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Indonesia uses Chinese loan to kick start major road projects

The Indonesian government is looking to spend around US$385 million of a major loan from China to construct three toll roads in the islands of Kalimantan, Sulawesi and Java. The three toll roads are Cileunyi-Sumedang-Dawuan (Cisumdawu) of West Java, Balikpapan-Samarinda of East Kalimantan and Manado-Bitung of North Sulawesi. China recently announced it would lend Indonesia around $1.5 billion for infrastructure projects.
August 26, 2015 Read time: 2 mins
The Indonesian government is looking to spend around US$385 million of a major loan from China to construct three toll roads in the islands of Kalimantan, Sulawesi and Java.

The three toll roads are Cileunyi-Sumedang-Dawuan (Cisumdawu) of West Java, Balikpapan-Samarinda of East Kalimantan and Manado-Bitung of North Sulawesi.

China recently announced it would lend Indonesia around $1.5 billion for infrastructure projects.

A report by the Jakarta Globe newspaper noted that the Ministry of Public Works said the government tendered the three projects in July and is still working to clear the required land.

The process of acquiring land for the 10.2km Cisumdawu toll road is expected to be complete by the end of the year. The cost of the project will stand at $235 million and be funded by the Chinese loan.

Around $65 million of the Chinese loan will go to the 20km Balikpapan-Samarinda toll road, while $85 million will go to the 34km Manado-Bitung toll road to fund the development of a 7km section.

After Japan, China is Indonesia's second largest infrastructure funder. The loan from China is line with the government's plan to borrow $23.2 billion from foreign entities in the coming four years to construct toll roads, bridges, highways, drinking water networks, reservoir, housing projects and irrigation.

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