Document of The World Bank Kerja Presiden Bidang Pengawasan dan Pengendalian Pembangunan...

Document of The World Bank

Report No: ICR00003270

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IBRD-82090, IBRD-83050)

ON A

SERIES OF LOANS

IN THE AMOUNT OF US$ 400 MILLION

TO

THE REPUBLIC OF INDONESIA

FOR

CONNECTIVITY DEVELOPMENT POLICY LOANS

November 26, 2014

Trade & Competitiveness Global Practice Indonesia Country Unit East Asia and Pacific Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective September 25, 2014)

Currency Unit = Rupiah (IDR)

USD 1.00 = IDR 11,952.5

FISCAL YEAR January 1 – December 31

Vice President: Axel van Trotsenberg Country Director: Rodrigo Chaves Practice Manager: Mona Haddad/P.S. Srinivas

Task Team Leader: Sjamsu Rahardja ICR Team Leader: Alberto Portugal Perez

ICR Co-Author: Brasukra G. Sudjana

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ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities JTA Jabodetabek transportation authority

ADB Asian Development Bank Kadin Kamar Dagang dan Industri (Indonesian Chamber of Commerce and Industry)

ADEKSI Asosiasi DPRD Kota Seluruh Indonesia (City Council Association of Indonesia) Keppres Keputusan Presiden (Presidential Decree)

ADSL Asymmetric Digital Subscriber Line KKPPI Komite Kebijakan Percepatan Penyediaan Infrastruktur (Committee for the Acceleration of Infrastructure Provision)

AMAN Aliansi Masyarakat Adat Nusantara (Association of Indigenous Peoples of the Archipelago)

KOMNAS HAM Komisi Nasional Hak Asasi Manusia (National Committee on Human Rights)

AMDAL Analisa Mengenai Dampak Lingkungan (Environmental Impact Assessment) KPK Komisi Pemberantasan Korupsi (Corruption

Eradication Commission)

APPSI Asosiasi Pedagang Pasar Seluruh Indonesia (Association of Market Traders) LIBOR London Interbank Offered

ASEAN Association of Southeast Asian Nations LPI Logistics Performance Index Ausaid Australian Agency for International Development M&E Monitoring and Evaluation

Bappenas Badan Perencanaan Pembangunan Nasional (National Development Planning Agency) MDFTIC Multi Donor Facility for Trade and

Investment Climate BI Bank Indonesia MDGs Millennium Development Goals

BOS Bantuan Operasional Sekolah (School Operational Assistance) MDRI Multilateral Debt Relief Initiative

BPJT

Badan Pengatur Jalan Tol (Indonesia Toll Road Authority)

MIC Middle-Income Country

BPK Badan Pemeriksa Keuangan (State Audit Agency) MIS Management Information System

BPN Badan Pertanahan Nasional (National Land Agency) MoF Ministry of Finance

BPOM

Badan Pengawas Obat dan Makanan (Drug and Food Supervisory Agency) MoHA Ministry of Home Affairs

BPS

Badan Pusat Statistik (Central Bureau of Statistics) MP3EI Masterplan for Acceleration and Expansion of

Indonesia’s Economic Development CDP Cikarang Dry Port MTEF Medium-Term Expenditure Framework

CMEA Coordinating Ministry for Economic Affairs Musrenbang Musyawarah Rencana Pembangunan (Multi stakeholders consultation forum)

CPI Consumer Price Index NGO Non-Governmental Organization

CPS Country Partnership Strategy NILITS

National Integrated Logistics and Intermodal System

CPSPR Country Partnership Strategy Progress Report NLB National Logistics Blueprint CY Calendar Year OBA Output Based Aid

DAK Dana Alokasi Khusus (Special Allocation Funds) OECD PEACH

Organization forEconomic Co-operation and Development Public Expenditure Analysis and Capacity Harmonization

DG Director General PER Public Expenditure Review

DPR Dewan Perwakilan Rakyat Daerah (People’s Consultative Assembly) PFM Public Financial Management

DSF Decentralization Support Facility PINTAR Project for Indonesian Tax Administration Reform

EU European Union PKH Program Keluarga Harapan (Conditional Cash Transfer)

FDI Foreign Direct Investment PMK

Peraturan Menteri Keuangan (Minister of Finance Regulation)

FIRM DPL Financial Sector and Investment Climate Reform and Modernization Development Policy Loan PNPM

Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment)

FX Foreign Exchange PP Peraturan Pemerintah (Government Regulation)

GFMIS Government Financial Management Information System PPP Public-Private Partnership

GFMRAP Government Financial Management and Revenue Administration Project

PPPITA

Private Participation in Infrastructure Technical Assistance

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GoI Government of Indonesia PSO Public Service Obligation

GoJ Government of Japan PT. KAI PT Kereta Api Indonesia (Indonesia Railway Company)

ICR Implementation Completion and Results RPJMN Rencana Pembangunan Jangka Menengah Nasional (National Medium Term Development Plan)

ICT Information and Communication Technology RTRWN Rencana Tata Ruang Wilayah Nasional (National Area Management Plan)

IDPL Infrastructure Development Policy Loan SBI Sertifikat Bank Indonesia (Bank of Indonesia Certificate)

IGF Infrastructure Guarantee Fund SBUN Sub Bendahara Umum Negara (General Operation Treasury)

IIFF Indonesia Infrastructure Financing Facility Sistranas Sistem Transportasi Nasional (National Transportation System)

ILGR Initiative for Local Government Reform SOE State Owned Enterprise IMF International Monetary Fund SSO Single Sign-On Mechanism INKINDO

Ikatan Nasional Konsultan Indonesia (National Association of Consulting Professionals) SUN Rupiah-denominated tradable Government

securities

INPRES Instruksi Presiden (Presidential Instruction) UKP4

Unit Kerja Presiden Bidang Pengawasan dan Pengendalian Pembangunan (Presidential Working Unit for Supervision and Management of Development)

INSTANSI DPL Institutional, Tax Administration, Social and Investment Development Policy Loan VGF Viability Gap Financing

INSW Indonesia National Single Window system USDRP Urban Sector Development and Reform Project

INTR Indonesia National Trade Repository VSL Variable Spread Loan ITB Institute Technology of Bandung WDR World Development Report JABODETABEK Greater Jakarta WINRIP Western Indonesia Roads Project

Jamkesmas Jaminan Kesehatan Masyarakat (Health Insurance Reform Scheme) yoy Year over year

JICA Japan International Cooperation Agency

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COUNTRY

Operation Name

CONTENTS

Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Program Performance in ISRs H. Restructuring

1. Program Context, Development Objectives and Design ............................................ 1 2. Key Factors Affecting Implementation and Outcomes .............................................. 4 3. Assessment of Outcomes .......................................................................................... 10 4. Assessment of Risk to Development Outcome ......................................................... 19 5. Assessment of Bank and Borrower Performance ..................................................... 21 6. Lessons Learned........................................................................................................ 23 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners........... 25 Annex 1. Bank Lending and Implementation Support/Supervision Processes ............. 26 Annex 2. List of People Interviewed ............................................................................ 28 Annex 3. Borrower’s Comments on Draft ICR ............................................................ 29 Annex 4. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 30 Annex 5. Development Partners’s Co-financing .......................................................... 31 Annex 6. List of Supporting Documents ...................................................................... 32

MAP

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A. Basic Information ICR Date: 10/31/2014 ICR Type: Core ICR

P124006 - First Connectivity

Development Policy Loan P144774 - Connectivity

Development Policy Loan 2

L/C/TF Number(s) IBRD-82090 IBRD-82090, IBRD-83050

Country Indonesia Indonesia

Borrower REPUBLIC OF INDONESIA REPUBLIC OF INDONESIA

Lending Instrument DPL DPL

Original Total Commitment USD 100.00M USD 300.00M

Revised Amount: USD 100.00M USD 300.00M

Disbursed Amount USD 100.00M USD 300.00M

Implementing Agencies BAPPENAS

BAPPENAS

Cofinanciers and Other External Partners

ADB ADB JICA AFD (L’Agence Française de Développement)

B. Key Dates



Development Policy Loan 2 Concept Review 06/22/2012 04/25/2013 Appraisal 10/04/2012 09/25/2013 Approval 11/20/2012 11/19/2013 Effectiveness Original Date N/A N/A Revised / Actual Date(s) N/A N/A Restructuring(s) N/A N/A Midterm Review Original Date N/A N/A Revised / Actual Date(s) N/A N/A Closing Original Date 04/30/2013 04/30/2014 Revised / Actual Date(s) 04/30/2013 04/30/2014

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C. Rating Summary C.1 Performance Rating by ICR

Overall Program Rating

Outcomes Moderately Satisfactory

Risk to Development Outcome Substantial

Bank Performance Moderately Satisfactory

Borrower Performance Moderately Satisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Performance

Overall Program Rating (a) Bank Performance in Ensuring Quality at Entry(i.e., performance through lending phase)

Moderately Satisfactory

(b) Quality of Supervision(including of fiduciary and safeguards policies) Moderately Satisfactory

Borrower Performance (a) Government Performance Moderately Satisfactory (b) Implementing Agency or Agencies Performance Moderately Unsatisfactory

C.3 Quality at Entry and Implementation Performance Indicators




Implementation Performance

Potential Prob. Program at any time (Yes/No) No No

Problem Program at any time (Yes/No) No No

DO rating before Closing/Inactive status N/A N/A

QAG Assessments (if any)

Quality at Entry (QEA) None None

Quality of Supervision (QSA) None None

D. Sector and Theme Codes

P124006 - First Connectivity Development Policy Loan

P144774 - Connectivity Development Policy Loan 2

Sector Codes (as % of total Bank Financing) General energy sector General industry and trade sector

8% / 0% 22% / 0% General information and communications sector General information and communications sector 0% / 20% 0% / 20% General transportation sector General public administration sector

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44% / 50% 11% / 10% General water, sanitation and flood protection sector General transportation sector 8% / 0% 56% / 40% Health Other domestic and international trade

9% / 0% 0% / 30% Other domestic and international trade Telecommunications 0% / 30% 11% / 0% Telecommunications 31% / 0%

Thematic Codes (as % of total Bank Financing) Infrastructure services for private sector development City-wide Infrastructure and Service Delivery

43% / 25% 34% / 28% Regional integration Infrastructure services for private sector development 13% / 25% 27% / 25% Rural services and infrastructure Regional integration

13% / 25% 10% / 25% Trade facilitation and market access Trade facilitation and market access 31% / 25% 29% / 25% E. Bank Staff

Positions At ICR

Vice President: Axel van Trotsenburg

Country Director: Rodrigo A. Chaves

Practice Manager/Manager: Mona E. Haddad

Task Team Leader: Sjamsu Rahardja

ICR Team Leader: Sjamsu Rahardja

ICR Primary Author: Luis Alberto Portugal Perez Brasukra Gumilang Sudjana

At Approval




Vice President: Pamela Cox Axel van Trotsenburg

Country Director: Stefan G. Koeberle Rodrigo A. Chaves

Practice Manager/Manager: James A. Brumby James A. Brumby

Task Team Leader: Sjamsu Rahardja Sjamsu Rahardja

F. Results Framework Analysis Program Development Objectives (from Program Document) The overall goal of the Connectivity DPL program is to assist the Government of Indonesia to strengthen the policy framework for improved national trade logistics, transportation, ICT, and trade facilitation. Policy reforms supported by this operation focus on more specific objectives:

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(i) Strengthening National Coordination and Regulation through establishment of regulatory and institutional frameworks for improved coordination and effectiveness in implementation of the connectivity agenda;

(ii) Strengthening Intra-island Connectivity through improved connectivity among and between growth poles, with improved regulatory framework for land acquisition for public purpose development and optimal use of resources for sustainable improvement and maintenance of island-transport network;

(iii) Improving Inter-island Connectivity through improved access, efficiencies and service performance in ICT and domestic shipping; and

(iv) Improving International Connectivity (trade facilitation) by strengthening the institutions and processes in handling traffic and trade volume.

