Sunday 10 May 2009

Indonesian government initiatives to stimulate investment in infrastructure and clean technologies

On 28 April, the Co-Ordinating Ministry of Economic Affairs presented the recently established PT Sarana Multi Infrastruktur (PT SMI). This state-owned company has been established with the objective of bringing government institutions, private companies and financing institutions together to realize infrastructure investments. The company aims to arrange the needed government support for infrastructure projects and to assist in the arrangement of financing. It may also participate in joint ventures that build and operate infrastructure projects.
Last year, the Indonesian government launched the Clean Technology Fund. This fund has US$ 250 million available to invest in projects that are using environmentally friendly technologies, projects in renewable energy, in water and in agriculture. The fund can invest in projects of up to US$ 80 million, with equity amounts of between US$ 5 and 20 million and can arrange additional financing from other funds and from financial institutions. The Fund will apply market-based profitability criteria in its project selection, but uses the Ministry of Finance’s influence in arranging the necessary support from government institutions and state-owned companies.

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