Commentary Report on Infrastructures

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Title of Extract:
Indonesia’s Infrastructure Investments: Finally Taking Off

Source of Extract:
International Finance Corporation. "East Asia & the Pacific." Indonesia’s Infrastructure Investments: Finally Taking Off. The World Bank Group, 28 Aug. 2012. Web. 20 Sept. 2012. Date of Extract:

August 28th 2012

Word Count:
Economic Concepts:
- Opportunity Cost
- Economic System
- Factor of Production
- Production Possibilities Frontier
- Economic growth

Gianca Devina
ID number:

Indonesia’s Infrastructure Investments: Finally Taking Off

After years of neglect, Indonesia is ratcheting up infrastructure spending to upgrade roads, ports, water facilities, and power plants. But instead of leaning heavily on public funds to get them done, the government is inviting the private sector to foot a good chunk of the bill and take advantage of investment opportunities. During next month’s Indonesia International Infrastructure Conference and Exhibition, the government is expected to showcase new infrastructure projects for foreign and domestic investors. Last month, China Railway Construction Corporation signed an agreement to invest in the 30-kilometer Sunda Strait Bridge project linking the Indonesian islands of Sumatra and Java. And last year, Japan’s J-Power consortium won the bidding to build a new power plant in Central Java, which would provide electricity for 8 million people by 2016. 

“The progress in infrastructure development in the last two years has been much better than expected,” says Shobana Venkataraman, IFC Principal Investment Officer. “Indonesia’s economy has improved and its sovereign rating has been upgraded to investment grade, making infrastructure investments more attractive to investors and lenders.”

Not only that, Indonesia has eased regulations to make the infrastructure sector more investor-friendly, such as an amending the law on public-private partnerships...
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