PT Sarana Multi Infrastruktur (SMI), an infrastructure financing company owned by the government, will help raise funds from pension funds, as well as insurance and social security funds.
According to the Finance Minister Bambang Brodjonegoro, who spoke about this on the sideline of an event, SMI could raise funds close to Rp40 trillion from the local financial institution firms.
Government is targeting a financing of infrastructure projects of Rp313 trillion ($23.72 billion) in the 2016 State Budget
“SMI as a facilitator can do debt financing and equity financing using those funds directly for the project,” he said.
SMI has already helped with financing of the Trans Sumatera Toll Road Projects, Umbulan Water Treatment, Riau Tenayan Power Plant Project, Cikopo – Palimanan Toll Road Project, and state owned airport operator PT Angkasa Pura II projects.
The company is set to become the future Indonesia Development Bank (LPPI) starting 2017 after it gets approval from House of representative, to merge with the other state firm Perusahaan Investasi Pemerintah (PIP) in January.
Beside collecting funds from local financial institution, Finance Ministry joined with Financial Services Agency (OJK) and Bank Indonesia (BI) set up Forum Coordinating of Financing Development through Financial Markets (FK-PPK).
According to BI’s governor Agus Martowardojo, through the forum coordination, the three parties could create market deepening and add more liquidity to the financial market.
“We encourage investment managers to use infrastructure projects as underlying asset for limited mutual funds as an instrument for raising funds on the infrastructure projects,said Chairman of OJK Muliaman Hadad
Indonesia needs investment with worth Rp 5,519 trillion until 2019 to develop infrastructure projects by government and private company.