Axis Capital Group Review: Indonesia Sufficient to Construction Needs

Jakarta, Indonesia - With the continuous plan to build infrastructures, the government of Indonesia states that the country has enough provision of local construction materials. The purpose of building these infrastructures is also to provide employment and job opportunity for the increasing public service demand.

Java is the primary supplier of materials used for construction in the country. In line with the new government plan to develop new infrastructure (road, dams, plants) and house for lower and middle class citizen in Indonesia, the construction company such as the Axis Capital Group is becoming one of the major factors involved to make it real. 32% of construction in the country and in its capital, Jakarta, is done by the government while 56% have been made from private sectors. Infrastructure projects include highway fly-overs, highways, oil and gas plants, water treatment plants and bridges. Other projects include factories, supermarket and sports clubs.

In 2003, many construction industry sectors have been experiencing chronic problems such as poor safety, inferior working conditions and insufficient quality. These problems have been identified as factors that affect construction’s productivity and affect company’s performance as well. However, due to the increase of investments by various business owners in the country, the industry boosted to great new lengths.

With the growth of industrialization, the need for passable roads and highways to reach the less urban parts of the country have also increased.

The use of natural construction material resources in Indonesian construction industry consumed in more than ten trillion rupiah or more than six hundred and sixty million pound sterling. Iron concrete holds the biggest Iron concrete account the biggest in more than four hundred million pound sterling and the second one is woods in more than two hundred and sixty two million pound sterling respectively [BPS 2002]. And the indices trend up to year 2002 had shown an increasing number for all type of construction in Indonesia.

With the concerns on ecological complaints that may evolve because of these developments, reports states that Indonesia has 1.2% annual deforestation rate and the matter of forest depletion and destruction of nature is very low. Construction projects are an important priority in Indonesia’s national plans. Local contractors participate in the construction of public development projects including large scale infrastructure such as: ports/harbours, terminals, highways, telecommunications, irrigations, waste disposal and treatment; properties; public housing; and industrial buildings.