipping channel dredging activities or harbor pools. For State Budget 2016, there are a total of 105 locations which will be constructed, including the Port of Bitung. "However, to achieve maximum results, the role of the private sector is still needed to build infrastructure and industrial areas especially outside Java Island. The shipping companies will serve the marine highway route, "said Mauritz. Through Public Private Partnership’s scheme, Mauritz said, business entities can engage in building both main and supporting ports, and operates the ports within the scope of the concession. With the development of the Port of Bitung in Tanjung Merah, it is expected to be an increase in traffic and capacity. Referring to the data of Pelindo IV, traffic in Tanjung Merah is estimated to penetrate 1.37 million TEUs in 2025 and to 2.76 million TEUs in 2030. The installed capacity will reach 1.5 million TEUs in 2025 and 3.2 million TEUs in 2030. The infrastructures in tanjung Merah are container yard covering an area of 15.7 hectares in 2025 and to 16.3 hectares in 2030, with a dock length of 1,930 meters in 2025-2030. Existing equipments in tanjung Merah are 15 units of container cranes in 2025 and 28 units in 2030, 35 units of transtainer in 2025 and 60 units in 2030. For the container terminal, the depth of the pool reaches 11 meters LWS; the dock area of 358.5 meters; 2 docks measuring 255 meters; container yard of 30 thousand square meters; and a second container yard area of 22 thousand square meters. Bitung port in Tanjung Merah will be supported by two important infrastructures, those are the construction of marine highway and the railway. Marine highway execution project is planned by conducting four stages such as developing dock measuring 131 x 35 square meters; reclamating and retaining of 5 hectares area; pavementing 5 hectares yard; and constructing trestle measuring 74 x 11.5 square meters. (*) Marine Transportation Edition | 2015 Sustaining Partnership | 21 Reportage Marine Highway, Realizing Connectivity of Logistics Distribution Disparity in the price of commodities to eastern Indonesia is arguably lame compared to those in western Indonesia. High distribution costs become the cause of the high price of commodities in eastern Indonesia. Therefore, marine highway was chosen by government to realize the connectivity of logistic distribution between western and eastern Indonesia. B ased on Sea Transport Connectivity Index, Indonesia still shows high gaps in logistics connectivity in each region. For example, Jakarta and other western Indonesia, normally have strong connectivity index. As for the eastern Indonesia, the connectivity index is very low. Meanwhile, the condition of national marine transportation based on the Global Competitiveness Index 2014 shows that Indonesia is at number 77. The number is still worse than the connectivity index of Malaysia and Thailand. marine transportation is a favorite choice for many countries for logistics distribution, since the marine transportation can transport logistics in large quantities and are relatively affordable compared to air transport which is too limited and costly. Realizing these conditions, the government develops marine highway infrastructure as an effort to realize sustainably equitable development. Marine highway is perceived as a concept which makes the sea as an effective tool for connectivity among regions by ships which sail regularly from western to eastern Indonesia. According to the Director of Transportation of National Development Planning Agency (Bappenas) Bambang Prihartono marine highway is a concept to reinforce shipping lanes 22 | Sustaining Partnership Marine Transportation Edition | 2015 in Indonesia focusing on the eastern part. Realization of marine highway begins with the determination of the two port hubs (national) based on the distribution of the regions as well as cargo and be able to serve large commercial ships above 3,000 TEUs or equally to Panamax ships of 6,000 TEUs. Two specified port hubs are the Port of Kuala Tanjung in North Sumatra and the Port of Bitung in North Sulawesi. "In principle, the development of Marine Highway or Pendulum Nusantara is the arrangement of the existing (linear) route, which needs other aspects to establish effective Maritime transportation system in Indonesia," he said. Reportage In addition, until 2019, the marine highway covers the development of 24 strategic ports in Indonesia, which will be developed together with StateOwned Enterprises namely IPC with an investment of IDR 243.6 trillion, the development of short sea shipping (IDR 7.5 trillion), the construction of public cargo facility and bulk (IDR 40.6 trillion). Beside that, it conducts the development of commercial and non-commercial ports (IDR 189.6 billion), the development of multi-modal transportation to the port (IDR 50 trillion), the revitalization of the shipbuilding industry (IDR 10.8 trillion), the ship needs for 5 years (USD 101, 7 trillion), the need for patrol boats (USD 6 billion), and the accelerated development of long unfulfilled (IDR 50 trillion) as well. The Government, through National Development Planning Agency has published a Public Private Partnership (PPP) Book 2015 that includes 7 port development projects in potential category. The ports are Port of Maloy, East Kalimantan, Port of Kuala Tanjung, North Sumatra, Expansion of Kabil Port, Batam, Garongkong and Makassar port, in South Sulawesi, Port of BauBau, in Southeast Sulawesi and Port of Bitung, in North Sulawesi. Indirectly, the inclusion of such projects in the PPP Book does certainly contribute to the marine highwayprogram of the government. Meanwhile, Director General of Marine Transportation (Director General of Sea), Bobby Mamahit explained that the concept of marine highway is the logistics distribution lanes by ships from the edge of Sumatra