Governance of Transport Corridors in OIC Member States:
Challenges, Cases and Policy Lessons
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facilitate national and regional integration, enhance productivity, increase trade, reduce the high
national logistics costs (which count for 24 per cent of the GDP) and be conducive to economic
development.
It is interesting to note that Indonesia considers the development of national maritime connectivity as
having multiple policy objectives. It started in 2014 as a revival of the historic maritime identity of the
country, which did not play a substantial role in Indonesia’s history of the 20 th century. Policy
objectives include regional safety and security on sea and reducing illegal human trafficking; reducing
illegal fishing in Indonesian territorial waters; and addressing climate change and the rise of sea level
due to global warming. In 2015, the concept of the maritime fulcrum was enlarged to include also the
objective of narrowing the gap between different levels of socio-economic development between the
islands. In November 2015, the concept of Sea Toll Roads was relaunched to enhance inter-island
connectivity and strengthen the port infrastructure of Indonesia. This concept was introduced earlier
in the form of establishing a Pendulum Nusantara (Archipelagic Pendulum) to connect five ports in
Indonesia by a regular shipping line: Belawan in North Sumatra, Tanjung Priok in Jakarta in west Java,
Tanjung Perak in Surabaya in East Java, Makassar in South Sulawesi, and Sorong in Papua. The new
concept of Sea Toll Roads includes these five ports, as well as Pontianak in West Kalimantan and
several smaller ports spread all over the country hows Indonesia’s Sea Toll Road Network.
The costs of the implementation of the Sea Toll Roads project are estimated by Bappenas, the Ministry
of Planning of Indonesia, at US$ 53 billion. The project includes the construction of 24 commercial
seaports, 1,481 non-commercial seaports, 15 industrial centres, and purchase of new vessels. These
costs cannot be covered from the national budget of the Government of Indonesia. Therefore,
Indonesia is trying to attract investments from the national and international private sector and has
therefore a strong drive to improve the investment climate in the country. It also explains why the
Indonesian Government is very active in its efforts to search for complementarities between the Sea
Toll Road Project and regional connectivity initiatives such as ASEAN and the Chinese One Belt One
Road (OBOR) initiative.