Revised Program Development Objectives (if any, as approved by original approving authority) Not applicable (N/A) (a) PDO Indicator(s)

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Indonesia Connectivity Development Policy Loan – P124006 Indonesia Second Connectivity Development Policy Loan – P1447741

Indicator Baseline Value Target Values - P124006 (DPL1)

Target Values - P144774 (DPL2)

Actual Value Achieved at Completion or Target Years of DPL Series

Pillar 1: Strengthening National Coordination and Regulation

Indicator 1:

1st Connectivity DPL (DPL1): Improved coordination and implementation of policy reforms in logistics and connectivity 2nd Connectivity DPL (DPL2): Improved guidance in policy formulation in trade logistics reform

Value (quantitative or Qualitative)

Ineffective policy making on logistics and connectivity by different ministries/agencies (DPL1) As of 2011, the absence of a national framework caused policies on trade logistics to be driven by ad-hoc sectoral regulations (DPL2)

Better policy making process through effective functioning of the Connectivity Working Group and National Logistics Team

By end of 2014 National Logistics Strategy have been internalized by relevant agencies for formulation and identification of policy reforms agenda in trade logistics

The Connectivity Working Group meets regularly and has released annual reports on the progress of the Logistics Blueprint, ICT development, and Transportation and Energy policies.2 The Logistics Blueprint is ‘internalized’ in the Ministry of Transportation’s strategic plan and implemented, incl. the opening up of Bitung and Kuala Tanjung ports to international traffic and construction of Kalibaru as extension of Tanjung Priok port.3

Date achieved 10/11/2012 10/12/2013 10/10/2014 10/29/2014

Comments (incl. % achievement)

Achieved (100%). The targets have been achieved. Improved logistics coordination could also serve the new Government’s focus on maritime connectivity and logistics, as reflected by the creation of the new Coordinating Ministry for Maritime Affairs.

1 The table includes the indicators in both DPLs. Some indicators were refined, or added to the second Connectivity DPL 2 Connectivity Working Group, 2014, “Laporan Tim Kerja Konektivitas 2013 / Report of the Connectivity Working Group 2013” 3 Supply Chain Indonesia, January 23, 2013, “Implementasi Rencana Aksi Sektor Transportasi Dalam Cetak Biru Pengembangan Sistem Logistik Nasional / The Implementation of Transport Sector Action Plan in the National Logistics System Blueprint”.

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Indicator 2:

1st Connectivity DPL: Effective application of VGF mechanism to attract private investments in PPP projects that improve connectivity 2nd Connectivity DPL: Establishment of Indonesia VGF Program to attract private investments in PPP projects that improve connectivity


As of 2012 no PPP project has benefited from such a mechanism

Application of VGF mechanism to support PPP projects

VGF is budgeted in the 2014 Budget and used to make at least one infrastructure PPP project that was brought to the MoF for VGF support processed through the VGF lifecycle to make it financially viable and thereby advancing development of privately financed infrastructure

VGF is budgeted in the 2014 State Budget.4 Three projects have been processed and short-listed for VGF funding. But, none has been selected due to the reluctance of the former Minister of Finance to extend public financial support for private projects due to their long-term fiscal risks.5

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Partially achieved (50%). The target that VGF is budgeted in 2014 has been achieved. Although the actual application and the use of this allocation for a PPP project is delayed, the new Minister of Finance, formerly Vice Minister of Finance, is highly likely to proceed with VGF approval, considering that he was instrumental in designing the VGF scheme as Vice Minister, and has made statements to this effect soon after taking office as Minister of Finance.6

Pillar 2: Strengthening Intra-island Connectivity7

4 Ministry of Finance, 2014 Financial Note and State Revenues and Expenditure Budget 5 Bisnis Indonesia, June 10, 2014 6 Minister of Finance, Bambang S. Brodjonegoro, was quoted: “To invite private sector participation, … there will be support from the Government through guarantees and viability gap fund,” Ministry of Finance, November 5, 2014, “Tekan Pendanaan Infrastruktur dari APBN, Pemerintah Dorong KPS / The Government is pushing for PPPs to reduce infrastructure financing from State Budget,” http://www.kemenkeu.go.id/Berita/ tekan-pendanaan-infrastruktur-dari-apbn-pemerintah-dorong-kps 7 A proposed policy action on the establishment of an agency to coordinate and plan urban transport system in the Greater Jakarta region appeared in the PD of DPL1 but was not retained in the loan document.

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http://www.kemenkeu.go.id/Berita/

Indicator 3:

1st Connectivity DPL: Improved certainty, transparency, and participation during land acquisition process for public infrastructure projects 2nd Connectivity DPL: Greater clarity, certainty, and transparency of the land acquisition process for public infrastructure projects


Uncertainty concerning the cost, compensation level, and length of land acquisition process for public infrastructure projects (DPL1) As of 2011 there was uncertainty concerning the cost, compensation level, and length of the land acquisition process for public infrastructure projects (DPL2)

Effective application of the provisions in the new Land Acquisition Law, in particular on due process, public notice, compensation, independent review of pricing of affected assets

By the end of 2014, adoption and effective application of the provisions in the new legal framework on land acquisition, in particular on due process, public notice, compensation, independent review of pricing of affected assets leading to a speedier and less conflict-ridden process of land acquisition for public purposes

Land acquisition guidelines (Presidential Regulation No. 71/2012; Head of Land Agency Regulation No. 5/2012, Minister of Finance Regulation No. 13/PMK.02/2013, Minister of Home Affairs Regulation No. 72/2012) have been adopted, but will not be effectively applied until January 2015.8

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Achieved (100%). The guidelines have been adopted, but not applied yet. The difference between the target date of end of 2014 and the letter of the law, which sets January 2015 as the effective date of the application of new land acquisition process (see footnote 8), does not constitute a delay, as this difference is deemed insignificant.

Indicator 4: 1st Connectivity DPL: Start the process towards separation of accounts of PT KAI 2nd Connectivity DPL: Improved clarity and transparency in the provisions and reimbursement of a Public Service Obligation (PSO) in railway sector


The current accounting system does not allow the separation of railways assets (DPL1) As of 2011 PSO calculations were negotiated and therefore imposed great uncertainty on the railway operator (DPL2)

Establishment of an accounting system to help MoTr make informed decisions on drafting relevant regulations to implement the next stages of the railways reform

By the end of 2014 PSO service by the railway operators are compensated based on the calculation method determined in Minister of Transport guidelines, which provides certainty on the amounts to be received and thus the possibility to undertake service improvements

PSO allocation for 2014 already uses the new guidelines, using new PSO formula.9 Yet, there is a delay in the approval for the railway subsidy budget by the new Parliament.

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014 Comments Partially achieved (50%). The PSO calculation guidelines (Minister of Transport Regulation

8 “Current land acquisition process (prior to the issuance of this regulation) shall be completed at the latest by 31 December 2014.” Presidential Regulation No. 71 Year 2012, Chapter X, Article 123, paragraph (3) 9 Nugrahini, Yuli, 2012, “Analisis Kerja Pelaksanaan Kewajiban Pelayanan Publik Bidang Angkutan Kereta Api Penumpang Kelas Ekonomi / Analysis of the Implementation of Economy-Class Passenger Train Public Service Obligation,” Jurnal Perencanaan Wilayah dan Kota, Vol. 23, No. 1, April 2012, pp. 19-36

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(incl. % achievement) PM.10/2013) provide budgetary certainty as to how much the railway company would need to provide subsidized economy-class fares. This target is achieved for 2014. The initial target of establishing an accounting system can be seen as part of the guidelines. But, the approval for actual payment for the railway subsidy budget is delayed by the new Parliament sworn in on October 1st, 2014.10

Indicator 5: 2nd Connectivity DPL: Improved clarity and transparency over reimbursement for Infrastructure Maintenance Operation (IMO) and payment of Track Access Charges (TAC) in the railway sector


As of 2011, the Government considered expenses for IMO by the railway operator equals the TAC that the Government should received

By the end of 2014, the Government has included provisions of IMO in the State Budget which will provide funds for infrastructure maintenance and trigger the need to pay TAC. This in turn will lay the background to open access to rail infrastructure for different operators

IMO and TAC payments are allocated in the 2014 state budget, but implementation is expected to be delayed due to a need for another regulatory change, which is not part of the DPL.

Date achieved 10/12/2013 10/10/2014 10/29/2014


Achieved (100%). The target of the inclusion of provisions for IMO and TAC payments in State Budget has been achieved. But, actual implementation is expected to be delayed due to an absence of the IMO and TAC provisions in the Government Regulation (GR No. 6 Year 2009, as revised by GR No. 74 Year 2013) governing non-tax revenue collection and payments by the Ministry of Transportation. However, this regulatory requirement was not part of the DPL (see M&E section for further explanation).11

10 Reference: http://www.ruangpojok.com/berita/ekonomi/pemerintah-akan-cabut-subsidi-kereta-api-jarak-sedang-dan-jauh.html 11 State Auditory Board of the Republic of Indonesia, 2014, Audit Report on the Financial Report of the National Government, 28 May, 2014; Sinar Harapan, June 18, 2014

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Indicator 6:

1st Connectivity DPL: Better management practice for construction and maintenance of public roads 2nd Connectivity DPL: Acceptance by DG-Highway of a performance-based contract to support more efficient management of national road maintenance and rehabilitation


Most of the current road maintenance activities are implemented using force account (DPL1) As of 2011, road maintenance and rehabilitation are mostly carried out by force account (managed by DG-Highway) and there is no performance-based contract (except for two pilots) (DPL2)

Expanded use of performance based contracts

By the end of 2014, Performance-based contracts will be used for at least 50 km of the national road network, leading to better maintenance of road and greater satisfaction of users

Performance-based contract for highways is piloted by the DG for Roads, Ministry of Public Works. Between 2011 and 2014, contracts were awarded for the maintenance of about 120 km of roads in Central and East Java and Central Kalimantan, using PBC.12

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Highly achieved (240%). Actual achievement exceeded target. The implementation of PBC for road projects was and is still in its pilot stage. It was initially piloted in three segments in Central Java, with a further 120 km of maintenance contracts awarded between 2011 and 2014. In June 2013, the Ministry of Public Works submitted, for parliamentary approval, the budget for projects that will expand PBC coverage to 100-250 km of roads over the next several years.13

Pillar 3: Improving Inter-island Connectivity

Indicator 7: 1st Connectivity DPL: Increase access for broadband internet services in Indonesia 2nd Connectivity DPL: Progress made in the development of broadband services to remote and under-served areas in eastern Indonesia


5 percent of Indonesian population with broadband access in 2011 (DPL1) As of 2011, ICT Fund was not used due to absence of implementing guidelines (DPL2)

10 percent of Indonesian population with broadband access by 2014

By the end of 2014, completion of tender processes for the ICT Fund to support the first phase of broadband development to underserved areas in eastern Indonesia

The ICT Fund tender process is on hold as an unintended consequence of an unrelated corruption case at the Ministry of Communications and Information.14

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Not achieved (0%). The ministry is under investigation by the Government’s audit office for the management of its Universal Service Fund, which is unrelated to this DPL or any Bank project. Because of this case, major programs at the Ministry are also halted, including the tendering process for ICT Fund.

12 Data from the Ministry of Public Works, obtained in October 2014 13 Ministry of Public Works, June 12, 2013, http://www.pu.go.id/main/view/8587 14 Detikinet, April 4, 2013

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Indicator 8: 2nd Connectivity DPL: Progress made in the development of individual ports


As of 2011, absence of guidelines for modernizing Indonesia’s sea port network leading to fragmented and ineffective policy-making in sea ports development

By the end of 2014, informed policy-making in sea port development as demonstrated by finalization of at least 2 individual port development plans based on the Ministry of Transport Regulation to modernize Indonesia’s domestic port network

National Port Master Plan is in place. Individual port development plans include: Cilamaya, Kalibaru, Kuala Tanjung, Teluk Lamong, and Tanjung Priok expansion.15 The issuance of individual port development plans for Teluk Lamong and Tanjung Priok have been used as basis for implementing large scale port development and expansion projects in these two locations.

Date achieved 10/12/2013 10/10/2014 10/29/2014


Highly achieved (450%). The number of actual individual port development plans issued by the Government, as well as actual construction of two large scale ports, exceeded the target of 2 port development plans.

