STUDY ON ECONOMIC PARTNERSHIP PROJECT IN DEVELOPING COUNTRIES IN FY 2012

STUDY ON MUSIRIVER CROSSING BRIDGE PROJECT IN THE REPUBLIC OF

FINAL REPORT

【SUMMARY】

February 2013

Prepared for:

The Ministry of Economy, Trade and Industry

Ernst & Young Shin Nihon LLC

Japan External Trade Organization (JETRO)

Prepared by:

Mitsui Consultants Co., Ltd.

Chodai Co., Ltd.

Infrastructure Development Institute- Japan 1 Background and Necessity of the Project

1.1 Background and Necessity of the Project Due to the petroleum, gas, palm oil, rubber and other abundant resources and growth of key industries, City in the province of South in Indonesia is positioned as a priority development area in the Indonesia Economic Development Corridor (IEDC) concept. Because of this, the population of Palembang City is increasing every year (Rate of increase in population: 2.07% [Average increase in Indonesia: 1.18%]), with the population exceeding 1.5 million in 2011, making it the second largest city in Sumatra. Urban functions are expanding from the old urban area in the north part of the city with the building of residential properties, plants, and commercial areas in the south and east parts of the city.

However, there are only two bridges which cross the Musi River that flows from the west to the east through the center of Palembang City, the Ampera Bridge and Second Musi River Bridge, with the city divided in a north-south direction. Therefore, traffic is concentrated on the Ampera Bridge, which is the only bridge in the center of the city, and the resulting traffic jams are the foremost problem for the city, causing enormous economic losses.

Due to these circumstances, construction of a new bridge crossing the Musi River is a very high priority project for not only Palembang City but for Indonesia as a whole, and this project has been listed on the “Blue Book 2011 – 2014” by BAPPENAS. In addition, a ring road with a total length of 25 km that includes this project has been planned by BINA MARGA, and a FS was conducted for this project with Indonesian funds in 2010, with detailed design started in November 2011. Implementation of this project is of something that is of high necessity for Indonesia.

1.2 Current Status and Issues of Musi River Bridges Currently, there are two bridges that are in service on the Musi River, the Ampera Bridge in the center of Palembang City (completed in 1965), and the Second Musi River Bridge in the western part of Palembang City (completed in 1994). The Ampera Bridge was built 50 years ago, but extentive repair work was performed in 1992, at which time the concrete deck slabs were replaced and repair and reinforcement were also performed on the bridge piers.

The results of a visual survey of the Ampera Bridge and Second Musi River Bridge indicated that the paint has deteriorated to a certain extent, but no damage that may require urgent cares was found. In addition, the volume of traffic on both bridges was found to be high high, and the observation revealed that an alternate bridge is required when repair work is performed on these bridges in the future.

2 Basic Policy for Determining Project Content

2.1 Location, Topographic Features and Natural Conditions for Project The geography, geological conditions, climate, weather and river conditions of the target region are shown in Table i.

Table i Geography, Geological Conditions, Climate, Weather and River Conditions in Target Area Overview

Geography /  The area around Palembang City is flat, and there are many lowland swamps. Geological  According to a boring study that was implemented this time, there is tightly packed ground at a Conditions depth of 20m or more (N value at depth of 20m or more is 30 or higher). Climate /  The area has a tropical rainforest climate, with high temperatures and humidity throughout the Weather year. (Monthly average temperature ranges from 26C to 28C, monthly average humidity ranges from 78% to 87% and yearly average rainfall is approximately 2,500mm.)  Rainfall volume is relatively low during the dry season from June to September (Monthly average rainfall: Approximately 100mm)  Winds are generally mild (Monthly average wind speed of 3 m/s or less). Musi River  In the target region for this study, the gradient of the Musi River is flat, the river width is wide, Overview with a tendency for sand drifts to be deposited.  The water level is influenced by the tides, and periodically fluctuates. However, saltwater intrusion does not occur.  Since the land in the Palembang City region is low lying, the city is easily inundated with water. Shipping  There are petroleum and other plants in the target area on the Musi River for this study, with Channel tanker and other large ship traffic on the river (Channel width: 240m, Min. height: 50m)  The Musi River bed is dredged to prevent sediment from impeding ship traffic.  Palembang City is in an area that has a comparatively low level of impact from earthquakes. Source: Prepared by Study Team

2.2 Transport Demand Forecast 2.2.1 Transport Demand Forecasting Methods After reviewing the traffic volume forecast conditions and the results of the FS for the Musi III Bridge conducted in 2010, the reduction ratio in traffic volume on the Musi III Bridge due to toll resistance (reluctance to pay toll) was calculated.

