WEST PROVINCE REGIONAL PLANNING AND DEVELOPMENT

ACCELERATING WEST JAVA INFRASTRUCTURE DEVELOPMENT THROUGH CREATIVE FINANCING SCHEME

Mohammad Taufiq Budi Santoso Head of West Java Regional Planning and Development Agency

Indonesia Infrastructure Development Financing 6th November 2019 AREA 3 METROPOLITAN As a National Activity 3,54 million Ha WEST JAVA AT GLANCE Center

3rd largest economic POPULATION growth 48,7 million people with the largest Foreign Investment and Domestic METROPOLITAN 1 Investment in (BODEBEKKARPUR) BIJB AND AEROCITY

METROPOLITAN 3 METROPOLITAN 2 (GREATER (GREATER ) ) AIRSTRI P CITARAT HUSEIN E SASTRANEGARA INTERNATIONAL GROWTH AIRPORT CENTER PALABUHA AIRSTRIP TASIKMALAY N RATU RANCABUAYA A AIRPORT Potential Developentof Center for GROWTH tourism and CENTER AEROTROPOLIS fisheries-based RANCA- NUSAWIRU growth BUAYA AIRPORT GROWTH CENTER Center for tourism- Center for tourism and PANGAN based growth agriculture-based - DARAN growth WEST JAVA DEVELOPMENT FUNDING COLLABORATION

Rp. 36,61 T Rp. 49,4 T US$ 2.629,9 mil US$ 3.548,7 mil

NATIONAL LOCAL GOVERNMENT GOVERNMENT BUDGET I (APBD I) BUDGET (APBN) Rp. 92,363 T US$ 6.635,1 mil In Progress

LOCAL GOVERNMENT BANK LOAN BUDGET II (APBD II)

Rp. 14,144 T In Progress REGIONAL PPP Vision: Realization of West Java’s as BONDS US$ 1.016,07 mil a Champion Through Innovation and Collaboration CSR PUBLIC FUNDS Rp. 146,5 M Rp. 880 M US$ 10,5 mil US$ 63,2 mil

Source: PPED (2018) ***Estimated 20 Project CREATIVE FINANCING SCHEMES IN WEST JAVA INFRASTRUCTURE DEVELOPMENT

Regional/Municipal Bonds Regional Government Loan Public Private Partnership

Institutional Strengthening: • Establish Debt Management Unit Institutional Strengthening: (DMU); - Establish PPP Node; • Capacity building for Regional - Cooperation : MoF, Bappenas, SMI, JICA; Government and Regional Parliament; Preparation Phase: - Involve State Owned Enterprises (BUMD); • Regulations for Municipal Bonds - Initial Screening involving PT SMI; - Capacity Building for Human Resources. Provincial Financial Capacity - Fiscal Capacity Assessment; Assessment: - Communication with Regional • DSCR calculation; Principal Parliament; Projects beyond preparation phase: assessment; Tenor assessment; - Project Preparationsupported by - Waste Processing (RDF) Project Lulut Nambo Interest assessment; Sinking fund Development Partners in ; Coordination and consultation: - Waste Processing (WTE) Project Legok • Ministry of Finance Nangka in Bandung. • LKPP • Minister of Home Affairs Project Pipeline: • OJK Projects under preparation phase: • Bilateral/Multilateral Development Partners - Regional Hospitals in - Water Supply Facility in Greater Cirebon; , , - LRT in Greater Bandung; Project Pipeline: • Nusawiru Airport and Tourism Area; - Water Supply Facility in Greater Bandung; • Bandung Railroad System; - Regional Hospital Al Ihsan in Bandung • Regional Hospitals; - Waste Processing Project in Greater Cirebon 1 Jatigede Water Treatment Plant 2 Greater Bandung Urban Mobility 3 Legok Nangka Solid Waste Treatment Plant 4 Greater Cirebon Solid Waste Treatment Plant 5 Greater Bandung (Sinumbra) Water Treatment Plant 18 17 10 6 Geopark Ciletuh Tourism Area 18 7 18 Science Technopark Jatinangor 18 9 8 New Nusawiru Airport 12 19 18 9 Cirebon MICE Complex 4 18 16 10 Patimban Railway Access 13 11 11 Cirebon Ringroad 18 2 7 18 12 Puncak Pass Access Way 1 18 5 14 3 13 Greater Cirebon Liquid Waste Treatment 15 Plant 14 Greater Bandung Retention Pond 19 18 18 15 Greater Bandung Liquid Waste Treatment 6 Plant 18 19 16 Kertajati Railway Access 18 17 Cibungur – Tanjung Rasa Shortcut Railway 18 18 Public Street Lighting 19 19 Regional Hospital: 1. Jampang Kulon Hospital 8 2. Pameungpeuk Hospital 3. Sidawangi Pulmonary Hospital 4. Al-Ihsan Hospital WEST JAVA PPP PROJECTS PLAN

