Jakarta in a jam: The urban transport issue is proving to be one big headache in Indonesia’s capital for the politicians to solve

Updated: Tuesday November 26, 2013 MYT 7:34:50 AM

Jakarta in a jam


The urban transport issue is proving to be one big headache in Indonesia’s capital for the politicians to solve.

KUALA Lumpur is not the only city struggling with traffic congestion. On most weekdays, the Indonesian capital, Jakarta, is basically a barely moving parking lot. The city’s notorious macet is estimated to cause annual losses in excess of US$3bil (RM9.6bil). This figure will spiral even further as President Susilo Bambang Yudhoyono’s administration launches its Low Cost Green Car policies — policies that don’t appear to have been paired with any mass transport initiatives.Moreover, with the rainy season fast approaching, commuting in the “Big Mango” will only get worse.

Nonetheless, given that there are well over 26 million people within the Greater Jabodetabek region (essentially Jakarta and all of its suburbs), managing public and private transport has become a gargantuan task.

Imagine having to move the 14 million commuters who pass through Jakarta every day (that’s a larger number than the city’s 9.8 million population)?

Furthermore, the limited coordination between Susilo’s administration, the local government authorities as well as the different transportation services has compounded the challenges.

Of course, the wildly popular Jakarta Governor Joko Widodo (also known as “Jokowi”) has promised improvements.

But can he deliver? Can the monorail, slated to open in late 2017 and the MRT lines in 2018, really make a difference?

Won’t the annual increase in cars and motorbikes (estimated at over 11.26% per annum) have already overwhelmed Jakarta’s limited road capacity by then?

Of course, Jokowi isn’t totally responsible for the mess. Years of underinvestment and neglect have brought Jakarta to a near-standstill.

But having inherited the problem, he needs to solve it, especially if he has ambitions for higher office.

There are concerns even about his proposed solutions to the gridlock. Jakartans fear that the construction of both the monorail and MRT projects will only make traffic worse in the short-term.

Doesn’t that sound very familiar?

Indeed, some people wonder if Indonesia’s cities really need mass transit projects.

Will the MRTs and monorail become costly white elephants? Will Jakarta end up having to subsidise the commuters on such a scale?

Still, cost issues aside, no one can deny that both mass transit projects will help alleviate Jakarta’s traffic — if and when they are completed later this decade.

The monorail alone, for instance, is expected to be able to transport between 40,000 to 80,000 passengers per hour.

What are the Governor’s more immediate short-term solutions, then? The Jakartans can’t just wait until 2017, ya?

Well, Jokowi is also promising a massive increase in the number of TransJakarta buses in the next 12 months.

Using dedicated, traffic-free busway lanes that are modelled after the ground-breaking service in the Brazilian city of Curitiba, this low-cost service has been starved of investment.

Jokowi has stated that there will be 400 new long-wheel base buses in December with another 1,000 to come by the end of 2014.

Hopefully, this will ease the delays experienced by commuters on the less-well travelled Busway lines of Kampung Rambutan-Kampung Melayu and Ragunan-Latuharhari.

It is hoped that a big improvement in the TransJakarta bus services would encourage commuters to leave their cars at home and subsequently ease the implementation of an Electronic Road Pricing (ERP) system in the heart of the city — perhaps along the Thamrin/Sudirman and Rasuna Said/Kuningan cordons.

The train services in and around Jakarta are another transportation system that needs to be given attention. Could the frequency and quality of service on key routes such as Depok, Bogor and Tangerang and BSD be improved?

And what about the much-discussed rail-link from Dukuh Atas (close to the prestigious Hotel Indonesia roundabout) to the Soekarno-Hatta Airport?

So, while it is true that Jakarta needs a better transportation system, people also need to realise that this isn’t a magical, overnight process.

Such policies must take into account the short-term solutions, easing immediate needs while waiting for the long-term facilities to be completed.

Furthermore, Jakarta residents are going to have to make more sacrifices in terms of time wasted before they see any improvements.

So, what are the lessons that could be drawn from Jakarta, the living, breathing heart of Indonesia?

Firstly, political will is a must in dealing with this kind of problem.

Secondly (related to the first point above), delaying action only serves to exacerbate the challenges. Bold and decisive steps must be taken.

Thirdly, an effective and comprehensive public transportation system requires coordination between all level of governments as well as the different transportation services.

So, the next time you’re stuck in an interminable jam along Jalan Duta or Jalan Loke Yew, rest assured that your predicament isn’t half as bad as commuters in Jakarta.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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