SEMARANG, Indonesia: When the first phase of the Kendal Industrial Park in Central Java, a joint Indonesian-Singaporean project, is complete by 2021, about 100,000 employment opportunities will be created, Sembcorp Development CEO Kelvin Teo told Channel NewsAsia on Sunday (Nov 13).
The park, which is also known as Park by the Bay, is a joint venture between Indonesia’s industrial estate developer PT Jababeka and Singapore’s Sembcorp Development. It will be officially opened by Prime Minister Lee Hsien Loong and President Joko Widodo on Monday, one of the highlights of the leaders’ retreat in Semarang.
Speaking on the sidelines of a press conference held by Indonesia’s Industry Minister Airlangga Hartarto ahead of the official opening, Mr Teo said 20 companies from Singapore, Indonesia, Japan and Australia have committed to invest in the park. The companies will invest a total of IDR4.3 trillion (S$450 million) and initially some 4,000 jobs will be created.
“Kendal Industrial Park is set to form the economic engine and create jobs in the region. We support Indonesia’s plan to grow Java and accelerate the growth of Central Java,” said Mr Teo, adding that the project will also enhance bilateral trade and relations between Singapore and Indonesia.
“The industrial park serves as a platform whereby Singapore can share our experience from industrialisation and export our expertise to help the region create jobs.”
The 2,700-hectare park is expected to attract manufacturing companies in industries such as furniture, food processing, building materials and textiles.
The development will be carried out in three phases. Phase one will involve developing 860 hectares over the next five years. Residential housing and facilities such as shopping centres, a golf course and a driving range are also in the pipeline.
To ensure there are sufficient workers to work in the industrial park, there will be vocational training for the furniture industry in Java, said Mr Hartarto.
“The (Indonesian) government’s priority is to focus on the industrial sector,” he said. “When they graduate from the school, hopefully they can work in the industrial area.”
The industry minister also said that he hopes that the industrial park can take off, similar to those in Batam and Bintan.
From right: Sembcorp CEO Kelvin Teo, Governor of Central Java Mr Ganjar Pranowo, Minister for Industry Mr Airlangga Hartarto, Minister for Foreign Affairs Mrs Retno Marsudi, CEO of Jababeka Mr Budianto Liman, Chairman of Jababeka Mr SD Darmono. (Photo: Lim Jia Qi)
Located between Jakarta and Surabaya – two of Indonesia’s largest domestic markets – Kendal Industrial Park is about 20km from Tanjung Emas Port in Semarang, the only port serving Central Java.
With that, Mr Teo hopes that the park will serve as an alternative manufacturing location for companies who wish to invest in Indonesia.
“The labour cost in Semarang is about half of Jakarta’s. The land cost is about one third. So we have the cost advantage to set up operations here,” he said.