Pillar 4: Improving International Connectivity

Indicator 9: 1st Connectivity DPL: Improved Logistics Performance Indicators (LPI) score in customs and border management 2nd Connectivity DPL: Improvement in the management of the INSW system


LPI score in customs and border management of 2.53 in 2012 As of 2011 the INSW is temporarily managed by an ad-hoc team

LPI score in customs and border management above 2.7 by 2014

By the end of 2014 the Government has started transforming the managerial and institutional set-up of the INSW towards an INSW agency that manages the customs clearance process in the future

Indonesia’s LPI score for Border Agencies has increased from 2.53 in 2012 to 2.87 in 2014.16 Presidential Regulation No. 76/2014 on the Management of INSW Portal, issued on 17 July 2014, set out that a Ministry of Finance Task Force, rather than an agency, is responsible for the management of the INSW. It also established a steering committee under the leadership of the Coordinating Minister, with other economic ministers as members.17

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Achieved (100%). The target for the first DPL was surpassed. The task force has operational, including technical coordination, responsibility for the INSW, supported by ministerial working units. The steering committee is responsible to provide strategic guidance for the task force and

15 Minister of Transportation Regulation No. KP414/2013 16 World Bank, Logistics Performance Index 2012 and 2014 17 Presidential Regulation No. 76/2014

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for the participating ministries. This two-prong structure will likely lead to a stronger institutional structure in the future. In addition, the 2014 LPI score for border agencies exceeded the target in the first DPL. INSW is currently available not only in Tanjung Priok (Jakarta port) but in an increasing number of ports.

Indicator 10:

1st Connectivity DPL: Improve efficiency in trade facilitation for cross-border trade as demonstrated by reduction in import cargo dwell time in Jakarta seaport which handles 70 percent of international cargo volume 2nd Connectivity DPL: Improved process in submitting documents for the customs clearance process through the INSW system


Average import cargo dwell time of 6.3 days in 2011 As of 2011 traders had to submit documents for import clearances to different agencies ICT systems using different identifications

Maximum average import cargo dwell time of 5 days by 2014

By the end of 2014, Single-Sign On (SSO) feature facilitates submission of documents for import clearance to the Food and Drug Agency, Ministry of Health, Ministry of Trade, and the Quarantine Agency

Dwell time has decreased from 6.3 days in Nov 2012 to 5.2 days in Sep 2014.18 As of Sept 2014, the SSO mechanism comprises the Food and Drug Agency, the Ministry of Trade, Plant Quarantine, Animal Quarantine, the Ministry of Health, and the Nuclear Power Monitoring Agency (Bapeten).19 The SSO allows traders to use unique ID to process on-line permits in those agencies.

Date achieved 10/12/2012 10/12/2013 10/10/2014 10/29/2014


Highly achieved (150%). Actual achievement of 6 ministries/agencies linked to INSW through the SSO mechanism exceeded the target of 4 ministries/agencies. Dwell time has decreased throughout the period of the DPL. In particular, it has decreased sharply since Jan 2014 as shown in Figure 3 in the text. Although dwell time remains slightly above the target of 5 days, it is likely to reduce further in the remaining months of 2014.

(b) Intermediate Outcome Indicator(s) N/A G. Ratings of Program Performance in ISRs20 N/A H. Restructuring (if any) N/A

18 Jakarta International Container Terminal, 2014 19 INSW portal 20 An ISR is not necessary for this programmatic DPL series. For programmatic operations, ISRs are necessary only if the time between the last operation’s Board date and the next operation’s Board date exceeds 12 months.

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1. Program Context, Development Objectives and Design

1.1 Context at Appraisal Economic context The economy proved resilient to the 2008/9 global financial crisis and the subsequent slow and uneven recovery in high-income economies. Growth slowed from 6.0 percent in 2008 to 4.6 percent in 2009, but subsequently rebounded and has remained in the 5.8-6.5 percent range in every quarter since the beginning of 2010. This resilience can be attributed to strong initial conditions going into the crisis, the related availability and deployment of sizable fiscal and monetary buffers to cushion the shock, and Indonesia’s lower dependence on external demand relative to many of its regional peers. Consumer inflation moderated, from an average of 8.7 percent per year in 2003-08 to 4.9 percent in 2009-12, helped by the absence of any major food or administered price shocks through mid-2013. This solid performance attracted strong investor interest, fueled by abundant global liquidity. However, portfolio investment inflows, although generally strong, were prone to bouts of significant volatility, providing a reminder that Indonesia remains susceptible to external shocks through the financial channel, given high foreign ownership shares of both stocks and bonds. By the time of the second Connectivity DPL, Indonesia’s economy was showing signs of a slowdown, having been hit by a negative trade shock as global commodity prices and demand have fallen since 2011. Over 2012, the major drag on growth was net exports, with export volumes rising just 2.0 percent but import volumes increasing by a more robust 6.7 percent, reflecting the strength of domestic demand; net exports consequently reduced growth in 2012 by 1.5 percentage points. Investment growth also fell over the second half of 2012, and by the start of 2013 was decelerating from 12.5 percent yoy in Q2 2012 to 4.7 percent yoy in Q2 2013. The main cause of weaker investment growth has been a sharp slowdown in machinery and equipment spending, and the softening in international commodity prices since early 2011 has likely filtered into investment. On the production side, weakness was concentrated in commodities sectors, such as mining and quarrying (contracting 1.2 percent yoy in Q2 2013), compared with more robust performance in manufacturing (up 5.8 percent), construction (up 6.9 percent), and especially the services sector (up 7.5 percent). Indonesia’s current account balance has deteriorated since 2011. In 2012 Indonesia recorded its first annual current account deficit since 1997, of US$ 24.2 billion or 2.8 percent of GDP, compared with a small surplus of 0.2 percent of GDP in 2011. Pressure on the current account has persisted in 2013, with quarterly deficits of US$ 5.8 billion (2.6 percent of GDP) and US$ 9.8 billion (4.4 percent of GDP) recorded in Q1 and Q2. While the bulk of this swing was due to decreasing goods trade surpluses, sizable structural deficits on the services trade and income sub-accounts also continued to weigh on the overall current account balance. Policy and political context From 2001 to 2010, Indonesia experienced a deepening and entrenching of democracy and a return to stable and strong economic growth. The beginning of the current administration’s second tenure saw widespread public disenchantment with weak law enforcement and high-profile corruption cases. Yet despite political tensions within the Parliament, the coalition structure and consensus-oriented approach of the ministerial cabinet were maintained. Policy-making continued to benefit from the reform-orientation and technocratic background of several key cabinet members as well as leadership from the President and Vice President. A cabinet

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reshuffle in the second half of 2011 saw some significant changes, including in the economic ministries, but the overall reform orientation of the cabinet has remained. By 2013, the political outlook was clouded by uncertainties over who might become the next president and the direction of the new government. Adding to this, were the uncertainties over the prospects for the continuation of market-oriented policymaking. The former Jakarta governor increasingly gained popularity, as a clean governance reformer with a focus on improving public service delivery, especially to the poor. Meanwhile, as election year approached, the political pressure for the government to take more populist policies was mounting. Resistance for reduction in fuel subsidies, regulatory uncertainties in the extractive sectors (i.e., mining, oil, and gas), and pressure to increase regional minimum wage rates were among the politically sensitive issues that the government was confronting. The uncertainties undermined the already stretched mandate of the Connectivity Working Group in charge of policy reform in the area of connectivity. Strategic context Improved connectivity and national market integration have been recognized as important means to reduce poverty and to increase competitiveness and economic growth. The connectivity agenda was reflected in the Medium-Term National Development Plan (RPJMN) 2010-2014 and the Masterplan for “Acceleration and Expansion of Indonesia’s Economic Development 2011-2025” (MP3EI). The RPJMN recognized improved transportation infrastructure as an important component in achieving better connectivity and market integration. Meanwhile, the MP3EI, launched in 2011, sought to accelerate growth by: (i) fostering centers of growth across economic corridors; (ii) strengthening national connectivity to link growth poles across and within economic corridors; and (iii) complementing connectivity by improving human resources capabilities and increasing investments in research and development. The plan set an ambitious target for Indonesia to grow beyond 7 percent annually and achieve a status of an emerging industrialized country by 2025. The first and second Connectivity DPLs supported the 2009-2012 Country Partnership Strategy Progress Report (CPSPR) and the 2013-2015 CPS, respectively. The first Connectivity DPL was fully in line with the emphasis of the CPSPR, issued in 2011, on strengthening Indonesia’s institutions and systems, a key cross-sectoral engagement theme. The second Connectivity DPL supported the broader goal of the 2013-15 CPS, which is to enhance Indonesia’s domestic capacity for reducing poverty and boosting equitable and sustainable prosperity. The CPS highlighted the Connectivity DPL program as a key World Bank Group (WBG) instrument, particularly in the pro-growth engagement area, by promoting prosperity through enhanced connectivity, strengthened competitiveness and promotion of infrastructure development. The CPS recognized that the key to addressing connectivity challenges lies in policy coordination and implementation across multiple levels of government and consultation with the private sector The Connectivity DPL series was designed as a two-year programmatic DPL series. To ensure full ownership of the program, a detailed mapping out of the programmatic DPL series was developed jointly with Bappenas, the Coordinating Ministry for Economic Affairs and the relevant line ministries/agencies. The Connectivity DPLs provided a time-bound process for GoI to coordinate and implement policy reforms on connectivity. This process was critical to ensure sustained follow-up for Government and parliamentary initiatives in issuing regulations to support the connectivity agenda. Given that the implementation of GoI’s connectivity agenda involved agencies beyond the core economic ministries, the DPLs also supported GoI’s efforts to strengthen the coordination and reform processes among the various agencies, including the

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Ministry of Finance, Ministry of Transport, and Ministry of Public Works. The Government has indicated the possibility of continuing the engagement through a follow-on Connectivity DPL operation. However, considering the current political transition, actual design and preparation for a third DPL would have to wait until early 2015 at the soonest.

1.2 Original Program Development Objectives (PDO) and Key Indicators (as approved) The overall goal of the Connectivity DPL program is to assist the Government of Indonesia to strengthen the policy framework for improved national trade logistics, transportation, ICT, and trade facilitation.

The original Key Outcome Indicators of DPL1 focused on contributing to the achievement of the following targeted outcomes by 2013: • Better coordination and implementation of connectivity reform efforts, as measured by better

policy making process through effective functioning of the Connectivity Working Group and National Logistics Team to coordinate and implement policy reforms;

• Improved intra-island connectivity, as measured by increase investors’ confidence, stakeholders participation in the national connectivity agenda, strengthen progress in restructuring of the railway sector, and improve planning and implementation of public road investment;

• Improved inter-island connectivity, as measured by strengthen ICT connectivity between Eastern and Western Indonesia and introduce more competition in broadband services;

• Improved international connectivity, as measured by reduced time for import and exporting.

1.3 Revised PDO and Key Indicators, and Reasons/Justification There were no changes to the PDO between the first and second Connectivity DPL. The Key Outcome Indicators had minor revisions for the 2014 targeted outcomes. These were: • Strengthened National Coordination and Regulation, as demonstrated through increased

Government effectiveness and rapidity in supporting infrastructure development, and use of the Viability Gap Financing;

• Strengthened intra-island connectivity, as measured by effective application of the legal and regulatory frameworks for land acquisition, clear PSO compensation for the railway operator and use of performance based contracts in the national road network;

• Improved inter-island connectivity, as measured through increased share of Indonesian population with broadband access and informed policy-making on sea port development; and

• Improved international connectivity through improved customs and border management in facilitating trade.

The changes reflected a shift in policy focus for more concrete regulatory deliverables and more advanced reforms that exceeded previous expectations in the respective policy areas. For example, the focus of the first pillar shifted from supporting the Connectivity Working Group and the National Logistics Team in the first DPL to VGF mechanism in the second DPL. For the second pillar, the shift reflected developments in the land acquisition, railway, and road sector regulations. The third pillar, in the second DPL, added an important element of inter-island connectivity: port development. Finally, the last pillar expanded on the institutional mechanisms of the Indonesia National Single Window. These changes are also examples of the need to maintain flexibility in a multi-year DPL reform agenda and the usefulness of having benchmarks to map out the necessary reforms.

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1.4 Original Policy Areas Supported by the Program: Policy reforms supported by this operation focus on the following more specific objectives:

(i) Strengthening National Coordination and Regulation through establishment of regulatory and institutional frameworks for improved coordination and implementation of the connectivity agenda;

(ii) Strengthening Intra-island Connectivity through improved connectivity among and between growth poles, with improved regulatory framework for land acquisition for public purpose development and optimal use of resources for sustainable improvement and maintenance of island-transport network;

(iii) Improving Inter-island Connectivity through improved access, efficiencies and service performance in ICT and domestic shipping; and

(iv) Improving International Connectivity (trade facilitation) by strengthening the institutions and processes in handling traffic and trade volume.

1.5 Revised Policy Areas There were no major changes except for an addition of domestic shipping objective under pillar III. The absence of a domestic shipping policy action in the first DPL was due to the request of the Ministry of Transportation, who felt unsure that the National Port Master Plan would be finalized in time. The Master Plan was signed during the discussions for the second DPL.

