Official Opening of Kendal Industrial Park
Prime Minister Lee Hsien Loong of Singapore and President Joko Widodo of Indonesia presided earlier this week on November 14th over the official opening of Kendal Industrial Estate, Park by the Bay, a new 2,700-hectare integrated township in Kendal, Semarang, Central Java, by PT Jababeka Tbk and Sembcorp Development, a wholly-owned subsidiary of Sembcorp Industries. The project is set to form the economic engine to draw investment and create jobs for a region which Indonesia has earmarked for greater development. At the same time, it will serve as an emblem of private sector economic cooperation between Indonesia and Singapore.
The first integrated township of its kind in Central Java, Park by the Bay is a coastal development located along the Jakarta-Semarang-Surabaya Economic Corridor, which includes industrial, commercial as well as residential space to be developed over several phases. Land and infrastructure development have commenced for the project’s 860-hectare first phase.
During the opening ceremony, the master plan for Park by the Bay was unveiled. This features themed industrial clusters, including a Fashion City, Food City, Furniture Hub and Building Materials Zone. Each cluster will target companies involved in various stages of the value chain, from processing of raw materials to design, manufacture and marketing of finished products, and will also be able to host trade shows and retail activities. In addition, Park by the Bay will have commercial amenities and residential space aimed at creating a conducive environment to live, work and play. These are set to transform the site into a self-sufficient, modern city.
So far, the project has been receiving an encouraging level of interest with 20 companies have indicated interest to set up manufacturing operations at Park by the Bay. A total of 32 hectares on the site have been set aside for these companies, who will bring with them IDR 4.3 trillion (US$330 million) in investments and create some 4,000 jobs at the start. Of these companies, Singapore furniture manufacturer, Tat Wai Industries, has already commenced operations atPark by the Bay, and nine others are set to begin construction on the site for their factories this year.
Park by the Bay supports Indonesia’s goal to accelerate the development of Central Java. Compared to Greater Jakarta, which hosts 65% of the country’s industrial activity, at present just 5% of Indonesia’s industries are located in Java’s central region. Given the clear potential for growth, President Joko Widodo’s administration has earmarked the Semarang Kendal-Demak area, where Park by the Bay is located, as a national strategic industrial zone, and has commenced a number of major infrastructure improvements to benefit it. These include upgrading Central Java’s Ahmad Yani International Airport and the Pantura Highway that connects Central Java to Jakarta, installing a double-track railway line connecting Jakarta, Kendal and Surabaya, and announcing a natural gas pipeline that will run from Cirebon, in West Java, to Semarang by 2020. In addition, Indonesia’s Investment Coordination Board (BKPM) has implemented an accelerated service to issue investment licences within three hoursof submission.
Park by the Bay brings together two of Asia’s largest integrated township developers, PT Jababeka Tbk and Sembcorp Development, in a 51-49 percent joint venture. Jababeka is the developer behind the 5,600-hectare Kota Jababeka development in Cikarang, Bekasi West Java and the 1,500-hectare Tanjung Lesung development in Banten, while Sembcorp Development pioneered the development of Batamindo Industrial Park in the Riau Islands, and has since built up a portfolio of integrated townships and urban developments in Asia spanning more than 10,000 hectares.