2.2.2 Traffic Demand Forecast Results The traffic volume on the Third Music River Bridge and ring road in each year in which an estimate was made in the traffic demand forecast results in the FS for the Third Bridge conducted in 2010 are shown in Figure i. The traffic indicates increases in accordance with the increase in OD traffic volume, and in particular, since six bridges to cross the Musi River (Total of 9 bridges including two existing bridges and Musi III Bridge) will be built by 2025, traffic volume will exceed 40,000 vehicles.

Figure i Transition in Traffic Volume on Musi III Bridge

(pcu/d)

45,000 40,759 40,000 35,000 26,649 30,000 25,000 20,723 20,000 15,000 10,000 5,000 0 2016 2020 2025

Source: Prepared by Study Team Based on STUDI KELAYAKAN JALAN DAN JEMBATAN MUSI III PALEMBANG

2.2.3 Setting of Traffic Volume Reduction Ratio by Changing into Toll Road The reduction ratio due to toll resistance that was calculated using the ratio of use calculated for each toll settings and OD traffic volume that will use the Musi III Bridge is shown in Table ii. The results of the reduction ratio calculations are shown in Table ii.

Reduction ratio = Toll setting traffic volume ÷ Traffic volume when free (= Case 0) Toll setting (case) traffic volume = ΣA + (ΣB x Musi III Bridge usage ratio) ΣA :OD that use MusiIII Bridge regardless of toll ΣB :OD for which Musi III Bridge usage varies depending on toll

Table ii Results of Musi III Bridge Reduction Ratio Calculation Due to Toll Resistance Toll Setting Musi Ⅲ Musi Ⅲ Case ΣA ΣB Reduction Ratio (Rp/Number・km) usage ratio Traffic Volume Case0 0 100 % 9,197 100.0 % Case1 300 89 % 8,765 95.3 % 5,268 3,929 Case2 600 79 % 8,372 91.0 % Case3 900 61 % 7,665 83.3 % Source: Prepared by Study Team

2.2.4 Change in Traffic Flow with Building of Musi III Bridge (1) Calculation Method Due to the fact that the traffic volume crossing the Musi River on each bridge cannot be determined from the traffic demand forecast results in the FS for the Musi III Bridge conducted in 2010, the change in traffic flow in the event that the Musi III Bridge is built was predicted based on the OD table from 2010.

(2) Change in Traffic Flow Caused by Building of Musi III Bridge The results of calculation of the traffic volume using each bridge to cross the Musi River are shown in Figure ii.

Figure ii Change in Traffic Flow Caused by Building of Musi III Bridge Route

Without Musi III bridge

110,000pcu/d

48,000pcu/d

With Musi III Bridge

67,000pcu/d

43,000pcu/d

48,000pcu/d

Traffic Shift from Ampera Bridge to Musi III Bridge

Source: Prepared by Study Team

2.2.5 Route Plan (1) Basic Policy for Route Plan In the FS for the Musi III Bridge project that was conducted in 2010, the routes shown in Figure iii were planned. In the route plan that was studied at this time, the route plan used in the FS 2010 was taken into consideration in an effort to match it with the east ring road plan for the roads other than Musi III Bridge and the approach section. The route used in the FS 2010 will be adhered to, a comparative review with Musi III Bridge and the roads in the approach section will be performed, thereafter the route will be selected.

However, since it is necessary to perform project evaluation for the entire east ring road, a comparative review will be performed for theMusi River crossing bridge and the approach section, with all sections of the east ring road.

