Indonesia to tender 10 airport PPPs

Jakarta has shortlisted three airports for the first auction, as part of a plan to increase its spending on aviation infrastructure by up to six-fold over the next five years.

Indonesia is about to kick off an ambitious plan to build up its regional aviation infrastructure, according to the country’s Ministry of Transport.

Government officials have announced the first phase of a public-private partnership (PPP) to develop regional airports by opening management bids for Bandar Lampung Radin Inten II, Komodo and Palu Mutiara Airports. This is the first batch of ten airports lined up for the privatisation drive and the bid processes will commence in the coming months.

The three platforms are seen as the most likely to attract a significant number of competitive bids, with at least one airline – Indonesia’s national flag carrier Garuda – having already expressed interest in running Komodo Airport.

The other seven airports considered in the scheme are Bengkulu, Jayapura Sentani, Matahora, Palangkaraya Tjilik Riwut,Tanjung, Tarakan Juwata andTernate Babullah.

The move comes amid calls for a boost in Indonesian airport PPPs to accommodate increased air traffic across the archipelago. Jakarta’s Soekarno-Hatta International Airport, which recorded 62.1 million passengers at the end of last year, is the eighth-busiest airport in the world.

The policy also comes prior to the implementation of the 2009 ASEAN Open Skies agreement in Indonesia next year, which aims to create a free market environment for the airline industry across the 10 members of the south-east Asian grouping.

Estimates by Indonesia’s National Development Planning Agency suggest that the country needs to spend more than $15 billion on airports between 2015 and 2019 to improve standards and raise capacity.

The agency has singled out the expansion of the Soekarno-Hatta and Medan’s airports as well as the development of an airport in Karawang, West Java, as priorities for the government. It also calls for the construction of 45 new airports in more remote parts of Indonesia.