A. UNDER CONSTRUCTION C. UNDER PREPARATION NO. PROJECT NAME CAPEX PROGRESS NO. NAMA PROYEK NILAI PROGRES 1 WTE Lulut Nambo IDR 450 Billion Construction Public Street Lighting in 3 IDR 400 Billion Planning phase Provincial Street IDR 200 Billion for 4 Ciletuh Geopark Tourism Planning phase B. READY TO OFFER accessibility Greater Bandung Waste Water NO. PROJECT NAME CAPEX PROGRESS 5 IDR 200 Billion Planning phase Management Sytem 1 WTE Legok Nangka IDR 3.5 Trillion Transaction Phase 6 Bandung Drinking Water Supply IDR 2.9 Trilion Planning phase 2 Jatigede Drinking Water IDR 2.1 Trillion OBC finisihed 7 Puncak Road II IDR 1.2 Trilion Planning phase Supply 8 Cirebon Ring Road Planning phase 3 Greater Bandung IDR 4.7 Trillion Review OBC Metropolitan Railway documents 9 Railway to Patimban IDR 1.1 Trilion Planning phase

4 WTE Ciayumajakuning IDR 500 Billion Review preliminary 10 Railway to Kertajati IDR 2.7 Trilion Planning phase study PDF request is submitted by 11 Cibungur – Tanjungrasa Shortcut IDR 1.9 Trilion Directorate General of Railways C. UNDER PREPARATION (DJKA) NO. NAMA PROYEK NILAI PROGRES 12 Nusawiru Airport IDR 238 Billion Planning phase 13 Cirebon MICE Area Planning phase IDR 350 Billion – Prepare for the Preliminary 1 Hospital Development Bandung Retention IDR 1.4 Trillion Studies 14 Planning phase Basin Roof Solar Power Plant in Greater Cirebon Waste Water 15 IDR 150 Billion Planning phase 2 Provincial Government IDR 400 Billion Planning phase Management System Buildings PAD : Pendapatan Asli Daerah (Locally Generated Revenue) DAU : Dana Alokasi Umum (General Allocated Funds) BDH : Dana Bagi Hasil Pajak/ Bagi Hasil Bukan Pajak (Tax and Non-Tax Funds Sharing) BW : Belanja Wajib (Mandatory Expenses) WEST JAVA MUNICIPAL BOND Other Fees : Trustee and Credit Rating Agency

Regional Debt Service Coverage Ratio (DSCR) Budget PAD DAU DBH BW Total

USD 2,3 Bil USD 1,4 Bil USD 209 Mil USD 125 Mil USD 384 Mil USD 2,1 Bil

Bonds Issuance Interest Principal Other Fees Total DSCR Options (8 %)

1 USD 768 Mil USD 61,5 Mil USD 10,474 USD 6,983 USD 824 Mil 2,526

2 USD 558 Mil USD 44,7 Mil USD 10,474 USD 6,983 USD 603 Mil 3,474

3 USD 349,1 Mil USD 27,9 Mil USD 10,474 USD 6,983 USD 377 Mil 5,558

Municipal Bonds Issuance Stages

PLANNING PREPARATION ISSUANCE AND APPROVAL PRE - FILING FUNDS ALLOCATION

1. Regional Regulation 1. Governor’s Decision on the House of (RR) on Issuance of Municipal Bonds Issuance acceleration of Municipal Representatives Minister of Rating West Java’s Municipal and funds allocation Bonds Issuance Letter of Approval Municipal Bonds Timeline Finance Letter of Bonds 2. Governor’s Regulation on Nov 2019 Approval 2. RR on budgetary funds Municipal Bonds Issuance Des 2019 Overview procedures reserve for Municipal Bonds 2019 2020 2021 2022 2023

Muncipal Bonds Issuance Minister of Home Affairs West Java’s Book building and West Java’s Infrastructure Constructions + Operational Planning TOR Letter of Consideration Municipal Bonds Municipal Bonds effective 5 Nov 2019 Des 2019 Prospectus statement