Figure iii Route Plan

Proposed Route 1 Proposed Route 2 Proposed Route 3 Proposed Route 4 Proposed Route 5 (Adoption Route)

Source: STUDI KELAYAKAN JALAN DAN JEMBATAN MUSI III PALEMBANG

(2) Comparative Review The evaluation results of the routes are shown in Table iii.

Table iii Route Selection Comparison BINA MARGA Original Route Alternative Plan 1 Alternative Plan 2 Alternative Plan 3 Plan Crosses Musi River at Crosses Musi River at Crosses Musi River at a Crosses Musi River at a Overview an angle from Northeast an angle from Northeast right angle in center of right angle at upstream to Southwest to Southwest Kemarau Island side of Kemarau Island Plane View

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Connection with ring road -

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Musi River Existing road

環境チェックリスト Oil terminal Plant Kemarau Island

Built-up area

Plant Temple

BINA MARGA FS plan road Existing Connection with ring road Alternative plan 1 Built-up area Under Development Built-up area Connection with ring road AlternativeBINA MARGA plan plan 2

Alternative plan ①

AlternativeAlternative p plan ② 3 Plant

Main Bridge Cable-Stayed Bridge / Cable-Stayed Bridge / Extradosed Bridge / Extradosed Bridge / Type / L=3.8km L=3.8km L=3.8km L=3.9km Bridge Length

Good Traffic Volume Fair Fair Fair Coloser to center of Palembang city Land Usage Good Good Good Good

Fair Fair Social Good Good Considerations Pass near Chinese Pass near Chinese temple and industrial temple and industrial facilities facilities 24.5 billion yen (2.8780 trillion Rp) 3 26.2 billion yen 24.0 billion yen 30.3 billion yen Cost *DD(Detail Design) Plan (3.0750 trillion Rp) (2.8170 trillion Rp) (3.5570 trillion Rp) (Under Implementation) 24.5 billion yen (2.8780 trillion Rp) Evaluation Fair Good Good Fair Source: Prepared by Study Team

3 Overview of the Project

3.1 Project Content This project includes construction of a bridge with a total length of 3.3 km. Efforts will be made during the project to match the Plan for a bridge that crosses the Musi River which is part of the Palembang City east ring road plan, located approximately 5 km on the downstream side of the road bridge (Ampera Bridge) over the Musi River, in the center of Palembang City, which shows significant extent of deterioration. Figure iv shows a general plan for the bridge.

[Alternative plan 1] 表

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This bridge type is Cable-Stayed Bridge. The length of 360.0m was selected as the main span in order to provide a -

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shipping channel width of B=240.0m due to the influence of the bridge crossing the river at an angle. The economic span 環境チェックリスト on the left bank side of the Musi River is approximately 110m due to the placement of bridge piers in the river since coffering and pier works are required.

[Alternative plan 2] This bridge type is Extradosed Bridge. The length of 270.0m was selected as the main span which satisfies shipping

channel width of B=240.0m. The economic span on the left bank side of the Musi River is approximately 110m due to the placement of bridge piers in the river since coffering and pier works are required.

[Alternative plan 3] This bridge type is Extradosed Bridge. The length of 270.0m was selected as the main span which satisfies the shipping channel width of B=240.0m. The bridge is positioned at a located where a tributary of the Musi River branches off. Furthermore, since ships navigate on the tributary, a span length of 270m was selected.

Figure iv General Plan for Bridge

Alternative Plan 1

Alternative

表 Plan 2

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-

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環境チェックリスト

Alternative Plan 3

Source: Prepared by Study Team

3.2 Total Project Cost The approximate construction costs at this junction for this project are shown in Table iv, which amounts to approximately 21.2 billion yen. When it is assumed that fee for consultants and contingency funds will each amount to 10% of construction costs, the total project costs including these fees and expenses added amount to approximately 30.8 billion yen.

