The BWG serves as a platform to foster an enabling environment for private-sector participation in the financing of major infrastructure projects in Indonesia. With focus primarily on identifying solutions rather than describing challenges, BWG members aim to enhance understanding and achieve consensus on a set of issues that need attention in the short to medium term and also explicit public and private commitment for their resolution.
During its first two meetings, the BWG benchmarked Indonesia's public-private partnership (PPP) programme and highlighted the main manifestation of political and regulatory risk in the country. Based on BWG findings, the group formulated several country-specific recommendations to be implemented through ongoing dialogue with the Government of Indonesia and by means of a concrete action plan, with completion scheduled for the end of the initial BWG mandate (March 2017).
Recognizing the private sector as an inevitable additional source of funding and for its valuable technical expertise, the Government of Indonesia continues to facilitate the development of infrastructure projects using the PPP scheme and has recently enacted various reforms to encourage private-sector investment in PPPs:
1. certainty of a return on investment by means of payment by the user in the form of tariffs (user charge) or availability payment
2. provision of government support with viability gap funding
3. provision of a government guarantee
4. facilitated land acquisition