Infrastructure pioneer paves the way
THE FIRST PRIVATE COMPANY IN INDONESIA SPECIALIZING IN INFRASTRUCTURE, PT CITRA MARGA (CMNP) HAS BECOME THE COUNTRY'S PREMIER PRIVATE TOLL ROAD OPERATOR AS WELL AS A MAJOR INVESTOR IN DEVELOPMENT PROJECTS IN MALAYSIA AND THE PHILIPPINES

ON THE ROAD CMNP is hoping increased infrastructure investment eases traffic congestion.

Private enterprise may present an attractive alternative for Indonesia’s infrastructure development needs. As foreign investment returns to the country and the economy begins to regain momentum, the demand for top quality infrastructure to support logistics and transport will grow even greater; the slow turn of the bureaucratic wheel may not be able to cope quickly enough with the requirements of a fast-paced market. As increasing liberalization occurs in the country, niche companies specialized in infrastructure development and management such as PT Citra Marga (CMNP), a private toll road operator, are likely to assume an expanded role on the national scene.
According to CMNP, traffic jams in major cities are becoming worse during peak business hours (company statistics show a 14.6% increase in toll road activity in 2000); provincial autonomy laws were implemented last year as well, and regional governments are beginning to take control over their own infrastructure development.

DADDY HARIADI President Director of PT Citra Marga (CMNP)

These factors alone are sufficient to drive the demand for increased road construction. President Director of CMNP, Daddy Hariadi, comments, “one of Indonesia’s weaknesses at the moment is infrastructure. I think that there is a lot of work to be done in infrastructure development and the government must acknowledge its lack of funds. In my opinion, it would be advantageous for everyone involved to invite investors to come so that we could work together.” With regards to upcoming changes in legislation that will allow for further liberalization of the transport sector, Mr. Hariadi states, “I understand that parliament is now exercising a draft for regulation changes. Once it is amended and endorsed, it will be good news for the investor.”
CMNP has been a specialized company dealing in the building, operating, maintenance and management of toll highways in Indonesia since its establishment in 1987. As Mr. Hariadi explains, “Citra Marga was established 14 years ago, making it the first private company in Indonesia to engage in the infrastructure business. We were also the first private toll road company in the country.” Today, the company operates three toll roads in Indonesia in addition to its operations and investments abroad. CMNP has been involved in toll road development projects in the Philippines, owns a share of the Citra Metro Manila Tollways Corporation which built and has concessions for the Metro Manila Skyway, and is also a shareholder in Malaysia’s Yong Pen-Ayer Hitam toll road which was built in 1991.

Future plans for the company include diversification and expansion to include a larger infrastructure development capacity, especially in terms of construction and management. Ports, pipelines and even waste management are all options under consideration by the company’s board. “If we want to grow, we must diversify,” Mr. Hariadi elaborates. “Our plans are to do that but within the infrastructure sector and, at the same time, capitalizing on our strengths in project management. There are a lot of companies in the private sector doing big business and they will have infrastructure needs; they must have a port, roads from the mine to the port, oil companies need pipelines, and so on. These are all needs that we can provide for.”

In reference to the general economic situation in the country, Mr. Hariadi states, “Indonesia is a country with huge opportunities; it has a market of over 200 million people. It only needs to know how to manage itself a little better. It’s true that we have some weaknesses but all we need is some time. The county may be almost 90% Muslim, but it is very different to places in the Middle East. Indonesian Muslims are moderate and understand that religion is a means for the people to live in peace and happiness.”