Private Involvement in Sustainable Management of Indonesian Port: Need and Strategy with PPP Scheme

The gap between rural/fringe area and urban, performance services of sea transportation (including inland waterways and ferry transport), and financial limitations are facing the port development project in Indonesia. The management (in this case: purely the goverment) should conceive the sustainable management of port facilities. Partnership management could advancing the aspects of port circumstances by involving of private sector with public private partnership (PPP) scheme. This paper focuses on suggestion of PPP project practices for port development such as: identifying policy related to port sector of PPP arrangement, PPP framework on port sector, parties involved in PPP implementation project, and also the financing process of PPP project implementation in Indonesia. Other related issues on PPP project port sector are advantage and disadvantage of PPP arrangement project in Indonesia, risks associated to the project sponsor during implementation of PPP project especially in port sector, concessionaire selection methods to get best concessionaire, and critical success factor of PPP project.