Indonesia Opens up Airport Management Projects to Foreign Companies

January 2020

Indonesia plans to offer more airport management projects in 2020, following its first award to a foreign company for the Labuan Bajo airport in Nusa Tenggara Timur, which serves as a gateway to the Komodo National Park. A 25-year contract for development and operatorship of the Komodo Airport was granted by the government to a consortium of local company, PT Cardig Aero Services and Singapore’s Changi Airports International Pte Ltd.

The consortium is investing IDR 1.2 trillion (USD 86 million) to expand the airport’s runway, aprons and international terminals. An additional IDR 5.7 trillion (USD 409 million) will be poured in to operate the airport for the next 25 years.

Airport management projects of interests to foreign firms include Kuala Namu in Medan, North Sumatra, Sam Ratulangi, Manado, North Sulawesi and Singkawang, West Kalimantan. Investment required for the first two airports can reach IDR 8 trillion (USD 573 million). As part of the country’s regulatory requirements, members of consortium interested to take on the project will need to register as Indonesian business entities before the project starts.

Indonesia continues to focus on Infrastructure building as President Joko Widodo starts his second presidential term. A total investment of USD 430 billion on Infrastructure is expected to be allocated between 2019 – 2024.

(Sources: Reuters; Jakarta Globe)

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