1.6 Other significant changes N/A

2. Key Factors Affecting Implementation and Outcomes

2.1 Program Performance Both DPLs were prepared and delivered within their time frame. The four specific objectives were maintained throughout the two DPLs with minor changes. Policy actions as stipulated in the Program Document were fulfilled at the time of the approvals. The final achievement status of the indicators is detailed in Section F (a) on PDOs above. Progress of the prior actions reflected regulatory development and their contribution to the Government’s connectivity priorities. Table 2 shows the Policy Actions for each pillar, as agreed and implemented by the Government. Policy actions numbers 1 and 7 – on the National Logistics System Blueprint and on road PBC – were not carried on in the second DPL, but the indicators were refined to make them more measurable. Policy action number 2 was taken further in the second DPL to reflect a more specific action relating to the VGF funding mechanism for PPP projects. Policy action number 3, on land acquisition, was developed further from higher legal products – a Law and a Presidential Regulation – in the first DPL into two policy actions (numbers 3 and 4) to cover more specific land acquisition guiding regulations in the second DPL. Similarly, policy action number 5 was also developed into two policy actions in the second DPL – numbers 5 and 6 –, to specify regulatory guidelines for railway sector subsidy and TAC and IMO payments. Policy action number 8 evolved from a regulatory action to a more specific action relating to the use of the ICT Fund. Policy action number 9 – on the Port Master Plan – was not

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ready to be included in the first DPL, but it firmed up by the time of the second DPL. Policy action number 10 moved from regulatory action in the first DPL to the establishment of an agency in the second DPL. Policy action number 11 expanded on the number of agencies linked to the SSO system of the INSW. One emerging pattern from this DPL is the lag between policy and regulatory reforms and actual implementation. Therefore the full achievements of the DPLs will take longer to materialize. The outcomes and impact of the DPL will continue to be constrained by layers of administrative, bureaucratic, legal, or political hurdles. There are also some specified lags between the issuance/signing of a regulation and the effective date of implementation of the regulation – these include, for example, the land regulations and the INSW regulation. These administrative lags would need to be taken into consideration when measuring achievements of the DPLs. The DPLs established traction in furthering important connectivity policy issues and institutional development. The DPLs were able to contribute to advancing significant agenda, including on land acquisition, PPP financing, and INSW. Progress on specific sectors – such as railway, roads, and ports – also reflected important institutional development. Despite limits to technical-level buy-in, and although the pace of reforms slowed during the political transition in mid-2014, connectivity remains an important component of Indonesia’s development strategy and is likely to continue under the new Government that took office in late October 2014. The Connectivity DPL series, in spite of the political transition at the time of the writing of the ICR, helped strengthen institutional foundations within the Government, as well as putting in place the necessary interface between the Bank and the Government, that could be relevant and responsive to the connectivity agenda of the new Government.

Table 1 – Connectivity DPL Series

DPL # Amount Expected Release Date

Actual Release Date

Release

Connectivity DPL USD 100,000,000

October 18, 2012

(1) Regular

Connectivity DPL 2 USD 300,000,000

November 19, 2013

(1) Regular

Table 2 – Status of Policy Actions – First and Second Connectivity DPLs

Reform Aim No Policy Actions supported by the First Connectivity DPL (by September 2012)

Prior Actions supported by the Second Connectivity DPL (by September 2013)

Status

Pillar 1: Strengthening National Coordination and Regulation To strengthen coordination of policy reforms surrounding national connectivity

1 The Borrower has issued a Presidential Regulation (No. 26/2012) establishing the Borrower's national logistics system blueprint and the Coordinating Ministry for Economic Affairs has issued a Ministerial Decree (No. 49/2012) establishing the working team that will coordinate, monitor and evaluate the implementation of the national logistic system blueprint, in support of the connectivity agenda

Fulfilled

5

To establish transparent processes for channeling public funds to viable connectivity infrastructure PPP projects for further market uptake

2 The Fiscal Policy Office of the Borrower’s Ministry of Finance has submitted a draft Ministerial Regulation to the Minister of Finance establishing the mechanism for channeling Government funds to PPP in infrastructure.

The Borrower has signed a Minister of Finance Regulation on operational procedures to implement Minister of Finance Regulation No. 223/2012 on the channeling of government funds to public-private partnership projects in infrastructure.

Fulfilled

Pillar 2: Strengthening Intra-island Connectivity To improve investor confidence and stakeholder participation in the national connectivity agenda

3 The Borrower has issued a land acquisition Law (No. 2/2012) and a Presidential Regulation (No. 71/2012) on land acquisition for public purpose development.

The Borrower, through the National Land Agency, has assigned roles to, and has established the processes for, the relevant agencies of the Borrower when acquiring land for public purpose development through the issuance of technical guidelines (Regulation of the Head of BPN No.5/2012) to implement Law No. 2/2012 and Presidential Regulation No. 71/2012.

Fulfilled

4 The Borrower has issued a Minister of Finance Regulation (No.13/PMK.02/2013) stating which expenditures related to land acquisition for public purpose development are eligible to be covered by the national state budget, and the Borrower has issued a Minister of Home Affairs Regulation (No.72/2012) stating which expenditures related to land acquisition for public purpose development are eligible to be covered by local government budgets.

Fulfilled

To strengthen the restructuring process of the railway sector to make it respond better to growing demand for better services and improved

5

The Borrower has issued a Presidential Regulation (No.53/2012) on Public Service Obligation in railway services, reimbursement of infrastructure maintenance operation, and track access charges, which serves as a catalyst for implementing the first step to separate assets of the state-owned railway company (PT KAI) and move towards a line-of-business management structure

The Borrower has issued guidelines (Minister of Transportation Regulations PM.10/2013 and PM.56/2013) for the provision and reimbursement of Public Service Obligation in the railway sector to provide affordable passenger railway services.

Fulfilled

6

accessibility 6 The Borrower has issued guidelines for provision of (i) Infrastructure Maintenance Operation (Minister of Transportation Regulation PM.67/2013), and (ii) Track Access Charges (Minister of Transportation Regulation PM.62/2013) to support the restructuring process in the railway sector as mandated by the Borrower’s Law No. 23/2007 and by Presidential Regulation (No. 53/2012).

Fulfilled

To improve planning and implementation of public road investment

7 The Borrower has issued DG Highways Circular (No.06/SE/06/2012), which recommends the use of performance based contracting for any road project and has started to award contracts using the referred performance based methodology.

Fulfilled

Pillar 3: Improving Inter-island Connectivity To close the “digital divide” between East and West Indonesia through development of broadband services to Eastern Indonesia

8 The Borrower, through the Ministry of Communications and Information Technology has issued a Ministerial Regulation (No. 23/2012) on the use of the ICT Fund to support the development of broadband ICT infrastructure in underserved areas in Indonesia.

The Borrower has completed the identification of the remote districts (kabupaten) to be covered by the ICT Fund and has estimated the budget requirements for the first phase of telecommunications broadband projects to be financed by the ICT Fund.

Fulfilled

To strengthen development of the roadmap in Indonesia’s port sector and improve domestic sea shipping

9 The Borrower has issued Minister of Transportation Regulation No. KP414/2013 establishing a classification and location for all Indonesian sea ports based on traffic projections in order to establish development plans for each individual sea port for the next twenty years.

Fulfilled

Pillar 4: Improving International Connectivity To increase institutional capacity in trade facilitation to better handle the increasing volume of international trade

10 The Borrower has amended Presidential Regulation No. 10/2008 through the issuance of Presidential Regulation No. 35/2012 to make the Indonesia National Single Window (INSW) system the single reference portal for cross-border trade regulations in the customs clearance process.

The Borrower has decided the legal nature of the agency to be created for the management of the Indonesia National Single Window System

Fulfilled

11 The Borrower has introduced the Agency of Drug and Food Control into the INSW system using the Single Sign-On

The Borrower has expanded the Indonesia National Single Window System by linking the requests for permits made to the Ministry of Trade and the Agency for Plant Quarantine through the Single Sign-On Mechanism to streamline and make more efficient

Fulfilled

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the export and import processes and the quarantine procedures.

2.2 Major Factors Affecting Implementation Several factors contributed to the performance of the Connectivity DPL series. The positive ones include strong government ownership and relevant policy priority. The challenges faced by the DPLs have more to do with nuances related to coordination, programmatic focus, and the use of complementary Bank instruments. Government ownership was strong. The main counterpart for the DPL, the National Development Planning Agency (Bappenas) envisaged the DPLs as tools to accelerate policy and regulatory reforms that the Government was already preparing or planning to prepare. The same was true of the secondary counterpart, the Coordinating Ministry for Economic Affairs. In general, there was a wide consensus on the need for connectivity reforms. The high level of ownership is a reflection of the importance of the connectivity agenda as a Government priority, set out in the Masterplan for the Acceleration and Expansion of Economic Development (MP3EI) and other policy documents such as the Logistics Blue Print and the Connectivity Master Plan. The selection of Bappenas as the main counterpart also seemed sensible at the design stage since the Vice Minister of Bappenas serves as the Chair of the Connectivity pillar of the MP3EI. Yet, there was a gap between the high-level ownership and technical coordination. While coordination at the Vice-Ministerial and echelon 1 (director-generals) levels were strong, coordination at the technical level was not very strong. This was partly due to Bappenas’ lack of convening power. As a planning agency, Bappenas had no effective authority over the implementing ministries/agencies and was not able to force line ministries to meet the deadlines of the policy targets. Another cause of the imperfect technical coordination was the lack of understanding, at the technical level of the line ministries, of the purposes and the uses of the DPL. These resulted in technical coordination meetings that were devoid of substantive discussions on the contributions of the policy actions (and the ministries) to the wider connectivity reforms as stipulated in the MP3EI. This reflects the overall weakness of the implementing structure of Connectivity Agenda. The programmatic design was based on the lessons of previous Indonesian DPLs (core DPLs and FIRM DPL), which found that a programmatic approach would allow for a more meaningful mapping of multi-year reforms and alignment with GoI priorities. The trade-off between a narrowly focused DPL versus a cross-cutting one is a question of balance and proportionality. With the right balance, a cross-cutting DPL could have positive and transformative impact on Government policy reforms. In the case of the Connectivity DPL Series, this design worked to improve strategic coordination and helped to meet the objectives of policy reforms; but some specific targets might not fully contribute to achieve the intended overall impact of improved connectivity. The DPL benefited from the use of complementary Bank instruments. At the time of the DPL, a number of technical assistance and advisory programs were also in place. These included trust funds to support activities on PPP, road maintenance, broadband spectrum, and trade and investment climate. They were used to facilitate discussions with Government counterparts and implementing ministries/agencies. Yet, because of the breadth of the issues covered by the DPL, it would have been better to find a systematic way to link the TAs/TFs to policy impact in the

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overall connectivity agenda. By contrast, the ADB provided one specific TA to accompany its Connectivity DPL series.

2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization: The design of the results framework (Section F (a) and table 2) benefited from the flexibility of a multi-year DPL series to respond to developments in the reform agenda, which was reflected in the changes between the second and the first DPL targets. The second DPL refined the targets for more direct links to policy actions. For example, those relating to the Logistics Performance Index and dwell time were dropped in the second Connectivity DPL in favor of regulatory and qualitative aspects of connectivity. The target for road improvements was also refined from a vaguely worded “Expanded use of performance based contracts” in the first DPL to a more measurable target of 50 kilometers of PBC in the second DPL. In general, these refinements made the targets more realistic and achievable. However, the results framework lacks sometimes direct linkage between Outcome indicators, PDOs, and targets. Cases where there was an absence of linkage include the lack of relevant results indicators for intra-island connectivity outcomes of increasing investors’ confidence and stakeholders’ participation in the national connectivity agenda. Some qualitative targets were also vague and difficult to measure against impact. For example the target on National Logistics Strategy was to have it ‘internalized’ by relevant agencies, while the policy action for the INSW in the second DPL only asked that the Borrower decided on the legal nature of the proposed INSW agency. Some of the implementation risks were either foreseen by the team, fall beyond the scope of the DPL, or were overlooked. For example, coordination risk related to the implementation of the land acquisition regulations was noted in the 2nd Connectivity DPL Program Document. The case of the new Parliament failing to approve the railway subsidy budget causing delay in PSO payments and the case of delays in VGF project selection would be difficult to address, even with a DPL. However, the mismatch between the target date for the effective application of the land acquisition regulations (end of 2014) and the actual letters of the law, which specified that existing projects may use the old guidelines until 31 December 2014, as well as the need for a revision of a Government Regulation that affects IMO and TAC provisions, were clearly overlooked by the team. The monitoring of the DPLs was conducted through regular inter-ministerial meetings of the implementing ministries/agencies, organized by Bappenas. The field presence of the Bank team also allowed for continuous close monitoring of the supported reforms. The Bank team on the ground continuously monitored and evaluated the reforms supported under the project, throughout the preparation, appraisal and implementation of both the first and second Connectivity DPL operations. Monitoring also benefited from policy engagement through other Bank instruments (AAA and TA activities) that have synergies and complementarities. However, as mentioned above, the use of other Bank instruments failed to provide coherence to the connectivity agenda. They have also not improved coordination with the implementing agencies/ministries, whose buy-in was crucial to the performance of the DPL.