West Java PPP Node Secretariat Bappeda Provinsi Jawa Barat Address: Jalan Ir. H. Juanda No. 287 Bandung 40135 Phone: 022-2516061 Fax: 022-2510731 Website: http://kpbu.jabarprov.go.id Email: [email protected]

THANK YOU APPENDIX TOTAL AREA CAPACITY ESTIMATED Ha INVESMENT COST 1.853 – 2.131 90 TONS/DAY IDR 3.5 – 4.4 TRILLION

Legok Nangka Waste to Energy (WTE) project is designed to use thermal technology that generates electricity. WTE is projected to overcome the waste problem of 6 cities by producing electricity that can be utilized as a power generator supply to PLN. The business enterprise is expected to assist investment, development and project management. The return on investment is obtained from the sale of electricity to PLN and the tipping fee that is withdrawn from the beneficiary city/district. CAPACITY 1.500 LITRE/SECOND

ESTIMATED INVESMENT COST

IDR 2.1 TRILLION

Jatigede regional water supply system is planned to serve the Greater Cirebon Area. The system is Water Treatment Plant designed with a capacity of 1500 lps which will flow through 5 municipalities. Business Enterprise assists the investment, construction and operation of the production and transmission system to the Pumping to 7 locations of Off-take reservoir Reservoir at 7 off-take locations. The business enterprise is expected to assist investment, development and project management. The return on investment is obtained from the sale of bulk water to PDAMs in 5 cities. CAPACITY 1000 TONS/DAY

TOTAL AREA

55Ha

ESTIMATED INVESMENT COST

IDR 500 The Ciayumajakuning Waste to Energy Project is designed to cover Greater Cirebon area. This project will BILLION managed solid waste generate from 5 municipalities. Around the services area, there are 10 new cities will be developed known as the Rebana Golden Triangle. Recognizing population growth, urban development and estimated waste production, WTE will be built under the PPP scheme. CAPACITY 26843 PASSANGERS/DAY

ESTIMATED INVESMENT COST

IDR 4.7 TRILLION

Metropolitan Bandung Urban Railway System Development is a project to provide alternative public transportation services in support of the Greater Bandung urban activities, this project has 7 lines and will be built in stages. Very large investment costs required and very limited of government funding ability, opens opportunities for private sector participation in building urban transport infrastructure TOTAL AREA

CAPACITY 7.3Ha Exsisting: 152 bed Upgrade to: 300 bed

ESTIMATED INVESMENT COST

IDR 350-400 BILLION

Pameungpeuk Hospital is the Class C hospital with a service capacity of 15,000 out patients per year and 5,000 in patients. To improve health services in the south West Java, the provincial government will develop Pameungpeuk Hospital to become Class B Hospital with increasing the number of human resources and improving health service facilities. CAPACITY Exsisting: 262 bed Upgrade to: 700 bed

ESTIMATED INVESMENT COST

IDR 450-600 BILLION

TOTAL AREA

Jampang Kulon Hospital is currently the only hospital in South Sukabumi, with services area covering and . At present the hospital's status is Class D type, and will be upgraded to the 3.59Ha Class C Hospital. Considering that this Hospital planned to be a referral center with the largest and most comprehensive health facilities in the Sukabumi Regency and Southern Cianjur. CAPACITY ESTIMATED TOTAL AREA INVESMENT COST Exsisting:350 bed Plan: 1000 bed IDR 400-600 3.59Ha BILLION

Al-Ihsan Hospital currently a Class-B Hospital owned by West Java Province. The number of patients handled by Al Ihsan Hospital reaches 800 - 1000 patients per day. To develop Al-Ihsan into a Class-A Hospital with more complete facilities, the Provincial Government invites partners from private / business entities that are experienced in Hospital management, to increased health services. ESTIMATED INVESMENT COST

IDR 400-500 BILLION CAPACITY Exsisting:112 bed Plan: 400 bed

TOTAL AREA

Sidawangi Pulmonary Hospital, is currently a Class B specialty lung disease hospital. Located on the border between Kab. Cirebon and Kuningan. Initially it functioned as a sanatorium for tuberculosis which was built by 10Ha the Government of the Netherlands East Indies in 1939. In 1978, it was changed to Hospital status and in 2002 it was handed over to West Java Province. In 2008 the status officially became Lung Hospital in West Java Province. As an effort to develop, this Paru Sidawangi Hospital plans to improve its facilities and services to become Class A General Hospital. CAPACITY 15-20 MW

ESTIMATED INVESMENT COST

IDR 400 BILLION