Jakarta Outer Ring Road (E2, E3 and N sections)

Cancelled

Failure

In 1995, PT Citra Bhakti Marga Persada signed a 33-year BOT contract for the construction and operation of sections E2, E3 and N of the Jakarta Outer Ring Road. The 9km E2 section was already built and had been operated by PT Jasa Marga since 1990. The remaining 19.12km was under construction (all land has been acquired) and was due to open in December 1999. Project costs were estimated at Rp1,044.3 billion (US$224 million). The Asian Crisis created a rapid currency devaluation and economic decline. As a result, the cost of imported construction materials rose sharply and credit became difficult for concessionaires to obtain, even at very high interest rates. On the demand side, toll road traffic in general began to decline be as much as 8.1% in 1998. Social pressures caused the Government to be reluctant to adjust toll rates. Coupled with construction cost overruns, these factors made it increasingly difficult for the concessionaires to repay US Dollar denominated debts to the local banks. When they defaulted on payments to local banks, Jasa Marga revoked the concession rights to the JORR operators. As of May 2002, the government was still working on the re-tendering process.

Transport

World Bank Group

Project

Road, Commercial, Steel, Government