The Multilateral Cooperation Center for Development Finance (MCDF) has approved a USD1.45 million grant to support the Indonesia Trans-Sumatra Toll Road (Cinto Kenang to Sentjalang) Project proposed by the Asian Infrastructure Investment Bank (AIIB).   

The grant will facilitate active collaboration between the government of Indonesia and AIIB in undertaking high-quality project preparation in the context of AIIB’s proposed investment in the Trans-Sumatra Toll Road (JTTS) (Cinto Kenang to Sentjalang) Project, particularly related to environmental and social (ES) safeguards, road safety, and understanding the secondary impacts of the proposed investment project from the perspectives of environmental and social sustainability and land use. Information on the underlying AIIB investment is available here. The activities to be financed by the MCDF grant will include:  

• A biodiversity baseline survey and a socio-economic survey, which will serve as inputs for the government of Indonesia to develop its environmental impact assessment and land acquisition plan in compliance with AIIB’s Environmental and Social Framework (ESF) requirements.  A panel of local and international experts will be engaged to review the ESF documents during project preparation.
• A road safety review of the road engineering design, which will provide design recommendations that incorporate international best practices and demonstrate an economically viable design scheme. 
• A strategic environmental and social assessment to understand the secondary impacts of the JTTS’ alignment and support the government’s plans to spur economic development in the Sumatra Island in a sustainable manner.

MCDF CEO Zhongjing Wang said MCDF’s financial assistance ensures Indonesia’s ongoing endeavour to enhance connectivity across the world’s largest archipelago nation prioritizes social and environmental considerations. 

“As a nation consisting of thousands of islands, Indonesia is understandably intent on enhancing national interconnectivity, which then extends its connections with other countries,” he said. “MCDF’s partnership with AIIB and the Indonesian Government helps to ensure that Indonesia’s development of new connectivity infrastructure meets the world’s highest standards of sustainability.”  

The MCDF Governing Committee agreed to provide MCDF funding assistance to the Indonesia Trans-Sumatra Toll Road project recently. This brings the total number of projects approved by MCDF’s Finance Facility to seven in the past eight months. 

Launched in 2020, MCDF is a multilateral initiative designed to meet the needs of developing countries for high quality connectivity infrastructure investments that are aligned with achieving the Sustainable Development Goals and implementing the Paris Agreement on climate change.