Highlights of Indonesian Construction Investment

From our perspective as local expatriates who have participated in numerous construction projects and have been in charge of architectural design and construction management services, we would like to introduce “points that Japanese companies involved in construction projects should keep in mind. The content is abstract because it is generalized.

☆ 13 points of construction projects for Indonesia

  1. Business planning for the project should be done in collaboration with local partner companies, including dealing with government authorities.
  2. Local staff with professional business experience and an understanding of the Japanese language and corporate culture are required in the project team.
  3. Preliminary surveys for land and facility procurement should be ordered from multiple experts.
  4. The construction team should be formed mainly by a local design company.
  5. Construction orders should be placed with a major Japanese general contractor that is systematically training local construction teams.
  6. The general contractor services should be separated from the design and construction work, i.e., only construction work should be ordered, and competitive bidding should be conducted with the participation of multiple local general contractors.
  7. Bidding should be conducted after the design firms have completed the implementation design, and the contract should be awarded to the successful bidder (LOA) based on the reduced price after adjustment.
  8. After the start of construction, the construction management team (CM) of the design firm will be responsible for process management, quality management, safety management, cost management, and coordination.
  9. In cooperation with the construction team, a client-side team will be formed to provide instructions and documentation for post-completion warranty support, maintenance management, and facility operation.
  10. When there is a confirmation of work from the Japanese parent company side, coordinate with the CM who understands the local situation and specifications.
  11. The details of inspections prior to the start of construction, during construction, at the time of handover, and after completion of construction should also be specified in the bid documents.
  12. Based on the experience of the Corona Disaster, the scope of responsibility for force majeure provisions, including government regulations, should be clearly defined.
  13. A system must be in place to discuss, determine, and implement a recovery plan for each point of activity, assuming that the activity may not proceed as planned in the contract documents or on the drawing board.

Other notes will be added in a timely manner as necessary.

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