The Rempang Project and Infrastructure Accountability Risk

The embers of resistance that have not been extinguished on Rempang Island near Singapore portray the imposition of the Jokowism paradigm in infrastructure development.

As if following its predecessor project, land issues for the development of the Rempang Eco-City Area have similar symptoms, starting from the absence of democratic practices, zero meaningful public participation and paying no heed to the principles of good governance.

Poor governance in this National Strategic Project (PSN) is also a silent witness to the continued emergence of agrarian conflict, employment issues and even ecological and natural resource damage. Widespread traces of damage and intensifying tensions can also be found in forced evictions in Wadas, Air Bangis and Lambo, the eruption of social problems in the Morowali Industrial Area in Central Sulawesi and nickel mining in Halmahera and the controversy over the construction of the Jakarta-Bandung high-speed railway and the Nusantara State Capital (IKN).

The consistency and recurrence of this problem is certainly not due to miscommunication. If this is true, how could clashes have occurred if not for the absence of consultation and participation processes?

The results of the Infrastructure Corruption Risk Assessment Tool (ICRAT) initiated by Transparency International Indonesia (2023) found the opposite: a number of the problems above were an excess of poor integrity due diligence in the planning and selection stages of the PSN project itself. The overlapping ambitions of the President to execute infrastructure development projects quickly are also exacerbated by the governance situation of planning and project selection, followed by a decline in information transparency such that supervision is not optimal.

The results of this collaborative research confirm that Jokowi’s “infrastructure first” regime has three fundamental problems, so it has failed to fulfil the principles of good governance in the infrastructure sector.

First, the regulatory framework is drawn up arbitrarily and inconsistently, leading to legal uncertainty. The regulatory framework on which the PSN project is based can change at any time, being determined on a whim without adequate consultation and legislative oversight.

For example, the development of the Rempang Eco-City Area, which is a joint project between the Indonesian Free Zone Authority (BP Batam) and a local company, PT Makmur Elok Graha (MEG), which is said to have collaborated with the Xinyi Group, has never existed before and is new. It was only recently included in the PSN list as stated in Coordinating Economic Affairs Ministerial Regulation No. 7/2023. The ease of dismantling the PSN list confirms structural problems in the legal environment aspect, accompanied by a minimal evaluation process.

A similar situation can be seen in the Jakarta-Bandung high-speed railway project, where Presidential Regulation No. 107/2015 clearly states that the project will not use the state budget and will not be guaranteed by the government in its implementation. However, recently, a government regulation was issued that allows the provision of government guarantees to obtain funding for cost overruns for the Jakarta-Bandung train project.

Second, there is a significant potential for undue influence due to decisions being taken prematurely, as well as submissions and elections having minimal independent review. The infrastructure sector is inherently shaped by political priorities, which often clash with principles of good governance. This situation is increasingly complex because the infrastructure sector has many unique characteristics, including the difficulty of comparing prices, the large number of actors involved, the long development period and the strong culture of secrecy.

Unfortunately, these risks and vulnerabilities do not appear to be seriously stemmed by the government, especially by the Committee for the Acceleration of Priority Infrastructure Provision (KPPIP). This institution tends to be political in filtering PSN proposals, weak in coordination in the project planning stage and neglectful in ensuring integrity due diligence takes place consistently and comprehensively. At the selection stage, it was clear that there was a disconnect between the needs analysis in the field and the feasibility assessment of the initial project design being offered.

Reviews from government contract panel teams also often prioritize political incentives rather than the impact on social and environmental scars. Meanwhile, the decision is often taken even before the outline business case (OBC) is available. A lack of transparency regarding funding estimates, AMDAL results and budget approval accompanies this problem. The selection and withdrawal of projects, including PSN, is practically only carried out by KPPIP without adequate independent review and minimal accountability.

Third, related to the previous points, the instruments of supervision and checks and balances do not operate optimally because of the breadth of government discretion. Public information such as annual reports, audit reports, procurement and budgeting data, work terms of reference and environmental impact analysis documents is often complex and difficult for the public to access. In that context, it is legitimate to say that the PSN project has not been able to fulfil the mandate of Law No. 14/2008 on public information openness.

Minimal community involvement is also visible in the escalating conflict in PSN development areas such as Rempang. Even the supervisory mandate, which the House of Representatives and regional legislative councils must carry out, appears to be blunted because the flow of project list submissions seems subject to centralization by the central government and is immune from the supervision process. The intertwining of political-business interests between the executive and legislative branches adds to the complexity of potential conflicts of interest within the PSN. In turn, without being accompanied by political seriousness to prioritize the integrity of the infrastructure project selection stage, big ambitions for developing infrastructure projects will only leave risks of inefficiency, mismanagement and even the possibility of corruption. This improvement agenda must start by stopping playing down the Rempang issue as a matter of miscommunication and admitting that this issue is a form of denial and violation of the constitution.

The subsequent response is that the entire list of PSNs running for the past year should be evaluated and strengthened with strict integrity due diligence.

This article was published in with the title “The Rempang project and infrastructure accountability risk” on October 5th, 2023. Click to read:

Leave a Reply

Your email address will not be published. Required fields are marked *