AIIB to disburse US$248 million funding for Mandalika SEZ project
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily: AIIB Danai Proyek KEK Mandalika US$ 248 Juta
12 October 2018
By Eva Fitriani
Jakarta — PT Pengembangan Pariwisata Indonesia or Indonesia Tourism Development Corporation (ITDC), a state enterprise developing and managing tourism destination The Nusa Dua in Bali and Mandalika Tourism Special Economic Zone (SEZ) in Lombok, received funding from Asian Infrastructure Investment Bank (AIIB) of US$248.4 million or equivalent to Rp3.6 trillion. The fund will be allocated to finance tourism infrastructure development project in The Mandalika.
“ITDC is chosen as the first tourism development institution in the world to receive funding from AIIB. This shows trust in ITDC and the prospect of The Mandalika and global community’s trust in Indonesia’s economic potential, especially in the tourism sector,” said ITDC President Director Abdulbar M. Mansoer in his official statement, Thursday (11/10).
Barry said the two parties have inked the letter of intent (LoI), indicating AIIB seriousness to support ITDC in financing the project. The preparation process has been going on for the past nine months, and it secured approval from AIIB’s Investment Committee in early October 2018.
Stated in the LoI which is signed today, explained Barry, AIIB is ready to support the financing through Mandalika Urban & Tourism Infrastructure Program (MUTIP) worth a total US$248.4 million or equivalent to Rp3.6 trillion. This is the first standalone financing made by AIIB in Indonesia, and this is also the first AIIB financing for tourism infrastructure development in the world.
Through the MUTIP program, he said, the financing for tourism basic infrastructure development in The Mandalika and its surrounding will be made. AIIB will also partner up with ITDC to supervise the development of The Mandalika, ensuring that it will run according to the plan to become a tourism destination with international standard.
He added that the development of The Mandalika into a tourism destination will bring significant socio-economic impact and contribute to improving the local community’s wellbeing. “With the support of all stakeholders and the endeavours we have made, we are optimistic that the construction of Mandalika Tourism SEZ can be soon realised, so the target of 20 million foreign tourist visits set by the government can be achieved,” he said.
North Bali
On the same occasion, said Barry, two head of agreements (HoA) regarding development of tourism destination in North Bali, were also signed by ITDC, Menjangan Group, and PT Wijaya Karya (WIKA), and by ITDC, Menjangan Group, and PT Amorsk Indonesia. Amorsk is an exclusive developer of hotels, resorts, and residences under Paramount Hotels and Resort Branding and Management.
“HoA with Menjangan Group and Wika agrees on synergy between ITDC and Wika in developing a land of 100 hectares (ha) which is owned by Menjangan Group and located close to Menjangan Island, North Bali,” he explained.
Previously, Vinci Group, one of the largest companies in France, has decided to invest US$1 billion or equivalent to Rp14.5 trillion of fund in Mandalika SEZ. The fund will be utilised to build integrated entertainment & sport district in The Mandalika, including Mandalika street race circuit.
“The investment will be made in stages for 15 years. For the first stage, we will build 4 hotels and street race circuit,” said Vinci Construction Grands Projets (VCGP) Director, Michel Oliveres.