Table iv Estimated Construction Costs Item Consultant Consultant Remarks

Cost Cost 表

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(Million Rp) (Million Yen) 5

Main Bridge Superstructure 1,096,000 9,340 Bridge Length1460m 環境チェックリスト (PC Cable-Stayed Bridge Substructure 917,000 7,810 Max Span 360m + PC Box Girder Bridge) Subtotal 2,013,000 17,150

Superstructure 417,000 3,550 Bridge Length 600m Approach bridge Substructure 558,000 4,750 Span 40+70+140+70+7x40m (PCT Girders Bridge Subtotal 975,000 8,300 Bridge Length 1320m + PC Box Girder Bridge) Span 33x40m Construction of Temporary Structures 235,000 200 material yard , Girder Production Yard etc. Construction Cost (1) Total 3,223,000 25,650

Consultant Cost (2) 322,000 2,570 10% of ① Contingency Fund(3) 322,000 2,570 10% of ①+② Total Construction Cost (1+2+3) 3,867,000 30,790 About 30.8 Billion Yen Source: Prepared by Study Team

3.3 Result on Financial and Economic Evaluation 3.3.1 Costs The costs that were included in the preliminary financial and economic analyses include land acquisition, resettlement relocation of utilities, construction, and operation and maintenance costs. Out of these costs, the land acquisition cost, resettlement cost and cost for relocation of utilities were not included in the preliminary financial analysis since it was assumed that the government would cover these costs. On the other hand, all of the above mentioned costs were included for the preliminary economic analysis.

(1) Land Acquisition, Resettlement and Relocation Cost The costs for land acquisition, resident resettlement, relocation of utilities and other items in the area that is influenced by this project (bridge and road development work) are estimated to be approx. 733.3 billion Rp.

(2) Construction Costs The costs for construction of the bridge and for a road length of approximately 25 km are included in the construction costs. Table v shows a comparison of the construction costs for BINA MARGA FS, Alternative plan 1, 2 and 3.

Table v Construction Costs 表

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(Unit: billion Rp, Values in parentheses are 100 million yen) -

5 BINA MARGA FS Alternative Plan 1 Alternative Plan 2 Alternative Plan 3

環境チェックリスト Structure (Bridge) 2,878(245) 2.987(254) 2,698(230) 3,379(288) Road 555(47) 555(47) 555(47) 555(47) Total 3,433(292) 3,542(302) 3,253(277) 3,934(335) Note: Converted at Rp = ¥0.008519 Source: Prepared by Study Team

(3) Operation, Maintenance and Other Costs An amount equal to 2% of the construction costs/y is estimated for the daily maintenance and management expenses, and an amount equal to 2% of the construction estimated per five years is estimated for periodic repair costs. It is thought that periodic repair costs will be incurred every five years after the bridge is placed in service / operation.

3.3.2 Traffic Volume Table vi shows the estimated traffic volume used as the basis for the preliminary financial and economic analysis. The traffic volume in 2014 is 29,885 pcu, 35,595 pcu in 2020, and 49,776 pcu in 2025. The assumption was made that the traffic volume would increase at a yearly rate of 6.5% from 2025 to 2040, reaching the saturated level of approximately 100,000 pcu in 2038, and assumed to remain constant thereafter.

Table vi Estimated Traffic Volume 2014 2020 2025

Northbound Southbound Total Northbound Southbound Total Northbound Southbound Total a, Bina Marga 9,932 9,992 19,924 11,992 11,738 23,730 17,054 16,129 33,184 FS(Vehicles/Day) b, pcu(a X1.5) 14,898 14,988 29,885 17,989 17,607 35,595 25,582 24,194 49,776 Source: Pekerjaan Studi Kelayakan Jalandan Jembatan Musi III Palembang, Average/PCU (×1.5) Prepared by Study Team

3.3.3 Overview of Preliminary Financial Analysis The financial analysis used 2016 as the base year when the bridge is placed in service for evaluation purposes. Table vii, it is assumed that the yearly rate of inflation from 2010 when the FS that was conducted by BINA MARGA until 2016 when construction is scheduled to begin will be 8.5%, and rates were converted to the price level as of 2016, with the financial internal rate of return calculated for the BINA MARGA FS, alternative plan 1, 2 and 3 at the respective toll settings of 500 Rp (approx. ¥4.3)/km, 1,000 Rp (approx. ¥8.5)/km and 1,500 Rp (approx. ¥12.8)/km.

