Eco-city development in Riau at risk as Indonesia pledges to prioritise community

[JAKARTA] Indonesia’s President Joko Widodo has called for a harmonious resolution to protests on Rempang Island against a new industrial development, and said his government will prioritise the rights of the community that would be displaced by the project.

This directive was communicated during a meeting with several ministers in Jakarta on Monday (Sep 25), according to a document circulated by the president’s communications team.

“During the initial meeting, President Joko Widodo emphasised that the resolution of the Rempang Island issue should be conducted amicably and must prioritise the rights and welfare of the neighbouring community,” said Investment Minister Bahlil Lahadalia in a press conference following the meeting.

Indonesian authorities had proposed a development called Rempang Eco-City on the island, which lies just south of Batam and is part of the Riau archipelago, in hopes of boosting economic development and infrastructure in the region.

The development is a joint venture between government entity BP Batam and local company Makmur Elok Graha, which has partnered a unit of Xinyi Glass Holdings, a Chinese manufacturer of glass and solar panels.

In July, Xinyi made a commitment to invest US$11.6 billion in a glass and solar panel manufacturing plant in Indonesia. The company is among the world’s largest solar glassmakers, and the plant was to be the world’s second-largest such factory.

Coordinating Minister of Maritime and Investment Affairs of Indonesia Luhut Pandjaitan said the plant would create 35,000 jobs. The entire eco-city project is expected to bring in 381 trillion rupiah (S$33.8 billion) in investment by 2080, officials said.

The development would have involved relocating some of the residents on Rempang Island, which covers an area of about 165 square kilometres and is part of the Batam municipality. The island has been home to native Malay, Orang Laut and Orang Darat people since the 17th century.

Rempang residents were to be relocated to nearby Galang Island, with an offer of up to 500 square metres (sq m) of land and a 45 sq m house worth 120 million rupiah for each family.

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The plan has been rejected by locals, however, and there have been multiple protests this month demanding a halt to the project.

Dozens of students from a nearby middle school were taken to hospital after being affected by tear gas fired by the police, the school principal told local media.

Muhammad Rudi, chief of BP Batam, said the government would not overlook the rights of individuals impacted by development.

A delay or suspension of the eco-city development would set back plans by Xinyi to expand outside China, even as Chinese companies come under greater scrutiny by politicians in the United States and Europe.