Infrastructure investments and development are demarcated by sector in Indonesia. Because each sector has its own laws and regulations, coordination is essential for effective infrastructure development. Since Indonesia has several agencies promoting and implementing PPPs, and some have overlapping functions, it is important that the responsibilities of each agency are clearly defined to eliminate possible coordination problems (ADB 2017) (Table 12.4).
Table 12.4: Government Organizations Promoting PPP Systems in Indonesia
Key Agencies | Function |
Ministry of National Development Planning and National Development Planning Agency | Coordinate the country's PPP program, decide on whether projects should be procured as PPPs, and evaluate the progress on PPP projects. The National Development Planning Agency has a central PPP unit, the Directorate, responsible for ensuring policy consistency, quality control and transparency, setting standards, and compliance monitoring of PPP projects. |
Committee of Infrastructure Priorities Development Acceleration | Recommends policies to strengthen the PPP system, and determines the priority of PPP projects. |
Ministry of Finance | Provides budgets for PPPs and recommends fiscal support for PPP projects. |
PT Sarana Multi Infrastruktur | State-owned enterprise provides infrastructure financing for PPP projects. |
State Asset Management Agency | Provides land acquisition fund for PPP projects. |
Indonesia Infrastructure Guarantee Fund | Mandated to provide contingency support and guarantees to risks, such as government delays for getting projects off the ground. |
State-Owned Infrastructure Financing Company | Indonesia's other main supporting agency for PPPs. Mandated to provide alternative sources of funds to finance, promote, and support PPP projects, and to increase the size, capacity, and effectiveness of infrastructure projects through partnerships with third parties. |
PPP = public-private partnership.
Source: Authors.