This report finds that value capture has significant potential for addressing several of the Government of Indonesia’s key challenges. Building economic corridors will create jobs, social inclusion, and fiscal stability. It will entail developing transport infrastructure, not through stand-alone projects, but through projects that will be part of the creation of economic corridors that will deliver transformational urban regeneration. A virtuous value cycle can close the infrastructure funding gap. It can provide a progressive whole-of-government and policy framework-based approach to creating value, capturing value, and engendering confidence that a share of the incremental economic uplift will be used to repay the up-front financing of the original investments.

Urban and transport infrastructure are key components of the achievement of the United Nations (UN) Sustainable Development Goals (SDGs), especially Goal 11: Creating Sustainable Cities and Communities. To this end, this report outlines options available to the government for the preparation of a national-level value capture policy framework. It looks at Indonesia’s existing policy and regulatory framework in terms of its ability to support value capture as a basis for proactive planning for enhanced economic productivity. It is envisaged that the economic benefits will contribute to the funding of upfront investment, thus reducing the funding shortfall.