Indonesia’s maritime identity is undeniable, but Supply Chain Indonesia (SCI) CEO Setijadi believes amplifying land connectivity through strategic toll road development is crucial for national progress. This focus on hinterland transport holds immense potential to unleash economic growth and elevate Indonesia’s global standing.
Setijadi, underscored the pivotal role of toll road construction in amplifying connectivity for both passengers and cargo. Bolstering its land connectivity or hinterland remains imperative. This necessitates extensive development, encompassing the augmentation of toll roads and railway systems.
The strategic investment in toll roads is paramount, given that hinterland transport expenses significantly shape the overall transportation costs. Research from Pelni and INSA reveals that port-related expenses constitute around 31%, sea transport is about 19%, and hinterland transport escalates to nearly 50% of the total costs.
Moreover, the progression of toll roads stands as a cornerstone for the growth of the transportation sector, which is a linchpin in Indonesia’s Gross Domestic Product (GDP) dynamics.
TW = Quarter
For context, in 2022, the transportation segment infused Rp774.99 trillion, equivalent to 3.96% of the GDP. This marked a robust growth rate of approximately 15.83%, outpacing Indonesia’s general economic growth of 5.31%.
Looking ahead, SCI projects a continued ascent for the transportation sector, with anticipated growth rates of 18.39% in 2023 and 19.35% in 2024.
On another front, the Ministry of National Development Planning (PPN/Bappenas) highlighted that national logistics constitute 14.1% of commodity prices, with export logistics trailing at 8.98%. Clearly, logistics costs wield a profound influence over commodity valuations.
Setijadi pointed out that transportation costs significantly dictate Indonesia’s logistics expenditure, approximated at a staggering 70%. The enhancement of toll roads promises to elevate the efficacy of these logistical operations.
In summary, the ripple effects of toll road expansion will recalibrate commodity prices, subsequently shaping the purchasing capacity and socio-economic welfare of the population. Additionally, this infrastructure development will amplify the competitive edge of Indonesia’s national products and commodities.
