Abstract
The government often faces budget constraints and financial gaps between necessity and real allocation funds. It makes them must be more selective when prioritizing infrastructure development. Moreover, providing adequate transport infrastructure and sustainability is crucial for the government. Government must innovate by creating a conducive investment climate to encourage the participation of private and state-owned enterprises in infrastructure financing. Innovation financing through Private Funding and PPP schemes is directed to infrastructure with high economic and financial feasibility. PPP schemes in the air transportation sector particularly in Indonesia have not been successfully implemented until 2018. Therefore, the government has initiated several PPP projects as pilot projects to encourage PPP implementation in the Transportation Sector. One of them is Labuan Bajo International Airport. Labuan Bajo Airport is in West Manggarai Regency as a gateway to enter the Komodo Island area. Labuan Bajo airport is one key infrastructure that supports The Big 5 Super Priority Destinations of Indonesia by the Indonesia Ministry of Tourism and Creative Economy. This paper aims to examine critical success factors and interfere factors of the PPP pilot project for Labuan Bajo Airport. This paper uses an exploratory descriptive method to examine every factor that supports the success of the PPP implementation process in the air transportation sector based on qualitative data. The study will also explore the planning process through analysis of PPP Book documents from 2010-2020 (content analysis) to historically examine the process of proposing PPP project activities and examine the factors that support the success or delay the PPP pilot project within the Ministry of Transportation based on stakeholder approach. The planning and preparation stage plays a critical role in efforts to prepare comprehensive, reliable, and feasible projects. The feasible project can minimize project uncertainty and gain attract private sector investment.
Highlights
The inevitable infrastructure development challenge is government budget constraints
Based on the description analysis, here is several important conclusions were obtained as follows: 1) Private Partnership (PPP) can be a financing solution through the arrangement of the private sector to join in the sharing of authority, responsibility, resources, risks, and benefits from the provision of public services and infrastructure (Hodge & Greve, 2007; Grimsey & Lewis, 2004)
2) Based on the historical study of the PPP Book 2010-2020, it is known that the PPP project proposal process in the 2010-2018 period was less supported by the government policy and experienced human resources who prepare PPP projects so the readiness criteria of PPP supporting documents could not be fulfilled in short term
Summary
The inevitable infrastructure development challenge is government budget constraints. Development funding was handled by conventional funding (government budget/APBN) but currently facing budget constraints made the paradigm shift through opening up opportunities for private involvement in developing and developed countries (Ng et al, 2012). Based on the National Medium-Term Development Plan (RPJMN), this shift is believed to accelerate the provision of infrastructure and increase economic growth in the medium and long term. Based on the 20202024 National Medium-Term Development Plan (RPJMN), there are three (3) funding schemes : 1) Private Funding and PPP schemes for projects that have high economic and financial feasibility (high value of IRR), 2) National Corporate funding for project that has high economic feasibility but still financially marginal, and PENA TEKNIK: Jurnal Ilmiah Ilmu-Ilmu Teknik Vol 7, No 1, Maret 2022 p-ISSN 2656-7288, e-ISSN 2656-7334
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