2.4 Expected Next Phase/Follow-up Operation A third Connectivity DPL was planned during the appraisal of the second Connectivity DPL. However, considering the transition to a new Government, this plan will need to be

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revisited after the inauguration of the new President in late October 2014. The connectivity agenda will remain relevant for the new Government. Aspects of connectivity in which the incoming President is likely to be interested include inter-island connectivity (maritime highways) and trade facilitation (reduction of dwell time). At the time of the ICR, counterparts at the Coordinating Ministry for Economic Affairs and Bappenas have expressed the relevance and their interest in a subsequent connectivity program.

3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation21 The overall objective of the DPL series could be seen as at the right level of ambition and was likely to be achieved. It sought to “…assist the Government of Indonesia to strengthen the policy framework for improved national trade logistics, transportation, ICT, and trade facilitation.” This objective explains the focus on regulatory reforms and existing, or pipeline, policy actions. The Connectivity DPL series remain relevant with the Government’s medium-term objectives. The DPL supported key reforms of the connectivity component of the RPJMN and the MP3EI, including the integration of different connectivity-related plans – the National Logistics System, the National Transportation System, the regional development and spatial plans, and the development of ICT –, improved coordination function of the Committees for MP3EI, and better trade facilitation. The DPL series also remains consistent with the Bank’s Country Partnership Strategies, both for FY2009-2012 and FY2013-2015.The first DPL was in line with the FY2009-2012 CPS’ focus on strengthening institutions and systems. This cross-sectoral focus was served by the coordination and regulatory reforms that the DPL helped to achieve across the four pillars. The second DPL was also in line with the FY2013-2015CPS, which highlights connectivity and infrastructure as part of the pro-growth engagement area by promoting prosperity. This suggests a rating of High for the relevance of objectives. Programmatic design and implementation followed an analytical framework that the Bank produced in 2010, Connecting Indonesia – A Framework for Action. The report identified the main areas of connectivity improvements – inter-island, intra-island, and international connectivity. It also identified the need for a strong institutional framework – strategic-level coordination, monitoring scheme, and central-local governments coordination –, effective public spending, and smarter regulations. The report suggested that, “In order to achieve a higher level of integration, it is important to develop a structured approach that encompasses the different initiatives, prioritizes reform actions and promotes a high level of coordination between government agencies.”22 The Connectivity DPL Series is a direct follow-up from the analyses provided by the report and should be conducive to achieving the intended objectives. The implementation of the program remains relevant to the overall objective of strengthening connectivity policy frameworks. However, when applied separately, the sub-objectives or policy areas lack coherence and overall impact on connectivity improvements. For example, the intra-island outcome indicators of increased investors’ confidence and stakeholders’

21 As per the advice of CMU during the ICR draft review meeting on October 16, 2014, this section follows the IEG rating scale (High, Substantial, Modest, Negligible) 22 World Bank, 2010, Connecting Indonesia – A Framework for Action, p. 12.

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participation in the national connectivity agenda lack direct linkage to improved connectivity – through which infrastructure investment would be the presumed transmission mechanism, but the measurement of which was absent in the DPL. The direct link between these qualitative and process-oriented reforms to overall connectivity improvement would need to be made more explicit. These do not diminish the importance of institutional reforms and development, on which the DPL is focusing, nor question the decision on the cross-sectoral approach, which can yield a more transformative change. It merely suggests that the implementation relevance to overall objectives and impact may have been stronger. This suggests a rating of Modest for the relevance of design and implementation.

3.2 Achievement of Program Development Objectives 1: Strengthening National Coordination and Regulation Objective: improved coordination and implementation of the connectivity agenda through establishment of regulatory and institutional frameworks Ratings: Substantial The objective under this pillar aimed at specific aspects of coordination reforms in regard to connectivity. In the first Connectivity DPL this meant a focus on operationalizing the National Logistics Blueprint. In the second DPL it focused on an even more specific component of connectivity – the Viability Gap Fund for PPP projects. The government realized the prominence of strengthening policy coordination across ministries and agencies in order to move forward with its connectivity agenda. A weak mandate in resolving bottlenecks on decisions over key priority infrastructure projects can weaken confidence to invest in connectivity infrastructure. In that regard, a National Logistics System Blueprint is considered a best practice to coordinate a national connectivity strategy and could snow-ball into improved overall coordination on other connectivity-related reforms (transport, ICT, ports, roads, maritime connectivity) at the national level. Additionally, the design of a clear, transparent market-based mechanism to channel public sector resources into well-prepared infrastructure PPPs is important to improve their financial viability. The first Connectivity DPL supported institutional steps to operationalize the Logistics Blueprint. This was built on reforms supported by previous DPLs, especially Indonesia DPL Series 7-8, which already identified the Logistics Blueprint as a critical component of the Government’s connectivity agenda. The Logistics Blueprint does not only aim at improving logistics infrastructure, but also service providers, human resources, logistics technology, and streamlining regulations. The first Connectivity DPL sought to further this reform by supporting steps to internalize the Logistics Blueprint into key ministerial working plans and regulations. By the time of the ICR, the target specified in DPL1 of improving the functioning of the Connectivity Working Group and the National Logistics Team is achieved, with both groups meeting regularly and the Connectivity Working Group releasing annual reports on the progress of the Logistics Blueprint, ICT development, and Transportation and Energy policies.23 In the second DPL, no prior action was supported for this policy area, but a target was added, which then sought to internalize the Logistics Blueprint. Throughout the period of the DPL Series, The Logistics Blueprint has been ‘internalized’ in the Ministry of Transportation’s strategic plan and implemented by other ministries. Its ‘big win’ targets have also been implemented and serve as

23 Connectivity Working Group, 2014, “Laporan Tim Kerja Konektivitas 2013 / Report of the Connectivity Working Group 2013”

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reference points for activities such as the opening up of Bitung and Kuala Tanjung ports to international traffic and the construction of Kalibaru as extension of Tanjung Priok port. Initial impact on logistics performance is shown by Indonesia’s improvements along the Logistics Performance Index (LPI). Between 2012 and 2014, its LPI rank moved up by six places, as shown in Figure 1. Its scores also improved for infrastructure, border agencies, and logistics competence, and declined slightly for timeliness, tracking and tracing, and international shipments. Although many other factors affect logistics performance, including increased freight traffic, these improvements showed the fruit of the Government’s priority on improving logistics and connectivity. In addition, the Bank team is also working with a number of key agencies – including the Ministry of Trade, DG Customs, the Indonesia Port Corporation, the Ministry of Transport, and the Ministry of Finance – through other Bank instruments to continue supporting logistics reforms.

Figure 1 – Logistics Performance Index improvements and rank, 2012-2014

Coordination on PPP projects should also benefit from the establishment of the Committee for the Acceleration of the Provision of Priority Infrastructure (KKPPIP-Komite Percepatan Penyediaan Infrastruktur Prioritas) in August 2014. The Committee was established through the issuance of Presidential Regulation No. 75/2014. It is headed by the Coordinating Minister for Economic Affairs and comprises the Minister of Finance, the Bappenas Minister, and the Head of the Land Agency. The committee will focus on priority projects, provide incentives, and is allowed to recruit private consultants for project preparation works. Yet, it is too early to foresee the future effectiveness of this Committee and the sustainability of this initiative will very much depend on the implementation mechanisms that the incoming Government will retain or establish (see section on risk, below). Results of the DPL policy actions and targets24 on the operationalization of the Viability Gap Fund (VGF) are less clear. The VGF committee, at the Ministry of Finance, has been established to manage the technical, financial, and legal assessments of requests for proposals (RFP) for VGF funding. There are now at least three projects short-listed for VGF funding. These are: the Umbulan and Lampung clean water supplies, and the Medan-Kualanamu Airport railway in Sumatra. VGF funding has also been budgeted in the 2014 state budget, fulfilling part of the

24 It is noted that the target for this policy action was refined and made more specific in the second DPL and therefore this assessment is made for the target in both first and second Connectivity DPLs.

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6 5 4 3

-2 -4 -5

-16

-22-30

-20

-10

0

10

20Changes in 2012 and 2014 LPI Rankings for Indonesia

and ASEAN + China

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target in the second DPL.25 Actual approvals for the short-listed projects were not forthcoming due to the reluctance of the former Minister of Finance to the use of public budget to subsidize the private sector, especially in light of the longer term fiscal risk.26 However, the new Minister, formerly Vice Minister of Finance, is highly likely to proceed with VGF approval, considering that he was instrumental in designing the VGF scheme as Vice Minister, and has made statements to this effect soon after taking office as Minister of Finance.27 2: Strengthening Intra-island Connectivity Objective: Improved connectivity among and between growth poles, with improved regulatory framework for land acquisition for public purpose development and optimal use of resources for sustainable improvement and maintenance of island-transport network. Ratings: Substantial Linking rural areas with growth poles within an island can be constrained by inadequate road infrastructure and an underdeveloped rail network. In addition, the slow pace and uncertainties surrounding land acquisition have proven to be a significant barrier to infrastructure investments in Indonesia. Improved legal and regulatory framework for land acquisition for public projects, clear accounting guidelines for the railway sector, and improved road management practices would improve investors’ confidence in infrastructure investments, as well as improve the due diligence process and compensation standards for land acquisition, accounting standards and public financing certainty for the railway sector, and services standards for road construction and maintenance. Land acquisition law, regulations, and guidelines passed since 2012 improve the clarity of public projects. The DPL policy actions help to provide legal frameworks to address key land acquisition issues. The law provides for a more rigorous and time bound land acquisition process, fairer consultation process, and compensation procedure for the affected parties. The 2012 Presidential regulation the Head of Land Agency regulation provide more detailed guidance on how planning, preparation, implementation, and transfers related to land acquisition are to be carried out. The policy actions for the second Connectivity DPL help to further these reforms with specific guidelines on the eligibility criteria for public funding of land acquisition at both the national and local levels. In this regard, the PDO has been achieved.28 When they are effective, they would also complement the implementation of existing Bank projects. The MoF and MoHA regulations will be used, for example, for the Western Indonesia National Road Improvement Project (WINRIP) investment loan accounting for USD 300 million. Although, the impact of these reforms will only be seen from January 2015, private investment in toll road has increased in expectation of the application of the regulations.29

25 VGF has been budgeted since 2013 and the 2014 allocation was doubled from about IDR 600 billion to IDR 1.1 trillion (Ministry of Finance, 2014 State Budget). 26 Bisnis Indonesia, June 10, 2014. 27 Ministry of Finance, November 5, 2014, “Tekan Pendanaan Infrastruktur dari APBN, Pemerintah Dorong KPS / The Government is pushing for PPPs to reduce infrastructure financing from the State Budget,” http://www.kemenkeu.go.id/Berita/ tekan-pendanaan-infrastruktur-dari-apbn-pemerintah-dorong-kps 28 Again, the target for this policy action was refined, including by specifying a targeted timeline, and made more specific in the second DPL; this assessment is, therefore, made for the target in both first and second Connectivity DPLs. It is also noted that the targeted timeline of 2014 was mistakenly chosen, against the stated effective implementation date of new land acquisition projects, which would start in January 2015. 29 For example: http://www.thejakartapost.com/news/2014/10/13/astra-launch-new-toll-road-east-java.html

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http://www.kemenkeu.go.id/Berita/

