Trans-Java Toll Road: Knitting Barrier-Free Connectivity
The presence of toll roads, especially JTTS, should be part of the solution to overcome the high cost of logistics. Therefore, an institutional framework is needed to support the efficiency of toll road management.
The landscape of the Gempol-Pandaan toll road at the Gempol interchange around KM 775, Pasuruan, East Java, with Mount Penanggungan in the background, Wednesday (15/4/2021).
Several centuries ago, in 1808 to be exact, Herman Willem Daendels, the governor-general of the Dutch East Indies, built a land connectivity infrastructure linking the western with the eastern tip of Java Island as part of the efforts to improve trade (commodity transportation), as well as the military mobility.
This land connectivity infrastructure was known as Jalan Raya Pos [Great Post Road] spanning from Anyer in Banten to Panarukan in East Java.
The road encompassed the Anyer-Batavia-Panarukan and Batavia-Buitenzorg (Bogor)-Cisarua-Cianjur-Rajamandala-Bandung-Parakanmuncang-Sumedang-Karangsembung routes.
An insurgence in Cirebon and the British blockade of Jakarta Bay at that time forced the route from Buitenzorg to the Cirebon export port to rotate in such a way, not directly from Buitenzorg via Batavia to Cirebon.
The colonial-era mega project was completed in just one year. This highway connected the centers of several important commodities, such as coffee, tea and rice.
The existence of the highway was used to expedite the cultuur stelsel, a colonial cultivation system in the mid-19th century that required farmers in Java to devote a portion of agricultural production to export crops. It was referred to as tanam paksa (forced planting).
Most of the Jalan Raya Pos sections have now been transformed into what is today called Pantura in the north coast of Java, which used to be heavily congested and jammed, especially in the buildup to Idul Fitri, before the construction of the trans-Java toll road (JTTJ)
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A media publication in its 22 Aug, 2012, edition, carried a main story with a heading saying that Pantura was badly congested, alternative routes and toll roads urgently needed to be built.
From the perspective of Path Dependency theory, the construction of the trans-Java toll road could not be separated from the already set path of the northern coast corridor (Pantura), given that the future development of an economic system is affected by the path it has traced out in the past.
The heavy traffic on the Pantura highway raised the urgency to establish barrier-free connectivity from the western tip to the eastern tip of Java Island to increase and expedite the flow of goods and vehicles, improve logistics efficiency and stimulate regional growth.
“Knitting connectivity” may be the appropriate term to reflect a potentially long cumbersome building process.
In the era of democratization or reformation, building toll roads is not easy, especially when it comes to the stage of land acquisition, which takes a relatively long time, possibly years from the initial announcement of the project.
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The Semarang-Solo toll road in Banyumanik District, Semarang City, Central Java, Friday (16/7/2021).
Therefore, building a toll road that sees the west and east end of Java Island completely connected is a work of “knitting connectivity”.
One example of cumbersome progress in the JTTJ is the construction of the Probolinggo-Banyuwangi segment, which was initially planned to operate in 2019.
However, the planned 171.5 kilometer toll road comprising three sections has faced early problems with the land acquisition for section I (the 29.6 km Probolinggo-Besuki section), only reaching 24.88 percent as of July.
Development of the barrier-free connection was carried out by connecting the previously built toll roads, between 1983-1996, namely the Cilegon, Jakarta, Bogor and Cirebon sections, followed by Brebes, Semarang, Solo, Ngawi to Surabaya. The final section of the trans-Java toll road, which spans from Probolinggo to Banyuwangi, is expected to begin construction next year.
The toll road to connect Jakarta with Surabaya, which are the two largest cities in Indonesia, officially commenced in 2018, while the completion of toll road connectivity between the west end of Java Island in Cilegon and the east end in Banyuwangi is estimated to be realized by 2024.
Until 2021, the total operational length of JTTJ has reached 1,167 km, while operational toll roads throughout Indonesia cover 2,391 km.
With a total operational length of 1,167 km relative to the area of Java, the density of toll roads in Java reaches 0.91 km per 100 square km (km2).
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The current Java toll road density is fairly good, although it is still below Singapore, China and Japan. However, Indonesia’s toll road density as a whole is only 0.12 km per 100 km2.
This is because the trans-Sumatra toll road has yet to be completed, and the length of toll roads on the islands of Kalimantan and Sulawesi is still short. In Papua, there are no toll roads.
The low percentage of built toll roads in Indonesia is also partly due to the fact that many islands, including uninhabited ones, do not allow the construction of toll roads, while the area is calculated as the denominator of the length of the toll road per 100 km2.
The total planned length of JTTJ is targeted at 5,103 km until 2024. If the target is achieved, the toll road density per 100 km2 will improve to 0.27 km.
In recent years, the government has massively built or continued the construction of connectivity infrastructure projects, including for sea and air transportation, even amid the pandemic.
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Rest area on the Transjawa toll road segment Semarang-Solo Km 456 in Semarang Regency, Central Java, Tuesday (14/12/2021).
Some of them are mega-scale projects, especially those of new construction (greenfield projects) — not only toll roads but also new international airports and new major ports.
The connectivity infrastructure mega projects are generally realized under direct cost recovery through cooperation with domestic and foreign investor partners.
Public-private partnership (PPP), government-business cooperation (GBC) and build-operate-transfer (BOT) schemes have helped ease the burden on the state budget due to the pandemic.