island to Papua. For his part, called Bobby, has established six marine highway ships routes launched this year. It was based on the decision of the Directorate-General (DG) of Marine Transportation No AL 108/6 / 2DJPL - 15 of route network organization of public service obligations, for the transport of commodities related to the implementation of tmarine highway fiscal year 2015. The six marine routes are the Jakarta-Serui- NabireWa s i o r - M a n o k w a r i - B i a k Jakarta, Surabaya-Tual-FakfakK a i m a n a -Ti m i k a - S u ra b aya , Surabaya-Tual-Dobo-AgatsMerauke-Saumlaki-Surabaya, Surabaya-Maumere-ReoLewoleba-Rote-Sabu-WaingapuSurabaya, Jakarta-Tobelo-GebeBuli-Ternate-Galela-Jakarta and Jakarta-Kijang-Letung-TarempaNatuna-Midai-Serasan-Jakarta. Beside the route, said Bobby, it also ordered 39 ships worth 1.4 trillion after on August and October has ordered 32 pioneer ships. "This procurement of pioneering ships was done to support marinehighway program launched by the government, in order to accelerate economic growth and ensure the connectivity among the islands," he concluded. (*) Marine Transportation Edisi Perkotaan Edition | 2015 Sustaining Partnership | 23 Education Five Policies in Marine Sector to Make Indonesia as the World’s Maritime Pivot (Antara Foto/Widodo S Jusuf) President Joko Widodo while visiting Tanjung Priok Port to review the process of development and expansion of the port, especially the Kalibaru Port related to the implementation of marine highway program. Chamber of Commerce and Industry (Kadin) said, the potential value of Indonesian maritime reached USD171 billion, or the equivalent of IDR2.046 trillion, with an exchange rate of IDR12,000 per USD. The projection consists of coastal areas of IDR670 billion, biotechnology of IDR480 trillion, petroleum of IDR252 trillion and sea transportation of IDR240 trillion. T he government in the era of President Joko Widodo made the program of Indonesia as the World’s Maritime pivot (PMD) in 2045. A number of policies in supporting infrastructures development in order to achieve those targets continues to be arranged. As a first step, Indonesia still needs to fix the connectivity index rating. The rating in the marine transportation sector in 2014 was increased to 77 compared to the year 2012 is in position 104. The score of Logistics Performance Index (LPI)of Indonesia increased 0.14 compared to the year 2012 so that the global ranking rose from 59 to 53. Despite there was an increase, the ratings are much lower than Thailand and Malaysia. The challenge is the implementation of government programs in logistic sector. Connectivity index is measured by a factor of registered ships, carrying container capacity, the maximum size of the vessels, 24 | Sustaining Partnership Marine Transportation Edition | 2015 the number of ship visits, and shipping registered companies. The Center for Coastal and Marine Resource Studies (PKSPL) Institute for Research and Community Empowerment (LPPM), Bogor Agricultural University (IPB) Tridoyo Kusumastanto said, it requires marine policy (ocean policy) that include the entire maritime sector to become a countrybase maritime. The elaboration of ocean policies are the ocean economy policy, ocean governance policy, ocean environment policy, maritime culture policy, and maritime security policy. "Indonesia should be able to do the exploration and exploitation of natural Education resources in the sea outside the territorial jurisdiction of Indonesia. In the context of the other economies, Indonesia should take advantage of the strategical Malaka strait and three Indonesian archipelagic sea lanes (ALKI) as the source of state and people’s revenue, "said Tridoyo. ALKI was set to link two free waters, the Indian Ocean and the Pacific Ocean which includes ALKI across the South China Sea-Strait Karimata-DKI-Sunda Strait; ALKI II-Sulawesi Sea crossing the Strait of Makassar-Luatan Flores-Lombok Strait; ALKI III cross-Strait Pacific Sumadera Maluku, Luat Ceram-Banda Sea. Tridoyo who is Professor of IPB Economic Marine Policy said, the government should develop a national naval force to control the international shipping and to develop competitive and efficient ports. The value of marine area as projected by Kadin, said Tridoyo, is also very decisive and supportive to the growth of Indonesian marine sectors. For marine transportation sector, the number of ship visits to all ports experienced fluctuation with a positive trend. Involving Private Roles Tridoyo said the development of maritime potency in Indonesia cannot only be done by the government. The investing value is fairly large, as well as infrastructure projects in general, can not be done if it relies only on the state treasury. "Private sector involvement can encourage a conducive business climate to sustainable economic growth. The Government should have a clear policy direction in developing marine-based economy, "said Tridoyo. There are seven points mentioned by Tridoyo that government needs to focus on building a maritime-based economy. One of them is improving the role of private sector in making investments in the maritime field, including marine transportation. "Increased investment in the marine and maritime field is conducted through progressive fiscal and monetary policies. Its base of national interest so that investment grows, "he said. The involvement of private companies in the form of Public Private Partnership (PPP) to develop marine transportation in Indonesia is currently directed towards the development of marine highway, reliable and integrated harbors, the certainty of the routine and scheduled cruise, effective inland access and development of commodities transhipment services among countries and continents. "Marine development is complex because it involves multisectors, the marine industries, marine transportations, marine