The regulations will face a number of implementation challenges, including the capacity of the Land Agency to fulfill its new role as responsible to implement land acquisition, vis-à-vis its previous role as land registration agency, the uncertainty as to who should be responsible for land provision for public projects – national, local governments, or a separate land bank agency. These discussions will have an important implication in terms not only of the mechanisms of land acquisition, but also on the governance aspect of it. The decision of the incoming Government to elevate the Land Agency to an Agrarian Ministry was partly taken to strengthen the implementation of land acquisition policy. For the railway sector, the regulatory guidelines covering public service obligations (PSO), infrastructure maintenance operation (IMO), and track access charges (TAC) are already effective in 2014. The 2014 budget allocation for the state-owned railway company, PT KAI, already uses the new guidelines, as stipulated in a 2013 ministerial regulation (Minister of Transport Regulation PM.10/2013), which provides certainty as to how much the railway company would need to provide subsidized economy-class fares; with an increased PSO amount from IDR 682 trillion in 2013 to IDR 1.2 trillion in 2014, using a new formula. The initial target of establishing an accounting system can be seen as part of the guidelines. IMO, in the amount of IDR 1.7 trillion, and TAC, of IDR 1.5 trillion, payments are also proposed for the 2014 state budget. These policy actions should serve as a stepping stone for an eventual separation of PT KAI assets in a move towards a line-of-business management structure.30 But, reforms of the railway sector are proceeding slowly. Actual implementation of IMO and TAC payments still require a revision of a Government Regulation governing non-tax revenue for the Ministry of Transportation, which has been revised in November 2013, but still lacks the provisions for TAC payment.31 Meanwhile, actual disbursement of PSO budget in 2014 was also subject to negotiations between the Government and PT KAI, therefore causing uncertainty as to the pricing of economy-class ticket fares.32 Railway sector reforms will also entail not only separation of assets, but also the management of these assets and the provisions for the related commercial and public services, and competition issues. Resolving these issues will be difficult especially when PT KAI, for legacy reasons, remains the only railway firm, owner, and operator in the country. Performance-based contracts (PBC) for roads have been piloted by the Directorate General for Roads, Ministry of Public Works. The Ministry has awarded contracts for the maintenance of 120 km of roads in Central and East Java and Central Kalimantan between 2011 and 2014,33 exceeding the 50 km targeted by the Connectivity DPL.34 In addition, the Ministry of Public Works has expanded the pilot to four large urban areas – Jakarta, Semarang, Medan, and Makassar – covering 100 to 250 kilometers of roads using PBC and submitted a proposed budget

30 It is noted that the target for this policy action in the first DPL was focused on the establishment of an improved accounting system that would help the Ministry of Transportation to make informed decisions on issues such as the PSO. The second DPL refined this target to focus directly on the use of clear calculation formula to determine PSO amounts. The second DPL also added an additional target on the provisions of IMO and TAC. 31 State Auditory Board of the Republic of Indonesia, 2014, Audit Report on the Financial Report of the National Government, 28 May, 2014; Sinar Harapan, June 18, 2014. 32 Merdeka, October 1, 2014 33 Data from the Ministry of Public Works, obtained in October 2014 34 Again, the target in the first DPL, which only called for an expanded use of performance-based contract, was refined in the second DPL to specify a quantitative target of 50 km of road.

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to Parliament in August 2014.35 The PBC approach has aimed at improving the quality of roads, while increasing the value-for-money of public spending on roads. It integrates three aspects of road management – design, construction, and maintenance – and provides both incentives (by providing a long-term contract) and risk-sharing (by levying punitive charges for lack of quality) for private road contractors and operators. From the available metrics, Indonesia’s infrastructure performance is improving. This can be seen from the increase in the infrastructure scores of the LPI (see figure 2) and the Global Competitiveness Index (GCI) compiled by the World Economic Forum – in whose ranking Indonesia moved up from 78 to 61, out of 148 countries, between 2012-2013 and 2013-2014.36 It is too early to measure the impact of railway management and physical road improvements at this stage; and the scale of the reforms facilitated by the DPLs may be relatively small to warrant attribution. However, the LPI and the GCI could be used in the future to measure the indirect impact of the Connectivity DPL Series.

Figure 2 – Changes in LPI 2014 and 2012 score indicators for Indonesia

3: Improving Inter-island Connectivity Objective: Improved access, efficiencies and service performance in ICT and domestic shipping. Ratings: Modest Inter-island connectivity is crucial to achieving economic integration within an archipelago and the weak performance of Indonesian ports has led to high inter-island shipping costs. Improving port productivity can be effective to lower transport costs. Improving intra-island connectivity, outside of transport, can also be accelerated through expanding access to information and communication technology (ICT). The use of the ICT Fund would support the development of broadband ICT infrastructure in underserved areas in Indonesia. Meanwhile, port development is perceived as an important pre-requisite for improving domestic sea freight in Indonesia. The ICT policy action has been achieved, although the target of completing the tender process of the ICT Fund has not. The tendering process is on hold as an unintended

35 Ministry of Public Works, June 12, 2013. 36 The GCI ranking was brought up by the Vice Minister of Bappenas during our interview, as an indication of connectivity improvement.

3.082.872.92

2.873.21

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LPI 2012 LPI 2014

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consequence of an unrelated governance issue at the Ministry of Communications and Information. The ministry is under investigation by the Government’s audit office for the management of its Universal Service Fund, which drew payments from telecommunications firms for the development of mobile internet centers. Because of this case, the parliament has asked that major programs at the Ministry are also put on hold, including the tendering process for the ICT Fund. The revision of the ICT policy actions between the first and the second Connectivity DPL – initially aimed at operationalizing the ICT Fund, then changed to identification of remote districts to be funded by the Fund – reflected this development. In hindsight, this governance risk, even if only indirectly related to the DPL, could have been flagged in the Program Document. The team revised the relevant policy action to work around the case. However, this lowering of ambition for the policy action also reduced the impact of the proposed policy reforms. In a country both suffering from widespread corruption and with an active anti-corruption campaign, this general risk should have been apparent. Secondly, any public procurement-related policy action is also susceptible to this governance risk. Mitigation measures could have been taken, including due diligence, in-depth consultation with line ministries, and proper costing not only of procurement projects, but also of policy actions with significant public investment components. The National Port Master Plan is in place with the issuance of the Minister of Transportation Regulation No. KP414/2013. Individual port development plans have also been developed for new and existing ports, including Cilamaya, Kalibaru, Kuala Tanjung, Teluk Lamong, and Tanjung Priok expansion. The Master Plan outlines different aspects of port development, including private investment, the role of port authority, price-setting of port services, competition, vessel safety and port facilities. In addition, the Master Plan has also led to actual constructions of two port projects: a new port at Teluk Lamong in East Java and the Tanjung Priok port expansion in Jakarta. However, port development by itself may not directly improve inter-island connectivity, which might be better served by improved freight traffic, service standards, stevedoring (loading-unloading) productivity, and measures to improve economies of scale of serving remote and low-density ports in eastern Indonesia. It is noted that the Bank team is also working with the National Logistics Team on the implementation of 24/7 services in Tanjung Priok port in Jakarta. 4: Improving International Connectivity (trade facilitation) Objective: Stronger institutions and processes in handling traffic and trade volume. Key outcome indicators: Improved customs and border management in facilitating trade. Ratings: High International connectivity is a key factor for Indonesia to maximize the benefits of international trade. The purpose of a National Single Window (INSW) was to reduce the time and cost of importing and exporting by allowing single submission, single processing and single approval of import/export documents. Sustaining INSW requires proper institutional arrangements and participation from the key, relevant, government border agencies. Additionally, the single sign-on (SSO) and single submission procedures are the final goals of the INSW, which will facilitate speedier import/export clearance processes. The expansion and improvements of the Indonesia National Single Window is a key factor in improving its international connectivity. An improved INSW would help to reduce port inefficiencies, congestion, and border transactions. Currently, 18 agencies and ministries are participating in INSW, which is implemented in six ports and three airports, representing 80 percent of Indonesia’s international trade volume. While the INSW was initially developed by a

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private company, its formalization is necessary to sustain and accelerate customs and trade facilitation reforms. During the period of the DPL, the Government made a decision to upgrade the institutional status of the team in charge of coordinating the INSW, from the INSW Preparatory Team anchored at the Coordinating Ministry for Economic Affairs to an INSW Task Force under the Ministry of Finance, with a steering committee chaired by the Coordinating Minister and comprising the relevant ministers. This was subsequently done through the issuance of the Presidential Regulation No. 76/2014 in July 2014. A task force has a weaker and less permanent mandate than an agency, which was the target of the DPL. However, this task force, paired with a ministerial-level steering committee, will likely set the stage for further institutionalization and expansion of the INSW to cover more agencies/ministries and more ports and airports. Additionally, Indonesia’s actual LPI score for border management in 2014, of 2.87, exceeded the target set in the first DPL of 2.70. Ultimately, the Single Sign-On (SSO) mechanism will improve processing time for export/import licenses. This system will link individual systems of the different agencies and ministries to the INSW system. This will reduce the costs for traders and improve the efficiency of cargo clearance process. The Government has managed to link more agencies and ministries during the DPL period than was initially targeted. These are the Ministries of Trade and Health, the Plant and Animal Quarantine Agencies, the Food and Drugs Agency, and the Nuclear Power Monitoring Agency. In addition, the original target in the first DPL, a decrease of dwell time from 6.3 days in 2011 to 5 days in 2014, has been achieved. Throughout the period of the DPL, from late 2012 to late 2014, the monthly average dwell time decreased from 6.3 days in November 2012 to 5.2 days in September 2014, as shown in Figure 3 below, despite increases in freight traffic. In particular, the dwell time reduced sharply from a peak in January 2014 and if the tendency continues throughout the year, the dwell time could be further reduced. A number of factors contributed to this achievement, including closer collaboration between border agencies, pushed by the former Vice Minister of Finance; substantial increase in tariffs for container storage after they have been cleared by Customs, which induced freight companies to clear their containers faster; and elimination of pre-verification inspection for priority lane importers, which expedited movements of containers for this category of importers.

Figure 3 – Dwell time and container traffic, Jakarta International Container Terminal, 2012-2014

0.01.02.03.04.05.06.07.08.09.010.0

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TEUs days

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These reforms may have helped improve Indonesia’s logistics performance (see figures 1 and 2). Yet, there is a need to differentiate direct results and impact indicators in this pillar. Although this pillar has met all of its targets in both DPLs, it is noted that the LPI and dwell time figures could be considered as impact indicators, while the INSW agency status and SSO participating agencies could be considered as more direct results of the DPL. Any changes to INSW status and participation in the SSO would take time for them to have an impact, if any, on the decrease of dwell time and increase in LPI score. Having said that, dwell time and LPI indicators seemed to point to improved logistics improvement despite increased cargo traffic and a higher number of import permits issued by line ministries since 2011; more import permits that need to go through pre-clearance process would also increase pre-clearance time and, subsequently, longer dwell time.

3.3 Justification of Overall Outcome Rating Ratings: Moderately satisfactory The DPL supported the Government to achieve progress on important connectivity reforms. The DPL series objective is highly relevant to the Bank’s engagement program and to both the outgoing and incoming Governments’ priorities. The policy actions were relevant to achieve the objective of assisting the Government of Indonesia to strengthen the policy framework for improved national trade logistics, transportation, ICT, and trade facilitation. The overall DPL series has delivered highly relevant progress in three of the four targeted policy areas. The outcomes associated with the first sub-objective of the loan series resulted in improved coordination across different line ministries. The second and fourth sub-objectives resulted in improved regulatory frameworks for intra-island and international connectivity. Even the third sub-objective, despite the set-back on ICT reform, managed to improve the policy framework associated with maritime connectivity. In summary, the DPL series has satisfactorily supported overall connectivity reforms. At the end of this two-loan series, while there are outstanding reform agenda, the regulatory and institutional foundations for improved connectivity in Indonesia are significantly stronger in three of the four policy areas. Taking these considerations into account, the rating for the overall program outcome is Moderately satisfactory.

