Lombok Lovers

Lombok's Friendliest Forum has a new home!
 
HomeGalleryFAQRegisterLog in

Share | 
 

 Emaar Withdraws From US$600 Million Lombok Project

View previous topic View next topic Go down 
AuthorMessage
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Emaar Withdraws From US$600 Million Lombok Project   Sun Mar 15, 2009 10:39 pm

Bureaucratic Delays and Venal Officials Blamed for Demise of Transformational Tourism Project for Lombok Island.


(3/14/2009) The Jakarta Globe reports that a massive US$600 Million mega-resort planned for South Lombok is now in jeopardy.

The project of shopping, recreation areas, golf courses and luxurious hotels on a 1,200 hectare site is a "pet project" of Indonesia's Vice President, Jusuf Kalla, who personally invited Dubai's state-owned Emaar Properties to spearhead the investment.

Citing bureaucratic delays and an inability by the government to fulfill its obligations, Emaar announced that thy have closed their Jakarta office and are abandoning it plans for investing in Indonesia. Elly Savitri, a representative of Emaar said. "there have been too many delays on the realization of the project and the company just could not wait any more."

Jakarta Globe coverage suggests that greed on the part of government officials seeking hand-outs may have also played a role in a decision to cancel the project. Meanwhile, others suggest that the worsening global financial crisis may have adversely affected the liquidity of Emaar and diminished their keenness to pursue the Lombok investment.

Lombok is almost certain to be sent reeling by Emaar's decision to quit the project, seen as the catalyst for planned new roads and a new international airport in Lombok. The final project was targeted to host 10,000 luxury villas, eight hotels and two 18-hole golf courses.

Emaar told the press that they have already expended US$4.2 million in consultancy fees in connection with the Lombok project.

Jusuf Kalla's plans to woo Middle Eastern investors appears to be in serious strife. The withdrawal of Emaar from the US$600 million Lombok Project follows the recent pull out of the Saudi Arabian Bin Laden Group from a US$4.3 billion agricultural project planned for Papua.

Vice President Kalla has reportedly convened a special meeting of cabinet ministers in a last ditch effort to salvage the prestigious Lombok project.


© Bali Discovery Tours. Articles may be quoted and reproduced if attributed to http://www.balidiscovery.com. All images and graphics are copyright protected.



http://www.balidiscovery.com/messages/message.asp?Id=5120
Back to top Go down
View user profile http://www.mimpimanis.com
outahere
Lombok Looney


Number of posts : 415
Location : nowhere
Registration date : 2008-07-02

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Mon Mar 16, 2009 8:55 am

I can't say I'm surprised at this news. There were so many hurdles to overcome, Indonesian beaurocracy being just part of it. The area should be world heritage listed, not developed as a tourist resort for rich Arabs.

I was never convinced that this project would be good for the local people, in fact I am pretty certain that it would ruin the local culture as it is. I bet that while the millionaires lived in luxury sucking up all the resources, the locals would still be living in dirt floor huts with no water or electricity, with children sick from malnutrition and malaria.

Did Emaar ever buy the land they needed?
Back to top Go down
View user profile
Josi
Lombok Soulmate
avatar

Number of posts : 200
Location : USA
Registration date : 2008-08-05

PostSubject: Did Emaar buy the land?   Mon Mar 16, 2009 11:33 am

I don't believe they did. I believe their initial investment of more than $4 million is the seed money for the Indonesian government to demonstrate through a plan how the infrastructure will be developed. I interpreted this to mean delivery of the required land, in other words, it is the Government who will shoulder the burden for land acquisition.

Sometime back I came across a research paper by a student of an Australian university touting the Holiday Inn (now Resort) land acquisiton as a model. Even then, there were difficulties but they were managed well to the mutual satisfaction of the sellers and buyer.

In the final analysis, the motivation for development has to come from within Indonesia. Mainland China uses central control for infrastructure development. One advantage for foreign investment is they have to deal with one entity. In the case of Emaar it seems like the governmental authority is so fragmented.

It was never clear how the power and water needs will be met. Were they going to build a dam to cath the rain water and feed it to the development? Were they going to produce power through fossil fuel?

Does this mean I can continue to land in Selaparang airport Cool
Back to top Go down
View user profile http://www.sarojini.org
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Mon Mar 16, 2009 12:21 pm

Emaar: Just the Start?

(From Jakarta Globe)

The announcement that Dubai’s state-owned Emaar Properties PJSC has pulled the plug on a $600 million property project on Lombok Island may be a signal of worse to come, business players and analysts said on Sunday .

