Jakarta’s Traffic Problems Expected To Worsen in 2014

The infrastructure and gridlock problems facing the city of Jakarta, Indonesia are expected to worsen this year. The Indonesian government expects 1.2 million new cars will be purchased in the country in 2014.  This fact, coupled with the Indonesian central government’s unwillingness to invest in new infrastructure projects, could result in “total gridlock” according to the executive director of the Indonesia Effort for Environment. 

Jakarta is the capital city of Indonesia and its population of almost 10.2 million people make it the thirteenth largest city in the world.  The city serves as the economic, political, and cultural center of Indonesia.  Multiple factors have lead to the country’s infrastructure worsening over the last 20 years.  First, the Indonesian government is currently spending less than five percent of its GDP on infrastructure.  This is a low figure to begin with, but it is also a significant drop from 1995 when the country spent 9.2 percent of the GDP on improving Indonesia’s roads and transportation systems. Another reason for Indonesia’s lack of new infrastructure projects is the fact that, according to the 2013 IMF Working Paper, the country ranks second to last in Asia in “ease of doing business” rankings and last in infrastructure quality.  The paper states that, “Efficient execution of infrastructure projects is constrained by limitations in project selection at local government levels.”  It also states that weaknesses in the procurement, budget preparation, and payment processes have led to low infrastructure investment.  The final major cause of the country’s problems is the central government’s belief that infrastructure responsibility should fall on the local governments.  Local governments can only prepare their budgets on a yearly basis so this leads to contract renegotiations annually.  This system makes it very difficult to implement the large-scale, multi-year projects necessary to fix the city’s gridlock.

Indonesia will elect a new president in July.  There is not much hope that current President Susilo Bambang Yudhoyono will create any solutions to mitigate the city’s traffic problems in the next six months. However, the governor of Jakarta revived a railway system project in 2013, and he is hoping to introduce high-speed rail to the region.  The Governor’s efforts to improve Jakarta are being stymied by the President’s fuel subsidies and tax incentives to buy new cars.  While the central and local governments battle over who should be responsible for funding infrastructure development, the residents of Jakarta will continue to face five kilometer commutes that take an hour to complete each day.

Sources: The Diplomat, IMF