3.4 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development The programmatic DPL series does not have explicit targets or indicators related to poverty reduction; yet, improved connectivity can reduce poverty. Improving connectivity increases access to services and resources by reducing trade and transport costs, stimulates growth and employment, and links less developed regions with more developed regions, thus reducing poverty. To the extent that remote regions in Indonesia have higher incidence of poverty, lack of connectivity limits the opportunities of lagging regions to link themselves with their nearest growth centers. Households in remote regions are also relatively more exposed to higher risk of food insecurity as food prices tend to fluctuate more in their regions. While the Connectivity DPLs were considered to be gender neutral, improved connectivity can enhance women’s lives by providing more access to important public services, such as education, health, job opportunities and markets. A recent study using census data 1995 and 2005 (SUPAS) shows that better connectivity has increased women’s mobility to Jakarta from the Bodetabek suburban areas (Bogor, Depok, Tangerang, and Bekasi). Better connectivity provided

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better access for women to commute for educational reasons and increased the number of women commuting for work. A survey on rural women groups in Indonesia shows that women have been able to earn additional incomes through their increased access to internet through which they acquired skills in manufacturing superior products or providing services. (b) Institutional Change/Strengthening The connectivity DPLs were instrumental in convening a forum for policy dialogue between different ministries and development partners. Some of the reform areas supported by the DPLs involved several line ministries and agencies, as in the case of the adoption of the legal framework on land acquisition that involved among others the Land Agency, Ministry of Home Affairs, Ministry of Finance, among others. The DPLs contributed to strengthen the forum of policy dialogue and coordination. Yet, DPLs cannot always rush institutional change, despite strong policy relevance. Despite the achievement of the policy actions, the reform areas covered in these DPLs would need to clear additional layers of bureaucratic and legal institutions. This was the case with the delay in VGF approval, the railway sector, and the INSW organizational set up. This multiple-layer institutional set-up is not unique to Indonesia, but will reduce effective implementation of reforms. The Bank team, given this constraint, has, however, managed to balance ambition and realism. Despite the mixed outcomes and impact of the Connectivity DPL Series, it laid the foundation for further work on connectivity reforms. The DPL focused on institutional and regulatory development that would help further reforms in the future. It is noted that subsequent to the DPL, a Reimbursable Advisory Service with the Indonesian Port Corporation (Pelindo) has materialized. This direct collaboration with an SOE could also strengthen connectivity reforms in the future. (c) Other Unintended Outcomes and Impacts N/A

4. Assessment of Risk to Development Outcome Overall ratings: Substantial Despite the incoming President’s plans to focus on maritime connectivity, political risk has risen due to the minority representation of the incoming Government. This will particularly impact policy and regulatory implementation. The new Government will need to have a better implementation structure to implement current regulations and those in the pipeline – such as operationalizing the PPP-related organizations, railway charges, and port developments. In terms of strategic policy, there could be changes to the use of the MP3EI, should the incoming Government choose not to continue with it. This risk will somewhat be mitigated by the inclusion of the connectivity agenda in the Medium-Term National Development Plan. It is also expected that the new Government would need time to get a grip on its policy plans and the necessary implementation mechanisms. Implementation risk will remain an important factor, as the link between policy and regulatory changes and actual implementation is not automatic. The DPL program documents rightly pointed that bureaucratic complexity could hinder coordination and

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implementation of reform agenda. The experience of the DPL showed that this risk could have multiple layers. While senior officials were able to provide guidance and support to the DPLs, technical level officials would be reluctant to take the lead in areas in which they do not have clear authority. At the regional level, the risk of overlapping responsibilities between local and national governments could also diminish the effectiveness of connectivity reforms. Macroeconomic risks, also identified in the program documents, could also affect infrastructure-related connectivity reforms. Recently the economy has faced increased and sustained pressures to its external balances, with current account deficit growing from -2.8% of GDP in 2012 to -3.3% in 2013, and expected to moderate at -3% for 2014. A number of external factors – lower global commodity prices, slower recovery in Europe and Japan, end of the US quantitative easing –, and internal factors – the partial raw mineral export ban, lack of fiscal space for 2015 –, contribute to macroeconomic uncertainties in the medium term. These challenges are super-imposed on structural growth bottlenecks that the Connectivity DPLs sought to untangle. There is a risk that the macroeconomic and fiscal environment would not be conducive for increased investment in long-term infrastructure projects, which are important for improving connectivity. Policy Area 1: Strengthening National Coordination and Regulation (Moderate) It is likely that political and institutional risks will affect this pillar, albeit with a low impact on its development outcome. It is noted that the president-elect will prioritize on-the-ground results and will demand his ministers to deliver quickly. The way the incoming Government structures its responses to connectivity issues will also affect delivery of results. At this point, indications of new ministries related to connectivity issues – including an agrarian ministry and a maritime ministry – could elevate the issue and expedite reforms. On the other hand, the plan to abolish most vice-ministerial positions will put heavy policy and implementation burdens on the ministers and could slow down reforms. The implementation of the VGF might also face challenges in the context of limited fiscal space, as well as within a political environment that may not favor the perception of public support for the private sector. While institutional risks could hamper the implementation of this pillar, the policy focus of the new Government on connectivity makes it unlikely that there would be major reversals. Policy Area 2: Strengthening Intra-island Connectivity (Substantial) This pillar faces a high likelihood of bureaucratic and regulatory complexities and medium likelihood of governance risk; should the latter take place, it will have a high impact on the pillar’s development outcome. For example, despite the relative clarity of the new Land Law and its implementation regulations, it still takes a maximum of 500 days to finalize land acquisitions. Land acquisitions will also face different capacity issues with local governments. Railway reforms are already facing another layer of regulatory hurdle, in the form of a revision to a Presidential Regulation necessary for IMO and TAC changes to take place. In addition, as was the case with the ICT Fund, governance risk to public procurements – which affect land acquisition and road performance-based contracts – is also significant and could delay implementation of reforms. Policy Area 3: Improving Inter-island Connectivity (Substantial) This pillar faces a moderate likelihood and high impact possibility of governance, implementation, and economic risks. As mentioned above, the ICT Fund tendering process has been delayed due to an unrelated corruption charges at the Ministry of Communication and

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Information. While, the National Port Master Plan has been issued and implemented, it remains susceptible to the availability of public and private financing. Policy Area 4: Improving International Connectivity (trade facilitation) (Moderate) This pillar faces a low likelihood and a substantial impact possibility of implementation risk. The INSW enjoys strong buy-in from the participating ministries and from the private sector. Indonesia’s regional commitment on this, as part of the ASEAN Single Window, also put this reform on a strong foundation. While further progress on INSW and the SSO mechanism would depend on each ministry’s timeline, they are unlikely to be reversed. Yet, trade facilitation not only involves establishing the INSW but also streamlining trade related regulations to facilitate more efficient trade. In the past, the Ministry of Trade issued measures that have had an impact on the overall border management (pre-departure inspection, more restrictive import licensing regime for several products). However, this trend was reversed in 2014 and the new Government is likely to reduce trade-related licenses further.37

5. Assessment of Bank and Borrower Performance

5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Ratings: Moderately satisfactory The DPL series was underpinned by strong analytical work, ongoing technical assistance, and continuous policy dialogue led by staff based on the field. It drew on recent analytical works published by the Bank since 2009. These include: WDR 2009 on Reshaping Economic Geography; Connecting Indonesia: A Framework for Action (2010); Indonesia’s Logistics Performance Index 2012, Infrastructure Public Expenditure Reviews on the rail (2011) and roads (2012) sectors, and State of Logistics Indonesia, 2013. The policy loans were delivered in a timely manner at the request of the Government for financing. Senior Bank staff responded quickly to the Government’s initial requests for development loan, followed by engagement at the technical level across the Bank office and with the relevant implementing ministries/agencies. The workload was well-coordinated within the Bank’s multi-sectoral team. However, although the design of the DPL Series followed the relevant analytical framework, the results lacked coherence and linkage to overall impact. This was partly due to the complexity of connectivity issues themselves, but also to contextual constraints in the form of the political transition happening at the end of the DPL Series. Many of these challenges were identified during the review of the Program Document and the team took the available measures to minimize these risks, for example by also using other Bank instruments to leverage buy-in from the Government. (b) Quality of Supervision

37 Liputan 6, September 23, 2014, “Jokowi Ingin Persingkat Waktu Tunggu Kapal di Pelabuhan / Jokowi wants to reduce dwell time at ports,” http://news.liputan6.com/read/2109315/jokowi-ingin-persingkat-waktu-tunggu-kapal-di-pelabuhan

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Ratings: Moderately satisfactory Given the structure of the DPL, all policy actions were fulfilled prior to loan disbursal. Hence, the supervision of the DPL mainly took place during policy dialogues for the DPL preparation. The preparation for the second DPLs also entailed continuous dialogues with the Government and as follow-up on policy actions. With team members in the field, monitoring of progress towards outcome indicators was done on a relatively continuous basis. The process was coordinated by Bappenas. The Bank could have explained better the mechanics of the DPL to senior and mid-level officials of implementing agencies and ministries involved in the DPL, through a seminar for instance, and could have presented experiences from other countries and sectors. As the DPL covered a wide range of reforms where many line ministries and agencies were involved, a government official reported that not all technical officials from other ministries other than the main counterparts understood the DPL mechanism. (c) Justification of Rating for Overall Bank Performance Ratings: Moderately satisfactory The Bank’s performance contributed to the sense of government ownership and commitment to the implementation of the reform program. The DPL series was delivered timely. Effective dialogues, with the participation of ADB, were maintained with the Government throughout the series, which strengthened ownership of the program. Although it was a joint operation with ADB, the Bank maintained a separate set of prior actions that were more focused. Key counterparts at Bappenas and the Coordinating Ministry for Economic Affairs facilitated communication with other parties involved (Ministry of Finance, Land Agency, Ministry of Home Affairs, Ministry of Public Works, Ministry of Communication and Information, and Ministry of Transportation). Lead Government counterpart facilitated follow-up meetings with other units and agencies on the status of policy actions. Bank’s staff involved has strong technical capacity to both deliver the results and manage the engagement with the Government and co-financiers.

5.2 Borrower Performance (a) Government Performance Ratings: Moderately satisfactory Bappenas was responsible for the coordination of the Connectivity DPL series. This was a natural extension of the role of the Vice Minister of Bappenas as Chair of the Connectivity pillar of MP3EI. The Vice Minister played an active role, convening senior officials when necessary, and delegating the more technical coordination to the Director General for Infrastructure and Director for PPP Development. This ensured high-level buy-in and facilitated communications across the line ministries. Bappenas also played as an active conduit between the Ministry of Finance and the Bank, especially in identifying the opportunity for a DPL to fill a part of the fiscal need. However, given that Bappenas lacks the authority to oversee other line ministries38, it was perceived that it could have played a stronger leadership role.

38 It is noted that in the new Government, Bappenas’ role is elevated to be part of an expanded Office of the President, directly answering to the President. It is not yet clear, however, whether this will also mean a power to convene line ministries.

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Another important Government counterpart was the Coordinating Ministry for Economic Affairs. The CMEA has played an active role in past DPLs and is familiar with the use of the DPLs. It also has the mandate to convene other economic ministries. It is responsible for key aspects of the connectivity agenda, including logistics, infrastructure, and regional development. Future DPLs with cross-cutting policy issues could explore the use of two strong counterparts such as the CMEA and Bappenas, or the CMEA/Bappenas and another line ministry. This would strengthen coordination and oversight across different levels of officials. (b) Implementing Agency or Agencies Performance Ratings: Moderately unsatisfactory As with other DPLs, the experience with implementing agencies/ministries was varied, very much dependent on their understanding and perception of the uses of the DPLs. The set of policy actions was completed on time. The DPLs were more acceptable to ministries with which the Bank has a program, but many still perceived the policy actions as an added burden without a commensurate increase in their budgetary resources. This was even the case with the Ministry of Finance, who came to Bappenas initially to sound out the possibility of an alternate source of financing. Not all implementing agencies were able or will be able to meet deadlines of policy targets. As a planning agency, Bappenas had no effective authority over the implementing ministries/agencies and was unable to force line ministries to meet the deadlines of the policy targets. Moreover, as mentioned before, there was a lack of understanding of the mechanism of the DPL at the technical level of some of the implementing ministries. The Bank would need to improve its socialization of the use of DPLs as a drive for regulatory reforms that the ministries themselves are trying to complete. It could also explore, with the Ministry of Finance, the possibility of a fungible increase of resources for the line ministries, as a portion of the DPL amount. (c) Justification of Rating for Overall Borrower Performance Ratings: Moderately satisfactory The Government’s ownership of the program and its commitment to the overarching agenda of connectivity form the basis for this rating. Yet, the gap between senior level buy-in and the lack of understanding of the DPL at the technical level, as well as between the key counterpart ministries (Bappenas and CMEA) and the line ministries could have been closed further. This is not a reflection of the performance or the level of effort of Bappenas, but this shows the need for improved Bank engagement in terms of socializing the value-added of DPLs, as well as its relatively low cost of financing.