It has, however, also emerged that Emaar is facing serious financial difficulties at home and is hurriedly canceling projects around the globe.

Speaking on Sunday about Emaar’s allegations of government ineptitude, Purbaya Yudi Sadewa of the state-owned Danareksa Research Institute said: “It’s a signal for foreign investors to be very cautious about investing here. It will make people more reluctant to press ahead with their projects, and maybe even convince some to pull out.”

Emaar canceled the joint venture with state-owned Bali Tourism Development Corp. after it claimed the government appeared incapable of fulfilling a number of preconditions for the project, particularly regarding land acquisition.

‘It’s a signal for foreign investors to be cautious about investing here’

Purbaya Yudi Sadewa,
Danareksa Research Institute
Emaar also hinted that too many officials were looking for kickbacks and bribes.

Meanwhile, it turns out that Emaar is facing serious financial difficulties amid the global financial crisis and is bailing out of projects as quickly as it can.

The company suffered a 2008 fourth-quarter loss of $481.9 million, and its stock has fallen from a high of 11.90 United Arab Emirates dirhams ($3.24) in April last year to just 2.05 dirhams. It was reported from Dubai on Thursday that the company had canceled its annual general meeting without giving a reason, and investors have been petitioning the company to cancel further projects given market uncertainty. To make matters worse, the company also recently sought bankruptcy protection for its US unit.

The Lombok project envisioned a development covering 1,200 hectares on the resort island.

Khaled M. Al-Aboodi of the Islamic Corporation for the Development of the Private Sector, an affiliate of the Islamic Development Bank Group, had previously warned about the importance of secure land titles to Middle Eastern investors.

“For investors who want to invest in property, land ownership for foreigners is important,” he said. “Investors are only interested in becoming involved in projects which they can present to international buyers. Currently, If I want to do a huge development, all I can count on is demand from buyers on the Indonesian side.”

Dian Putra of BCI Asia, a multinational consulting firm, said he was very disappointed with the cancellation, especially given the allegations of corruption.

“Corruption in international megaprojects is commonplace in our country, especially on the part of local government officials,” he said. “Middle Eastern investors will have a problem with that.”
Back to top Go down
View user profile http://www.mimpimanis.com
outahere
Lombok Looney


Number of posts : 415
Location : nowhere
Registration date : 2008-07-02

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Mon Mar 16, 2009 3:04 pm

I also had concerns as to how they would provide enough power and water for such a project. Lombok now has permanent rolling power cuts of around 4 hours per sector as there is not enough power to supply the demand from locals. A few years ago many locals might have used a single electric light at night and every 4th house might have had a TV. Now, as the standard of living gets slowly better, people are buying refridgerators, more televisions, and more using more lights. However there has been no infrastructure improvements to meet the demands.

As for water, that area would not get enough annual rainfall to meet the requirements of such a development - particularly given the sorts of gardens and swimming pools that they would want. They would have needed to build a power station AND a desalination plant to provide for the development.

Goodness knows what the envrionmental impact would have been.
Back to top Go down
View user profile
lolo
Lombok Lover
avatar

Number of posts : 61
Location : France
Registration date : 2008-08-09

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Wed Mar 18, 2009 6:07 am

The story is not 100% finished...
http://www.thejakartaglobe.com/business/article/13317.html

But as we say in France, I think that "the carots are already boiled" Rolling Eyes

This withdrawal is really great sunny

Yes it is time to put South Lombok on the WOrld Heritage List Wink
Back to top Go down
View user profile http://www.lombok.fr
Josi
Lombok Soulmate
avatar

Number of posts : 200
Location : USA
Registration date : 2008-08-05

PostSubject: Don't they eat boiled or cooked carrots in France?   Wed Mar 18, 2009 9:07 am

Lolo,

If I make beef or chicken or egg curry, I will use carrots and potatoes. If I serve you that, will you eat only the meat or also the cooked carrots?
Razz

Basketball Leave Kuta alone. Very Happy

lol!
Back to top Go down
View user profile http://www.sarojini.org
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Wed Mar 18, 2009 9:11 pm

And the latest news........


Janeman Latul

Government Insists Lombok Deal Not Dead

High-ranking Indonesian government officials and Emaar International PJSC have denied that the Dubai-based development company has killed its massive $600 million project to turn a major portion of Lombok Island into another Bali.