Due to the fact that a financial rate of return of approximate13 – 15% which is generally expected in Indonesia cannot be

achieved for any of the rates or any of the plans or alternative plans, it means that this project does not qualify itself as a 表

4 genuine private sector toll expressway (BOT project). In order to make this project viable, in addition to the government -

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funding intend for site acquisition, resettlement and facility relocation, financial support for the project such as government 環境チェックリスト assistance measures that consist of government subsidies, tax incentives or low-interest loans are essential arrangements.

Table vii Financial Internal Rate of Return BINA MARGA FS Alternative Plan 1 Alternative Plan 2 Alternative Plan 3 500Rp/km 4.1% 3.9% 4.4% 3.3%

1,000Rp/km 9.6% 9.3% 10.0% 8.5% 1,500Rp/km 12.8% 12.5% 13.3% 11.6% Source: Prepared by Study Team

3.3.4 Overview of Preliminary Economic Analysis The economic analysis consisted of an evaluation based on the year 2010 which was used as the basis for the FS conducted by BINA MARGA. The vehicle travel costs with different vehicle types and at travel speeds in 2010 are shown in Table viii, and a list of the time reduction benefits per vehicle in the respective vehicle types is given in Table ix, referring to the BINA MARGA FS. In this FS, the time reduction benefits were converted into the price level as of 2010, and the economic feasibility of this project was evaluated.

Table viii Vehicle Travel Cost for Each Vehicle Type and Travel Speed (2010) (Unit:Yen/Vehicle km, (Rp/vehicle km)) Velocity (km/h) Car Truck Bus 20 21.8(2,557) 72.1(8,469) 55.1(6,472) 30 18.7(2,195) 61.9(7,268) 47.3(5,554) 40 16.2(1,906) 56.4(6,619) 41.8(4,906) 50 14.4(1,693) 52.5(6,160) 37.7(4,428) 60 13.2 (1,554) 50.4(5,918) 35.2(4,134) 70 12.7 (1,490) 50.4(5,921) 34.4(4,033) 80 12.8(1,501) 52.8(6,200) 35.2(4,133) 90 13.5(1,587) 57.7(6,774) 37.8(4,441) 100 14.9(1,747) 65.3(7,665) 42.3(4,967) Note: Converted at Rp = ¥0.008519 Source: Pekerjaan Studi Kelayakan Jalandan Jembatan Musi III Palembang, Yen conversion made by Study Team.

Table ix Travel Time Reduction Benefits (Unit: Yen/Vehicle·Hour,(Rp/Vehicle·Hour)) Study Agency / Study Name Study Year Vehicle Truck Bus 104.7 157.9 117.3 PT JasaMarga 1996 (12,287) (18,534) (13,768) 60.2 125.0 31.2 JIUTR northern extension (PCI) 1989 (7,067) (14,670) (3,659) Note: Converted at Rp = ¥0.008519 Source: Pekerjaan Studi Kelayakan Jalandan Jembatan Musi III Palembang

During the evaluation of economic feasibility, externality (external effects) was taken into consideration. The increase in land prices in the area surrounding the development sections (bridge, road), expansion of the urban area, stimulation of 表

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- economic activity and other benefits are included in externality (external effects). 5

環境チェックリスト Table x shows the economic internal rate of return when the said project is implemented as a free road or a toll road (with toll charges of 300Rp (¥2.6/km), 600Rp (¥5.1/km) and 900Rp (¥7.7/km)) for BINA MARGA FS, alternative plan 1, 2 and 3. The economic internal rate of return of this project exceeds the opportunity cost of capital in Indonesia (about 13 – 15%) in all cases, and is at a level that exceeds the hurdle rate of 15-16% that is the general standard requirement of yen loans and

STEP projects as well

Table x Economic Internal Rate of Return BINA MARGA FS Alternative Plan 1 Alternative Plan 2 Alternative Plan 3 Free 17.2% 17.0% 17.7% 16.1% 300Rp/km 16.7% 16.5% 17.1% 15.6% 600Rp/km 16.2% 16.0% 16.6% 15.2% 900Rp/km 15.3% 15.1% 15.7% 14.3% Source: Prepared by Study Team

Table xi shows the net present value for each route (FS, alternative plans) and each toll setting (including free) when a discount rate of 12.5% is used, and Table xii shows the cost-benefit ratio.

Table xi Net Present Value (Unit: 100 million yen, Values in parentheses are 100 million Rp) BINA MARGA FS Alternative Plan 1 Alternative Plan 2 Alternative Plan 3 Free 19,275(164) 17,968(153) 19,681(168) 14,776(126) 300 Rp./km 16,902(144) 15,596(133) 17,309(147) 12,403(106) 600 Rp./km 14,732(126) 13,425(114) 15,138(129) 10,233(87) 900 Rp./km 10,845(92) 9,539(81) 11,252(96) 6,346(54) Note: Converted at Rp = ¥0.008519 Source: Prepared by Study Team

Table xii Cost-Benefit Ratio BINA MARGA FS Alternative Plan 1 Alternative Plan 2 Alternative Plan 3 Free 1.62 1.58 1.68 1.46 300Rp/km 1.54 1.51 1.60 1.39 600Rp/km 1.47 1.44 1.53 1.33 900Rp/km 1.35 1.32 1.40 1.22

Source: Prepared by Study Team 3.3.5 Consideration Judging from the results of the preliminary financial and economic analyses hereof, materialization of this project as a toll road project coupled with appropriate participation by the private sector is more realistic solution than doing it as a public project free road should this project are provided with suitable financial assistance. In addition to reducing the financial burden on the government by utilizing private sector funds in case the parties agree to implement it as a private sector toll road, one can expect higher quality services in O&M by utilizing private sector knowhow and experience in maintenance and management.

Development of the legal system related to utilization of the private sector has shown progress in recent years, and work is 表

4 proceeding on quite a few projects that utilize the private sector to develop toll roads. Although there are fewer cases in -

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which road projects have been developed using PPP compared to cases in which development has been performed using 環境チェックリスト BOT, many project candidates will be qualified on the PPP project list such as the Palembang – Indralaya Toll Road which is adjacent to this project. Also, there are cases in which work has already began, such as the Solo – Kertosono Toll Road. This project therefore can be developed under PPP scheme should suitable support by the government be provided.

3.4 Evaluation of Environmental and Social Impacts

3.4.1 Analysis of Current Situation (Environmental/Social) Current situation of the area surrounding the project site is shown in Figure v.

Figure v Current Conditions Surrounding Project Target Site

1. Center of the City 2. Pagoda in Kemaro Island 3. Swamp Area

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3 4 1

2 5

6 4 Project Site

6. Industrial Facilities 4. Residential Area 5. Settlements along the along the Musi River Musi River Source: Prepared by Study Team Based on Study Results

(1) Air Quality The levels of nitrogen dioxide, sulfur dioxide, carbon monoxide and other air pollutants along the roads in the center of Palembang City satisfy the environmental standards of Indonesia.

(2) Water Quality The level of organic substances and hazardous substances in the Musi River that flows through the center of Palembang City all exceed the levels prescribed by environmental standards, and tend to be higher in the downtown and downstream areas.

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(3) Noise / Vibration -

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Noise along the road in the center of Palembang City exceeds the levels prescribed by the environmental standards of 環境チェックリスト Indonesia.

(4) Natural Environment Source: Prepared by Study Team Based on Study Results The target area for this plan does not contain protected region and is not the habitat for a precious species that requires protection as prescribed by the laws of Indonesia, international treaties or other conventions. However, due to the fact

there are swamps (Figure. v) surrounding the access road (northeastern area) for Palembang City, it can be inferred that there are ecosystems for a diverse range of animals and plants in these swamps. Accordingly, an adequate review of the impact on these swamps and the ecosystems that are there needs to be performed during project implementation.

