Jakarta Outer Ring Road (S and E1 sections)

cancelled

In 1993, the Indonesian consortium PT Marga Nurindo Bhakti entered into a joint venture with state-owned toll road company Jasa Marga by signing a 29-year BOT contract for the 15 km S section of the Jakarta Outer Ring Road (JORR). In 1995, the consortium also signed an additional 45-year BOT agreement for the 13 km E1 section. 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.