“The government of Indonesia and Emaar have extended a delayed joint venture agreement to get the project underway for another three months,” an Emaar spokesman said in an e-mail from Dubai. The spokesman asked that his name not be used.

“Emaar has met its contractual obligations and the Indonesia Investment Coordinating Board [BKPM] has now asked Emaar for an extension of time to meet their obligations under the joint venture agreement,” the e-mail said.

Emaar closed its Jakarta offices on Friday and will coordinate further activities from Dubai, the spokesman said.

“Initially, Emaar set up its Jakarta office to establish a ground presence to drive the project forward and meet the JV obligations, leading to the finalization of negotiations with BKPM.”

However, Emaar does appear to be facing serious financial difficulties amid the global financial crisis, and is closing projects across the globe. The company suffered a 2008 fourth-quarter loss of $481.9 million, and its share price has fallen dramatically.

It was also reported from Dubai on Thursday that the company canceled its annual general meeting without giving a reason

Alwi Shihab, the presidential envoy to the Middle East region, told the Jakarta Globe by telephone from Taipei that the government received verbal confirmation on Friday from Emaar’s chairman, Muhammad Alabbar, that the project would be extended for another three months, although no written confirmation had yet been received.

“We could not get confirmation for the three-month extension until last Friday, when the UAE deputy prime minister and UAE Chamber of Commerce chairman met with the Indonesian task force,” Shihab said. “The chairman called Emaar’s chairman and asked him about the project. According to him, they agreed to extend the time for another three months,” he said.

Winarno Sujas, the Tourism Ministry’s director for business and investment, told the Jakarta Globe on Friday that Vice President Jusuf Kalla would summon related ministries for a meeting today in a bid to save the project.



Correction

On the Monday, March 16 edition of the Jakarta Globe, we reported that Dubai state-owned Emaar Properties PJSC had “announced” it was canceling a $600 million plan to develop a stretch of beach on the island of Lombok into a resort.

Later in the article, we attributed comments about the company’s problems dealing with Indonesian officials to Emaar Indonesia.

None of these comments came from an official spokesperson for the company.

They were all made by Emaar officials.

Neither Emaar Indonesia nor its parent company have made an announcement that they are quitting Indonesia.

We regret the error.
Back to top Go down
View user profile http://www.mimpimanis.com
outahere
Lombok Looney


Number of posts : 415
Location : nowhere
Registration date : 2008-07-02

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Thu Mar 19, 2009 11:01 am

I think that's the same article as Lolo linked to in his 'carrots are boiled' post.
This article sounds more political than anything else - face saving on the part of the government, and I can just imagine what was said to have the paper print the retraction.

So are you disappointed if it doesn't go ahead Gemma? I guess it would affect Mimpi Manis to some extent - but would that sort of development have been good or bad for your homestay? Do you think budget travellers would have tended to stay away from the place if it became a high end Arab tourist resort?
Back to top Go down
View user profile
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Thu Mar 19, 2009 11:28 am

I would like to see the International Airport go ahead but without the big resort... but I guess that is unlikely to happen.

Even without development I think Mimpi manis will continue to tick along nicely. If the new resort does go ahead, I think there will still be the budget travellers.... the surfers will still come I am sure like most destinations you will find that 5* and budget can co exist.

Having said that... there is a leter on the development in today's Jakarta Globe.
Back to top Go down
View user profile http://www.mimpimanis.com
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Thu Mar 19, 2009 11:29 am

Your Letters: March 19
From the BKPM, Clarification on The Emaar Report

We were surprised to learn about your reporting on page one of the Jakarta Globe on Saturday, March 14, and Monday, March 16.

The two articles directly highlighted the Investment Coordinating Board, or BKPM, as the lead coordinator for the planned Emaar project in Lombok since 2008. Upon reading the first article, the BKPM immediately commenced an investigation on the latest facts regarding the Lombok Tourism project that Emaar has been fully committed to. The reason for doing so was our belief that your reports were completely in contrast to the reality.

And we were right. Emaar has confirmed that the company still remains committed to the project.

We were even more surprised and disappointed to learn that no one in Emaar was interviewed by the Jakarta Globe to confirm such news. This fact has made your article that quoted Elly Savitri, human resources manager for Emaar Indonesia, absolutely false and unsubstantiated by facts.

The BKPM and Emaar Properties PJSC will continue the commitment to realize a $600 million property investment project in Lombok. The main terms of the joint venture agreement between Emaar and the Bali Tourism Development Corp., a 100 percent-owned legal entity of the State Ministry for State Enterprises, are that the BTDC will inject the land into the project company, and Emaar will develop the site.