(5) Presence of Residences It has been confirmed that there are squatters along the banks of the Musi River (Figure. v). There are not any ethnic minorities or indigenous people in the target area for this project.

(6) Historical / Cultural Assets There are not any historical or cultural assets / heritages that have been designated for conservation by law in the target area for this project, but certainly there is a Pagoda (Chinese temple) at the west end of Kemarau Island which will be crossed by the Musi III Bridge (Figure. v). A review needs to be made to ensure the erection construction site so that the bridge will not have an impact on this Pagoda. In addition, due to the fact that the mosques that are in each village are precious facilities from historical, cultural and religious view point, appropriate consideration must be paid by the implementing organizations/authorities concerned the project.

3.4.2 Environmental Impact Mitigating Effect (1) Reduction of Air Pollutants and Greenhouse Gases The capacity of the second bridge that crosses the Musi River which flows through the center of the Palembang City is inadequate, and this has resulted in heavy road congestion which pose serious constrains. Therefore, the construction of a new alternate route will alleviate traffic jams in the center of the city, suppress exhaust gas emissions which are caused by road traffic, and will reduce the volume of fuel consumed, all leading to the enhancement of a low carbon environment.

Here, the reduction in exhaust gases (NOx), greenhouse gases (CO2 (carbon conversion) and fossil fuel usage volume

caused by idling in traffic jams was estimated from the predicted traffic volume (in 2014) on the Musi III Bridge based on 表

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the traffic demand forecast results in the FS for the Musi III Bridge conducted in 2010. Those assumed conditions for -

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calculation are described below. 環境チェックリスト

・ Emissions volume is increased by traffic jams (idling) on the main arterial road that runs through the center of the city in a north-south direction. ・ Traffic jams on the main arterial road that runs through the center of the city in a north-south direction will be alleviated by the traffic volume that is predicted to use the Musi III Bridge in the FS that was conducted in 2010,

eliminating emissions due to idling. ・ The traffic volume obtained from the results of a field study (Ampera Bridge) during this work was used as the traffic volume on the arterial road. ・ The estimated traffic volume in fiscal 2014 in the FS was used as the traffic volume on the Musi III Bridge. ・ The emissions volume due to idling was calculated using the basic unit prescribed by a study of the Tokyo Metropolitan Research Institute for Environmental Protection and the formula shown below.

g vehicles Emissions due to idlind in traffic jams ( ∙ h) = Traffic volume per hour ( ) basic unit (g) 10 min h ) The above results estimate that the implementation of this project will reduce emissions/fuel usage due to idling per 10 minutes in peak hour traffic by the following respective amounts: 65% for nitrogen oxide emissions, 43% for carbon dioxide emissions and 43% for fossil fuel usage volume.

(2) Other Environmental Mitigating Effects The Traffic shifting to the Musi III Bridge from existing bridges will alleviate traffic jams in the center of Palembang City, and the flow of automobiles at a constant speed is expected to improve the noise emitted by automobiles.

3.4.3 Impact of Project Implementation upon Environmental and Social Aspects The environmental and social impact involved with the implementation of this project is shown in Table xiii.

Table xiii List of Envisioned Environmental and Social Impacts Environmental Envisioned Impact, etc. Measures to Avoid/Alleviate Impact Items ・ Smoothing of work processes / use of good quality fuel, Implement adequate inspection / ・ Exhaust emission by maintenance of construction machinery and ships, construction Observe speed regulations for vehicles Air Pollution machinery/ships transporting materials / Implement idling stop ・ Concern regarding further policy / Provide guidance to construction increase in traffic volume companies on prohibition of overloading ・ Promote modal shift and further develop current public transport organizations (buses) ・ Muddy water from ・ Provide settling pond to alleviate discharge of 表