JTTJ is seen by investors as a lucrative and attractive projects for investment, be they domestic or foreign investors. However, foreign investors tend to approach “safe investments”, namely through divestment transactions on sections that are already operational.
They are disinclined to invest when the planned toll road’s construction has just reached the stage of land acquisition. Some of the foreign investors are Road King Infrastructure, a Hong Kong company, which through its subsidiary PT Kings Key Limited acquired 40 percent of PT Waskita Toll Road's shares in the Surakarta-Ngawi and Ngawi-Kertosono sections through the entity PT Jasa Marga.
Metro Pacific Tollways Corps, through the entity Marga Mandala Sakti, is involved in the Tangerang-Merak section project (15.69 percent), while the Canada Pension Fund has moved to acquire 55 percent of the shares in the Cikopo-Palimanan section through the entity PT Lintas Marga Sedaya.
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The high interest in JTTJ projects is not only because of the traffic volume that investors see as prospects of economies feasibility, but also the long flexible concession period — 35-year concession period potentially to be extended to 50 years or more — as well as the prospective provision of toll tariffs.
In general, the toll road business in 2021 is approaching the pre-pandemic situation of 2019. The indication is that the average daily traffic (LHR) on the state-owned PT Jasa Marga-operated toll roads reached around 81.25 million vehicles as of April, compared to 104.8 million vehicles for the whole 2019.
From the perspective of market economy theory, toll road investment is a pure monopoly business. Because there are no competitor operators, toll road users have no alternative toll roads with lower fares to choose from.
However, from the perspective of the transaction cost theory, the existence of JTTJ can eliminate information asymmetry and uncertainty. This is because there are many possible obstacles on Pantura, which brings implications on the length of travel time, increased risk and additional costs, including fuel consumption and accommodation.
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Batang Integrated Industrial Estate (KITB) in Gringsing District, Batang, Central Java, Friday (17/12/2021). This industrial area has direct access to the Transjawa toll road, the Batang-Semarang toll road.
Vital access
On the one hand, JTTJ is an attractive investment area for investors, but on the other, the existence of JTT is vital for the growth of the traversed area.
In agglomeration areas, toll road connectivity can reduce travel time, stimulate economic growth and encourage regional development.
It can be seen from the case of JORR 1 and JORR 2, which has helped develop the Greater Jakarta megapolitan. The presence of JORR 2 has reduced or eliminated congestion on the already operated JORR 1.
However, the role of the JTTJ sections of Greater Jakarta in the growth of the agglomeration area, may no longer be a new thing with traffic congestion persisting like a “vicious circle”.
Traffic congestion and the increasing number of vehicles are the reasons for building new toll roads. However, the construction of new toll roads has also triggered an increase in the number of new vehicles, and so on.
Toll road connectivity complements the integration between urban transportation modes, such as in the case of Adisumarmo International Airport, which, apart from being accessed by an airport train from Balapan rail station and city bus from Tirtonadi terminal, can now be reached via the Surakarta-Ngawi toll road.
There is also a skybridge connecting the rail station and the Tirtonadi bus terminal, which makes it easier for passengers to change modes of transportation.
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JTTJ connectivity is very important to support the existence of infrastructure operations, especially those built completely new, such as Patimban Port, West Java International Airport (BIJB) and Yogyakarta International Airport.
The under-construction toll road will connect Patimban Port with industrial areas around East Bekasi, Karawang, Indramayu, Subang and Purwakarta.
The existence of Patimban Port together with toll access will allow logistics efficiency by reducing travel time, especially because it can avoid traffic congestion.
The knitted connectivity of JTTJ encompassing Central Java and East Java regions enables industrial mobility and growing investment between regions.
In recent years, there has been a relocation of a number of industries from West Java to Central Java, due to lower labor wages or regional minimum wage (UMR).
The development of the Batang Integrated Industrial Estate (KITB) has been made possible because of transportation access provided by JTTJ. A logistics railway line has been planned to link the dryport in KITB to the Tanjung Emas seaport, Semarang. KITB is also prepared to accommodate industrial relocation from abroad.
The existence of JTTJ also provides opportunities for micro, small and medium enterprises (MSMEs), especially those operation in toll rest areas, to thrive. These MSME business opportunities range from restaurants, coffee shops and souvenir vendors to minimarkets and gas stations.
MSME business opportunities are also open in areas around toll exits, such as gift shops and restaurants. The property sector is also set to develop due to toll road access, as seen in every area around toll exits of the newly operated toll roads.
Efficiency
In economic theory, it is known as Pareto Optimum, which is identical to Nash Equilibrium in Game Theory. JTTJ is indeed becoming a lucrative investment, especially when the economy has recovered from the pandemic.
However, there needs to be a balance between investors' profits and the benefits to the community, including logistics efficiency.
The presence of toll roads, especially JTTJ, should be part of the solution to overcome the high cost of logistics. Therefore, an institutional framework is needed to support the efficiency of toll road management, especially related to tariffs, concessions, facilitation and land acquisition.
Wihana Kirana Jaya
The barrier-free connectivity of JTTJ, especially in the area around toll exits/entrances, also needs to be integrated with the connectivity of the national road network, provincial roads, district roads and village roads to facilitate the distribution and marketing of signature products in rural areas.
Wihana Kirana Jaya, Professor at Economy and Business School (FEB), Gadjah Mada University
This article was translated by Musthofid.
