1.1 Article Identity
Title            : "Genjot Pembangunan Transportasi, Kemenhub Makin Tingkatkan Peran Pendanaan Kreatif"
Media          :  Biro Komunikasi dan Informasi Publik Kementerian Perhubungan Republik Indonesia (Article)
Date Published : Â February 13, 2022
1.2 Background
In Indonesia, there are limited development budgets provided by the state to build and develop national transportation facilities that are increasingly in need of attention. The Ministry of Transportation (Kemenhub) is aware of this and is working to increase the role of creative funding and other financing models as an alternative source of development financing in the transportation sector.
In the Strategic Plan of the Ministry of Transportation for 2020-2024, there is a large financial need for the development of national transportation infrastructure. However, the budget allocation provided by the State Revenue and Expenditure Budget (APBN) is still far below this requirement. Therefore, the Ministry of Transportation relies on non-APBN creative funding or Creative Financing through various schemes, such as Government and Business Entity Cooperation (PPP), Utilization Cooperation (KSP), increasing the role of State-Owned Enterprises (BUMN), State Sharia Securities. (SBSN), as well as pure private investment.
Creative funding is focused on strategic infrastructure and high economic value. Apart from creative funding, the Ministry of Transportation also noted an increase in sources of income from Non-Tax State Revenue (PNBP) and Public Service Agencies (BLU) within the Ministry of Transportation. The percentage of PNBP and BLU funding sources to the total budget ceiling continues to increase from year to year. PNBP and BLU have an important role in financing the increase in Transportation Human Resources (HR) and infrastructure in underdeveloped, remote, outermost and border areas.
Creative funding will continue to be optimized through PPP schemes, KSP, increasing the role of SOEs, SBSN, and pure private investment. The minister also reminded that PNBP and BLU should continue to be increased, and hoped that the portion of creative funding would increase to finance development in the transportation sector. Minister of Finance Sri Mulyani hopes that the Ministry of Transportation can optimally utilize the State Budget and maximize existing state assets in supporting the economy and people's welfare.
1.3 Critical Review
1.3.1 Financing Problem
The financing problem in the development of national transportation infrastructure in Indonesia stated that therehere is a significant gap between the cost requirement which reaches IDR 711 trillion and the budget allocation provided by the APBN of IDR 340.16 trillion. This shows the limitations of the state budget in financing the increasing infrastructure development.
1.3.2 Agencies/Parties Involved
The parties that are involved are The Ministry of Transportation as the main institution involved in overcoming the financing problem. Other than the ministry of transportation, the minister of finance as well as the private sector are also involved in the proposed program. The Minister of Transportation Budi Karya Sumadi has expressed his commitment to increase the role of creative funding through Business Cooperation (PPP) schemes, Utilization Cooperation (KSP), increasing the role of State-Owned Enterprises (BUMN), State Sharia Securities (SBSN), and pure private investment. The article also mentions the role of the Minister of Finance Sri Mulyani in providing guidance to the Ministry of Transportation regarding the optimization of state assets and the use of the state budget.
1.3.3 Solutions Offered
The solutions offered to address the financing challenges in the development of transportation sector is to optimize creative funding through PPP schemes, KSP, increasing the role of SOEs, SBSN, and pure private investment. Creative funding will be focused on strategic infrastructure and high economic value, while APBN funding will be allocated to increase Transportation Human Resources (HR) and development in disadvantaged, remote, outermost, and border (3TP) areas which are financially unprofitable.
1.3.4 References
In the paper "Blended Finance: Between the Benefits and Challenges in Its Application" by Eko Agus Purwanto and Muhammad Bagus Alfian, the concept of blended finance is explained as an effort to optimize the use of development financing instruments to mobilize commercial financing. Blended finance involves an important role in development finance, additional finance, and sustainable development in achieving sustainable development goals. This approach can be a solution to overcome the limited budget for transportation infrastructure development. This article also quotes the Minister of Finance Sri Mulyani who acknowledged the vital role of the transportation sector in the recovery of the national economy. The importance of transportation connectivity and the availability of connected transportation modes as supporting factors for economic recovery was also highlighted.
1.3.5 Comments on Solutions Offered
I agree with the Ministry of Transportation's efforts to increase the role of creative funding as an alternative source of financing. Involving the private sector in financing transportation infrastructure can help overcome the limitations of the state budget. Creative funding such as PPP, KSP, and pure private investment schemes can provide the additional funds needed to build the necessary infrastructure.
However, it should be remembered that the use of creative funding must be accompanied by transparency, accountability and attention to the interests of society. Infrastructure projects must consider their impact on the environment, sustainability, and the welfare of local communities. In addition, it is important to involve relevant stakeholders in the project planning and implementation process so that their interests are represented.
1.3.6 Conclusion:
The Ministry of Transportation's efforts to increase the role of creative funding as an alternative source of financing for transportation infrastructure development is a positive step. Engaging the private sector and using creative funding can help overcome the constraints of
the state budget. However, it is important to ensure transparency, accountability and take into account the interests of the community in project implementation. The references mentioned provide a deeper understanding of the concept of blended finance and the importance of sustainable financing in development.
1.4 Article
The original article can be access through: https://dephub.go.id/post/read/genjot-pembangunan-transportasi,-kemenhub-makin-tingkatkan-peran-pendanaan-kreatif
