Aceh teams up with Irish firm to develop Sabang port

Andi Haswidi, The Jakarta Post, Banda Aceh

The Sabang Free Trade Zone Management Board (BPKS) in Aceh province will team up with Ireland's Dublin Port Company (DPC) to develop Sabang into a world-class port at a cost of some Rp 4 trillion (about US$445 million).

BPKS deputy president Nasruddin Daud said Tuesday in Aceh's capital, Banda Aceh, that the two bodies would set up a joint venture company, to be called PT Sabang Hub International Port, in June to develop the port.

The construction of the port, which is expected to begin soon after the establishment of the joint venture company, is scheduled for completion in five years.

Sabang is an island located at the most western tip of the archipelago within the boundaries of Aceh province.

"The total investment, which it is estimated will come to about Rp 4 trillion, will be shared fifty-fifty between Dublin Port and us," he said. "Right now, we are still at the pre-qualification stage for consultants to design the port," he explained.

Nasruddin said that the contract between the BPKS and DPC, which would be signed in June, would run for 50 years.

After the long conflict in Aceh ended following the tsunami disaster in 2004, both the central and provincial governments have agreed to afford Sabang special treatment as the island is believed to have the potential to serve as an import-export hub.

Sabang will now be developed as a free-trade zone, a status that it also held back in the 1960s, and will have the capacity to accommodate ocean-going vessels.

Financing for the development of the port, Nasruddin said, would come from the central government, but would be separate from the funds allocated to the province for reconstruction work, which, in Sabang's case, was being funded by the BRR, provincial government and central government.

"We received Rp 100 billion out of last year's national budget, and Rp 195 billion from this year's budget. In addition, we received Rp 3 billion from the provincial budget in 2006, and will receive another Rp 1.5 billion this year," he said.

"As for the BRR, this year they are going to spend Rp 45 billion on rehabilitating local infrastructure, including the water purification plant and water mains," he said.

Speaking to The Jakarta Post earlier, the director of the Aceh Provincial Investment Coordinating Board, Teuku Zainal Arifin Panglima Polem, said that a "world-class resort" would also be built on Sabang.

"Sabang is an excellent place for eco tourism with its beautiful beaches. It's also the perfect spot for divers. We plan to develop the island as an exclusive resort so as to attract big-spending tourists," he said.

According to a recent BKPS report, some 70 to 80 foreign tourists visit Sabang every weekend, with many of them being NGO officers working in Aceh. Tourists also come from German and other parts of Europe for the excellent diving around the island.