6. Lessons Learned The Bank needs to strike a balance between DPLs supporting reform in narrow areas with narrower outcomes but less risk, versus a widely cross-cutting DPLs supporting reform in broader areas that is riskier but often could have more development impact. One logical path is to go with the option that maximizes the positive outcome with the minimum risk, which is rarely available. If the aim is about transformative changes, then risk-taking should be more encouraged. This operation is about complex regulatory and institutional issues related to a complex area of reform: connectivity in Indonesia. Perhaps a narrower DPL focusing on fewer aspects could have led to higher ratings, but what was expected to be achieved would have been less transformative.

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A cross-cutting DPL does not automatically translate into improved coordination within the implementing ministries. The gap of understanding between the senior Government officials familiar with the DPL mechanism and the technical staff at line ministries in this particular case contributed to this. A suggested approach would be for the Government to focus on policy actions themselves and structure the coordination meetings around their relation to the strategic-level Government connectivity agenda. Complementing Bank instruments, such as TAs, could be used for an effective implementation of widely cross-cutting DPL. The cross-cutting nature and the lack of focus of the Connectivity DPL made it difficult to use complementing existing Bank instruments to improve its effectiveness. The available TAs and loans on trade competitiveness, ICT reforms, road development, and PPP institutions, were modular enough to support the respective DPL pillars; but in the end they may have lacked concentrated fire power. ADB’s experience, of using one dedicated TA to complement its Connectivity DPL series, could be considered. Having more than one strong counterpart is a suitable arrangement for cross-cutting DPLs involving several ministries and agencies. It is key that the counterpart champions policy reforms, as in the case of Bappenas that had a high-level representative, whereas some of the other agencies were represented by echelons 3 or below. Yet, if its capacity to convene, coordinate and oversee a big number of ministries and agencies is deemed weak, the use of a second strong counterpart, such as CMEA, could strengthen the coordination and oversight across different levels of officials and entities. Electoral cycles may have an impact on the momentum of reforms and it is important to consider the potential bureaucratic obstacles to reforms that appear especially during the pre-election period. The implementation of the second phase of the DPL coincided with pre-election period; both the team and management were aware of the political and implementation risks associated with the election and the transition of governments and took them into consideration. Nevertheless, the team could have been more realistic about the potential bureaucratic obstacles during implementation, especially those relating to additional layers of bureaucratic, administrative, and legal issues. In a middle-income country without problems to access financial markets, a DPL should be seen as one instrument, among others, to improve the chances of long-term, structural, reforms. The changes a DPL try to encourage in middle-income countries like Indonesia do not relate to the availability of funding; but, rather to assist in the institutional development – coordination, regulatory reforms, and governance – of complex issues such as connectivity. The policy focus of a DPL should be highlighted and used as vehicles for structural reforms by the Government. At the same time, despite the challenges faced by a DPL series, it could position the Bank to deliver a medium-term agenda that is relevant to the Government. The new incoming Government, for example, made connectivity, especially maritime connectivity, a major part of its economic agenda and the establishment of a Coordinating Ministry for Maritime Affairs reflects this priority. The experience of working with Bappenas could also improve the reform agenda in the future as the President has chosen to elevate the role of Bappenas in the Cabinet to be part of an expanded Office of the President. In light of the experience of the first two Connectivity DPLs, a number of factors would need to be considered (see Section 6 for further elaboration). First, programmatic focus would need to be revisited – whether or not to package the loan into more focused DPLs with a larger set of policy actions. A more concentrated program would enable the Bank and the Government

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to deliver policy reforms in more depth and improve the chances of success in a few number of policy areas – i.e. separate logistics, transportation, infrastructure, and ICT programs. However, as mentioned above, this is a question of balance. A more concentrated focus would have a higher likelihood of success, but at the price of a less transformative and less ambitious program. The sequencing of reforms would also need to be taken into consideration for programmatic design. A more immediate need for institutional development – rules, regulations, ministerial coordination – may necessitate a higher level of ambition with higher risks and a lower likelihood of success, but would contribute to building the foundations for longer term successes in key connectivity sectors. Second, a more strategic use of complementary Bank instruments, such as a parallel technical assistance, could improve coordination and implementation of policy actions. Finally, lack of technical-level understanding on the part of the implementing ministries/agencies suggests that the Bank team would need to improve its socialization of the uses of the DPL itself to improve the understanding of line ministries.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/Implementing agencies The Bank appreciates the comments provided by the Vice Minister of National Development Planning, the Director for PPP Development, Ministry of National Development Planning, and the Expert Staff to the Coordinating Minister for Economic Affairs on Regional Development on this ICR Report. (b) Cofinanciers The Bank appreciates the comments provided by the Deputy Country Director/Senior Country Economist, ADB Indonesia Resident Mission, on this ICR Report. (c) Other partners and stakeholders N/A

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Annex 1. Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members P124006 & P144774 - Connectivity Development Policy Loan 1 and 2

Names Title Unit Responsibility/ Specialty

Lending Amilia Aldian Transport Engineer GTIDR Road and rail transport Natasha Beschorner Senior ICT Policy Specialist GTIDR ICT connectivity Dara Lengkong Consultant GFMDR Finance and lending Sjamsu Rahardja Sr Trade Econ. GTCDR TTL and INSW Henry Sandee Senior Trade Specialist GTCDR Ports and INSW Kalpana Seethepalli Senior Economist GCPDR PPP and VGF Andri Wibisono Infrastructure Specialist GTIDR PPP and VGF Supervision/ICR Sjamsu Rahardja Sr Trade Econ. GTCDR TTL Alberto Portugal Perez Sr. Trade Econ. GTCDR Lead ICR Author Brasukra Gumilang Sudjana Econ. GTCDR ICR Author

(b) Staff expenses FY 2013 P124006; Source of Funding: BB – Fund

Vendor Name Unit Expense in USD Ms Natasha Beschorner GTIDR 4,073.84 Mr Amilia Aldian GTIDR 2,070.90 Mr James A. Brumby GGODR 6,258.72 Mr Mustapha Benmaamar GTIDR 6,411.21 Mr Andri Wibisono GTIDR 71.02 Ms Kalpana Seethepalli GCPDR 641.34 Mr Sjamsu Rahardja GTCDR 27,591.20 Mr Timothy H. Brown GENDR 6,498.50 Mr Shubham Chaudhuri GPVDR 1,210.24 Total 54,826.97 P144774; Source of Funding: BB - Fund

Vendor Name Unit Expense in USD Mr Amilia Aldian GTIDR 882.05 Mr Mustapha Benmaamar GTIDR 1,508.52 Mr Alexis R. Sienaert GMFDR 524.16 Mr Sjamsu Rahardja GTCDR 12,179.54 Ms Elisabeth Goller GTIDR 217.32 Total 15,311.59 FY 2014 P124006; Source of Funding: BB – Fund

Vendor Name Unit Expense in USD Mr James A. Brumby GGODR 2,048.10 Total 2,048.10 P144774; Source of Funding: BB - Fund

Vendor Name Unit Expense in USD Mr Amilia Aldian GTIDR 1,840.80

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Mr Henry Sandee GTCDR 26,233.20 Mr Andri Wibisono GTIDR 4,298.18 Ms Kalpana Seethepalli GCPDR 19,327.02 Mr Sjamsu Rahardja GTCDR 20,190.76 Total 71,889.96

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Annex 2. List of People Interviewed • Amilia Aldian, Transport Specialist • Natasha Beschorner, Senior ICT Policy Specialist • Ndiame Diop, Lead Economist • Edimon Ginting, Deputy Country Director/Senior Country Economist, ADB Resident

Mission, Jakarta • Bastary Pandji Indra, Director for PPP, Bappenas • Dara Lengkong, Consultant • Sjamsu Rahardja, Senior Trade Economist, TTL • Henry Sandee, Senior Trade Specialist • Lukita Tuwo, Vice Minister of Development Planning/Bappenas • Wahyu Utomo, Expert Staff to the Minister for Regional Development, Coordinating

Ministry for Economic Affairs • Andri Wibisono, Infrastructure Specialist

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Annex 3. Borrower’s Comments on Draft ICR On October 2, 2014, the ICR team met with the Vice Minister of National Development Planning, the Director for PPP Development, Ministry of National Development Planning, and the Expert Staff to the Coordinating Minister for Economic Affairs on Regional Development, to discuss key outlines of the ICR and to seek comments. The officials suggested the following key points to be highlighted in the ICR.

1. Government commitment to the connectivity agenda remains strong. This is reflected in the establishment of the Committee for the Acceleration of the Provision of Priority Infrastructure (KKPPIP-Komite Percepatan Penyediaan Infrastruktur Prioritas). The revamped KKPPIP will ensure clear policy direction and implementation as it will be responsible to channel public infrastructure projects according to the relevant funding mechanisms – through SOEs, PPPs, or state budget. It is also noted that connectivity is also a priority for the incoming Government.

2. The DPL may benefit from an impact evaluation, for example, one year after its completion. This would be useful to measure the implementation effectiveness of regulatory changes and policy actions, some of which would not be effective several months after the completion of the DPL.

3. Should a follow-up DPL be considered, it could comprise the following items: • Inter-island connectivity, especially sea transport. This could include investment

regulations, business environment and sea freight. • PPP and financial schemes for infrastructure. This could include regulatory

reforms on PPP schemes and the consolidation of the Government’s PPP financing firm (PT Sarana Multi Infrastruktur) and the Ministry of Finance’s Government Investment Center (Pusat Investasi Pemerintah – PIP).

• Customs-related reforms, especially the development of Special Economic Zones (SEZs). The development of eight SEZs in Indonesia would require improved connectivity.

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Annex 4. Comments of Cofinanciers and Other Partners/Stakeholders The ICR team met Edimon Ginting, Deputy Country Director/Senior Country Economist, ADB Indonesia Resident Mission, Jakarta, on 30 September 2014. Mr. Ginting agreed that Government ownership was strong and connectivity remains a strong policy issue. This is reflected in the way that Government’s policy actions are stronger in the ADB Connectivity DPL than ADB’s other DPLs. Mr. Ginting also believed that coordination among the line ministries was also strong. Bappenas was effective in coordinating the line ministries at different levels. Policy coordination was led by a Director General, while technical meetings on policy actions were led by a Director. The Bappenas Director General for Infrastructure was singled out as very effective in unlocking bottlenecks and providing advice and direction. The relevant Government officials also understand that the loan was for budget support and would deliver the policy actions that are most important to them. Mr. Ginting underlined the need to see the DPL policy actions as the Government’s own reform program. In terms of future possible work on connectivity, Mr. Ginting saw that the new Government will maintain a focus on connectivity, logistics, and infrastructure. There are risks in terms of big regulatory changes that require parliamentary support, which is lacking for the incoming Government. But, the Government could still undertake technical reforms and implement existing regulations. Future DPLs could support some of these implementation reforms.

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Annex 5. Development Partners’ Financing Parallel development partners’ financing were extended to the Government of Indonesia by the Asian Development Bank (ADB), the Japan International Cooperation Agency (JICA), and l’Agence Française de Développement (AFD). Asian Development Bank Project title : Inclusive Growth through Improved Connectivity Program –

Subprogram 1 and Technical Assistance Grant Financing amount : USD 301 million (USD 300 million of loan and USD 1 million capacity

development TA) Signing date : 23 November 2012 Closing date : 31 March 2013 Project title : Inclusive Growth through Improved Connectivity Program –

Subprogram 2 Financing amount : USD 400 million Signing date : 29 November 2013 Closing date : 31 March 2014 Japan International Cooperation Agency Project title : Connectivity Development Policy Loan Financing amount : JPY 19.848 billion / USD 200 million Signing date : 2 December 2013 Closing date : 18 December 2016 Agence Française de Développement Project title : Connectivity Development Program Loan 2 Financing amount : EUR 74.7 million / USD 100 million Signing date : 12 December 2013 Closing date : 31 March 2014

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Annex 6. List of Supporting Documents Program Document, Connectivity Development Policy Loan, October 18, 2012, Report No. 72881-ID Program Document, Second Connectivity Development Policy Loan, November 19, 2013, Report No. 76870-ID Country Partnership Strategy Progress Report for Indonesia FY2009-2012 Country Partnership Strategy for Indonesia FY2013-2015 Logistics Performance Index 2012 and 2014 ADB, Programmatic Approach, Policy-Based Loan for Subprogram 1, and Technical Assistance Grant: Inclusive Growth through Improved Connectivity Program, Project No. 46093-001 ADB, Policy-Based Loan for Subprogram 2: Inclusive Growth through Improved Connectivity Program, Project No. 46093

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MAP

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Document of The World Bank Kerja Presiden Bidang Pengawasan dan Pengendalian Pembangunan...

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