Water Pollution 4

construction site muddy water -

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・ Smoothing of work processes and prohibit construction at night, Implement adequate 環境チェックリスト inspection / maintenance of construction machinery and ships, Observe speed regulations for vehicles transporting materials / Implement ・ Noise due to operation of idling stop policy / Provide guidance to Environmental construction construction companies on prohibition of Considerations equipment/ships overloading, Placement of noise insulation sheets, Noise/Vibration ・ Concern about low - Placement of noise mufflers

frequency sound from ・ Provide sound insulating walls and plant trees bridge and further along road as necessary, Adopt pavement with increase in traffic volume good drainage properties, Use of “no joint” system on bridge section, improve joints, minimize pavement level difference ・ Promote modal shift and further develop current public transport organizations (buses) ・ Byproduct of construction ・ Reuse byproducts of constructions as much Waste process as possible, implement recycling program ・ Implement measures to deal with following issues: Noise, vibration, muddy water, dust, exhaust gases. Dispose of waste in appropriate manner Ecosystem ・ Causing change in habitat ・ Minimize alteration of landscape (select routes utilizing existing roads, etc.), Create alternative habitat as necessary Social Resettlement of ・ Need for resettlement of ・ Implement measures to deal with following issues: Considerations Residents residents Noise, vibration, muddy water, dust, exhaust Living and ・ Traffic restrictions / traffic gases. Dispose of waste in appropriate manner, Livelihood jams in construction area Formulate construction plans that reflect traffic ・ Land usage and means of conditions and establish alternative routes livelihood will be changed ・ Minimize alteration of landscape (select routes Landscape ・ Causing change in view / utilizing existing roads, etc.) landscape Source: Prepared by Study Team

3.4.4 Items to be Achieved by the Government (including implementation agencies and related organizations) for Implementation of Project (1) Implementation of EIA According to Project Category The project implementation agency shall implement the KA-ANDAL (Environmental Impact Analysis Implementation Plan), ANDAL (Environmental Assessment Analysis) and other environmental impact assessment procedures, and obtain an approval letter from the BLH ([Regional Environmental Management Agency]: Approval agency the government, province governor or mayor depending upon project content), which is the agency that approves projects. The RPL (Environment Monitoring Plan) and RPL (Environment Management Plan) shall be prepared and submitted to the BLH.

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(2) Review of Alternative Plan -

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The environmental impact and number of residents that need to be resettled will vary subject to the line form of the 環境チェックリスト bridge section and access route. Therefore, the project implementation agency shall review these alternative plans from the standpoint of environmental and social impact at the stage of full-fledged FS that is to be performed in the future.

(3) Implementation of LARAP The project implementation agency shall comprehend the number of residents that need to be resettled during the

research in the EIA, and at the same time shall formulate a LARAP (Land Acquisition and Resettlement Action Plan). Then, compensation policy shall be specified.

(4) Consensus Building with Area When this plan is implemented, tIt is very likely that this project will have environmental and social impact/effect on the surrounding area, such as the resettlement of residents, interference with existing traffic flow, removal of structures, generation of noise / vibration and in various dimensions. Therefore, the project implementation agency shall carry out public consultation at an early stage of project implementation in order to build consensus with the area.

4 Implementation Schedule

The implementation schedule for this project that is programmed at this point is shown in the table below assuming that this project is developed as a public project and that it is developed as a PPP project. And, should this project be realized under PPP scheme, a detailed and precise feasibility study must be made on top of the study that has already been completed by BINA MARGA, the FS that has already been completed by BINA MARGA.( Refer to Table xiv, Table xv )

Table xiv In case of Implemented as Public Project

4

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5

環境チェックリスト

Source: Prepared by Study Team

Table xv In case of Implemented as PPP Project

Source: Prepared by Study Team

5 Project Location Map

Figure vi Project Location Map

Indonesia

South Sumatra Province 表

4

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5

環境チェックリスト

Palembang City

Project Site

Source: Map of Indonesia – Prepared by Study Team Province Map – National Land Survey Institute (BAKOSURTANAL: Badan Koordinasi Survey dan Pemetaan Nasional) / Palembang City Map and Planned Site for Construction of Bridge Crossing Musi River – DINAS PERHUBUNGAN KOTA PALEMBANG