The development of the Mandalika Special Economic Zone (SEZ) is expected to accelerate development of Indonesian tourism and economy
By
kompas team
·5 minutes read
Mandalika is one of the government’s five priority tourist destinations. Designated a special economic zone in 2014, Mandalika offers marine tourism with a charming beach and underwater environment.
Mandalika is currently in the spotlight. A racing circuit is now under construction there for the most prestigious international motorcycle race, the MotoGP. The Mandalika Circuit has a length of 4.31 kilometers. The president director of PT Pembangunan Wisata Indonesia (ITDC), Abdulbar M. Mansoer, said last week that construction had been completed for the main track, which has 17 turns.
In addition to the pavement of the main track, construction has been completed for a concrete barrier and tunnel. Other supporting facilities, such as the race control building and the pit building, are currently being completed. Similarly, construction is also underway on a health center equipped with a helicopter pad.
According to Abdulbar, MotoGP organizer Dorna Sports expressed appreciation for development of the Mandalika Circuit, which had increased the ITDC\'s confidence in ending Indonesia\'s 26-year-long wait to host the world-class motorcycle race.
Although construction on the circuit is on schedule for completion this year, Dorna Sports has decided to postpone the MotoGP from its original schedule this year to March 2022 because the Covid-19 pandemic is not yet under control.
However, the Mandalika Circuit will be used for another motorcycle race this year, the 12th World Superbike (WSBK) on 12-14 Nov. 2021. The Mandalika Circuit will also host the MotoGP preseason test in February 2022.
The development of the Mandalika Special Economic Zone (SEZ) is expected to accelerate development of Indonesian tourism and economy. According to the SEZ National Council’s 2020 annual report, a total of nine investment projects are located in Mandalika, mostly hotel and commercial area development projects.
Industrial activities
A special economic zone is also under development in Gresik, East Java. Unlike the tourism-based Mandalika SEZ, the Java Integrated Industrial Port and Estate (JIIPE) SEZ in Gresik focuses on nickel and steel smelters, as well as electronics, petrochemical and energy plants.
From Kompas\' observations on Friday (3/9/2021), tons of raw materials for fertilizer production were unloaded from a ship at the Gresik SEZ port. Construction of a road connecting the port to PT Freeport Indonesia’s copper smelting plant was also underway. Freeport is one of the SEZ’s tenants.
A number of dump trucks transported soil along the roads crisscrossing the JIIPE, while a number of other trucks were also seen transporting products and raw materials belonging to tenants of the SEZ.
The JIPPE SEZ occupies an area of 3,000 hectares that consists of a 1,761 ha industrial area and a 400 ha port area, as well as supporting facilities such as an 800 ha residential and commercial area.
"Three areas are integrated," said Iskandar J.K. Rares, general manager of Domestic & International Markets and Marketing & Business Development at PT Berkah Kawasan Manyar Sejahtera.
In the port area, the length of the JIIPE wharf is to total 6.4 km at full operation. Of this, a 1 km long and 50-meter wide section is already operational as a general port for dry, liquid, and general cargo.
The port, which has a depth of 16 m below sea level at high tide, can serve vessels of 100,000 deadweight tonnage (DWT).
Iskandar said that companies considered a number of factors before entering an economic zone, such as connectivity and transportation, utilities and supporting facilities, and ease of doing business. He claimed that the JIIPE provided all these factors.
Meanwhile, the Kendal SEZ in East Java is for the manufacturing industry. Sales & Marketing head Juliani Kusumaningrum of PT Kendal Industrial Estate explained that the Kendal SEZ had a very strategic location, as it was on the North Coast Highway (Pantura) and could also be reached from western and eastern parts of Java by toll road.
Total investment in the Kendal SEZ was expected to reach Rp 72 trillion by the end of 2025, with annual export earnings of Rp 7 trillion.
“So far, it has been on track. Investment realization has so far reached Rp 21.5 trillion, a 14 percent increase from 2020," said Juliani.
The Kendal SEZ also has a furniture and wood processing polytechnic to meet the human resource demand in that field.
The Kendal SEZ occupies an area of 1,000 ha. The zone’s industry sectors mostly comprise the food, furniture and game center equipment, fashion, automotive, and electronics sectors. The Kendal SEZ also has a furniture and wood processing polytechnic to meet the human resource demand in that field.
In Riau Islands province is located the Galang Batang SEZ, which exports 80,000 tons of aluminum oxide (alumina) per month.
The primary tenant of the Galang Batang SEZ is PT Bintan Alumina Indonesia (BAI), which operates a smelter-grade alumina refinery. Its bauxite processing plant is expected to export 2 million tons of alumina per year, starting in 2027.
The 2,333 ha Galang Batang SEZ is expected to secure investments totaling Rp 36.25 trillion and provide 20,000 jobs by 2028.
PT BAI was currently operating a smelter with an annual production capacity of 1 million tons of alumina.
PT BAI president director Santoni said the first phase of construction, which began in 2016, was completed last year. PT BAI was currently operating a smelter with an annual production capacity of 1 million tons of alumina.
It is hoped that the SEZs will boost production and exports. A number of countries, such as Malaysia, are also developing SEZs to boost exports and industrial production, and tourism SEZs aim to lure international tourists.
The Covid-19 pandemic has brought a variety of economic challenges, but construction on a number of SEZs is on track, despite the difficulties. (DIT/WER/ZAK/NDU)
(The article was translated byHendarsyah Tarmizi).