Korean outfit inks fourth-stage development contract
The Korea National Railway (KNR) announced on May 31 that the South Korean outfit had inked a memorandum of understanding (MOU) with PT MRT Jakarta.
Under the agreement, the KNR-headed consortium would work on the Jakarta mass rapid transit (MRT) system in the capital city of Indonesia.
The Korean consortium is composed of the Korea Overseas Infrastructure & Urban Development and Samsung Construction & Trading.
The consortium would cooperate to take part in the fourth-stage development projects of the Jakarta MRT on its planning, construction, operation, and funding.
Jakarta houses around 10 million residents, and it is estimated that more than 4 million inhabitants of the surrounding Greater Jakarta area commute to and from the city every day.
Thus far, Jakarta has lacked public transportation infrastructure. Hence, the city strives to improve the transportation system through the Jakarta MRT scheme.
The fourth-stage development is valued at around 1.5 trillion won ($1.2 billion).
“Recently, Southeast Asian countries, including Indonesia, have paid big attention to railway projects based on PPP,” KNR leader Kim Han-young said.
“Through this agreement, we hope our companies would be able to secure more opportunities to win contracts in Jakarta and the nearby regions.”
Short for public-private partnership, PPP refers to an arrangement between two or more public and private sectors of a long-term nature.
Typically, the system involves private capital financing government projects and services upfront and drawing profits from taxpayers or users over the course of the private-public deal.
The KNR is a railroad construction and management entity. The subsidiary of the Ministry of Land, Infrastructure and Transport oversees the construction of railways in Korea.