Under the terms of the JVA, the BTDC is to comply with the conditions regarding land titles. As the JVA will expire on March 19, 2009, the BKPM, on behalf of the government of Indonesia, in this case the BTDC, has requested an extension, which has been agreed upon by Emaar, due the legislative process.

Mohamed Ali Alabbar, the Emaar chairman, through the chairman of the UAE Chamber of Commerce, has conveyed to the BKPM its agreement to extend the JVA.



We respect critical journalism at its highest value. By the same token, we despise false reporting and suspicious motives due to their lowest morale and most destructive impacts. Your articles have irresponsibly damaged the national investment climate, as it has been widely quoted by other media, locally and internationally.

Considering Globe Media’s pro-business and investment platform, I must say the articles are far from your own principles and therefore must be corrected. We will not hesitate to take firm actions, both through the journalistic council as well as the judiciary until this matter is satisfactorily resolved.

We demand a clarification and cooperation from your side to minimize the damage that has been inflicted. I do hope you can take this matter seriously as we have, with the highest priority. To this end, we expect immediate corrective actions from your side.



Muhammad Lutfi

Chairman, Investment Coordinating Board





Your Letters
Back to top Go down
View user profile http://www.mimpimanis.com
lolo
Lombok Lover
avatar

Number of posts : 61
Location : France
Registration date : 2008-08-09

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Thu Mar 19, 2009 4:12 pm

Gemma wrote:
I would like to see the International Airport go ahead but without the big resort...

Same for me !! bounce
Back to top Go down
View user profile http://www.lombok.fr
tjabemerah
Lombok Lover
avatar

Number of posts : 76
Location : Ampenan
Registration date : 2008-07-13

PostSubject: wasted money   Mon Mar 23, 2009 2:06 pm

For sure those arabains want to pull out.You can build 20 more big and fancy resorts but you need tourists to fill them.And the most tourist don,t want to come overhere.Emaar most bring them here?Forget it Simply as that.The Gillis are very popular and thats it.I,am almost 24 years around here and it,s still the same mess as in 1985.Okee,better roads and healthcare but the rest is the same.So lombok will be lombok.Few tourist,just enough to survive.And we have very good tuak,arak and brem so don't miss it!!
Back to top Go down
View user profile http://www.hotel-lombok.nl
lolo
Lombok Lover
avatar

Number of posts : 61
Location : France
Registration date : 2008-08-09

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Mon Mar 23, 2009 4:57 pm

Maaf, saya tidak minum alcohol, sama sama orang Sasak albino

But like you, I just hope EMAAR will cancel...
Back to top Go down
View user profile http://www.lombok.fr
Gemma
Lombok Looney
avatar

Number of posts : 591
Location : Kuta Lombok / Jimbaran Bali
Registration date : 2008-07-01

PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   Sat Jun 20, 2009 11:59 am

In the Jakarta Globe Today they ask the question;

We asked: Do you think the Emaar joint venture project in Lombok can be saved?
You replied:


This is all a game! Emaar, just like its affiliated company Nakheel (both government-owned) are in financial trouble at home. They are offering settlement deals like 60 cents per dollar to existing suppliers, and of course they can’t tell you that they don’t have the money! That would cause a panic in Dubai. But they are using a well-known Indonesian problem (land disputes and other delays) to blame it all on Indonesia.
I hope Indonesia stands up for itself and doesn’t take the blame and get negative press for the potential failure of this project.
Well done, Pak Alwi Shihab and Pak Muhammad Lufti for telling them to take it or leave it; it’s your problem not ours. If every politician and/or official would stand up for the country, then Indonesia would be already a lot further along the road to development. Philip, Jakarta


Here is the link if you would like to add a reply to question.

Daily Debate
Back to top Go down
View user profile http://www.mimpimanis.com
Sponsored content




PostSubject: Re: Emaar Withdraws From US$600 Million Lombok Project   

Back to top Go down
 
Emaar Withdraws From US$600 Million Lombok Project
View previous topic View next topic Back to top 
Page 1 of 1
 Similar topics
-
» Seeds of Change Sowing Millions Project $4.99/25 packets
» Project gone bad !!!
» Million Pound Drop
» Mara Predator Project
» Hypo project - part II

Permissions in this forum:You cannot reply to topics in this forum
Lombok Lovers :: Travel Forum :: Lombok In The News-
Jump to: