Analyzing the Impact of Industrial Areas Development on Investment Feasibility of Patimban Access Toll Road using a Dynamic System Method

Abstract

The Government of Indonesia continues to build infrastructure through National Strategic Projects/Proyek Strategies Nasional (PSN). One of those projects is the Patimban Access Toll Road which allows connectivity to one of the biggest ports in Indonesia. Ministry of Public Works and Public Housing of Republic of Indonesia offers business entities to participate in building the Patimban Access Toll Road with investment project data that still shows that the project is not considered feasible. In the development of the Patimban Access Toll Road, the government plans to build an industrial area around the project, which has the potential to increase travel demand, increasing the investment feasibility of the Patimban Access Toll Road. This study uses a travel demand forecasting approach with a dynamic system simulation model that can provide reliable estimation to compare the project's financial feasibility before and after involving industrial areas around the project. In this simulation model, scenarios is carried out to compare the financial feasibility with the possible tariffs. The output of this research is an analysis of financial feasibility after the existence of industrial areas and recommendations for the optimal tariff to produce an Internal Rate of Return (IRR) which shows that the project is feasible with high availability of payments.