constructions, and marine services therefore it should involve variety of state agencies, the private sectors and the communities to determine the success of marine development," he said. (*) IDENTIFICATION OF 24 STRATEGIC PORTS SUPPORTING MARINE HIGHWAY 24 Strategic Ports Supporting Marine Highway | 5 Hub Port | 19 Feeder Port | Indication of Financing Needs "The size of ships sailing in the waters of Indonesia grew larger and the value of trade through marine transportation services is increasing. It needs the effectiveand efficient development in the marine transportation sector, "said Tridoyo. Marine Transportation Edition | 2015 Sustaining Partnership | 25 Figure PPP’s implementation of the Transportation Sector: Required Completion of the Technical Guidelines PPP’s scheme is an integral part with the infrastructure because it is one of the alternatives of financing infrastructure. The technical instructions related to the operational mechanisms are required to make the implementation clearly. Ir. Bambang Prihartono, MSCE, Director of Transport Ministry of National Development Planning (PPN) / Bappenas A s technocrats in transportation, the task of Ir. Bambang Prihartono, MSCE is very complex. Beside collecting all the proposals from various parties, he also must formulate these proposals into a draft policy of development transportation sector that supports the development of national economy and improves the competitiveness of the nation to welcome AEC (ASEAN Economic Community) which will be implemented in 2016. "Transportation has a very important role in supporting national economic growth and improving competitiveness of Indonesia in the era of free market with the implementation of MEAs in 2016", said the Director of Transport Ministry of National Development Planning (PPN). Beside that, the role of the transportation sector is also needed in order to overcome the Telaga Pungur Port Batam gap and encourage equitable development results and prevent the social and political conflicts that arise in the border region. Bambang is very enthusiastic about the accelerated development of marine highway by the administration of President Jokowi .As a maritime country, Indonesia basic mass transit needs to be returned to the sea. To make the marine highway systems run smoothly, it requires efficient supporting means, so, the development of transportation systems can not be done per mode sector but must be integrated among modes to create an affordable cost for the society. 26 | Sustaining Partnership Marine Transportation Edition | 2015 To build an effective transport system requires separation between the regulator and operators in the transportation sector so that coordination is easier. As stipulated by law, the separation of the functions of regulator and operator becomes priority in RPJMN years 20152019. Bappenas hopes in the future the government only functions as a regulator, while the management of the transportation facilities are handed over to nongovernmental organizations both private entities or SOEs. This cooperation can be realized through the mechanism of Public Private Partnership (PPP). FIGURE PPP’s scheme is an integral part of the infrastructure because it is one of the alternatives in financing infrastructures. Cooperation between the Government and business entities is not necessarily delegating all assets from the public to private investors but the transfer of risks of provision of public services from the government to the private sectors who will receive compensation in the form of commercial operation rights. In accordance with public needs, regulations in the procurement of transportation infrastructure in cooperation with the private sector continue to be equipped with the announcement of the Presidential Decree No. 81/2001 updated by Presidential Decree No. 42/2005, and then by Presidential Decree No. 12/2011. However, KPBU or PPP’s scheme in the provision of transportation infrastructure is not well developed so far, whether the initiator is from the government (solicited) or private parties (unsolicited). According to Bambang Prihartono, some problems in transportation projects funding through KPBU or PPP’s scheme are (1) The scarcity of projects that are commercially prepared and bankable, (2) lack of understanding and experience of the bureaucracy in the process of PPP, (3) lack of a clarity of scheme of government support, (4) absence of incentives and the "on-top" budget to advance PPP, (5) existing Central Unit of PPP had not been showing good performance in promoting PPP’s infrastructures projects and delivering them to the stages of the transaction, and (6) there are some institutions that have not yet formed as mandated by law, such as multimodal business entities, business entities of facilities and business entities of railway infrastructure. The alternative financing of PPP’s scheme has not been responded well by the government or private parties because of the complexity of the procedures that must be taken. In addition, technical guidance related to the operational mechanism and the system of financing through PPP are still too general so it is hard to be understood by stakeholders. That is why the more detailed implementation guidelines are required. This is important for the implementation of the guidelines to be drawn up in more detail so that the steps that must be taken to obtain financing PPP more clearly. And the most important process of improvement of the technical guidelines is the necessity to wider dissemination so that transportation stakeholders know and understand the mechanisms of PPP. (*) Barelang Bridge, Batam Marine Transportation Edition | 2015 Sustaining Partnership | 27 DIRECTORATE DEVELOPMENT OF PUBLIC-PRIVATE PARTNERSHIPS Lembar Port, West Lombok, West Nusa Tenggara (NTB) 28 | Sustaining Partnership Marine Transportation Edition | 2015