A commitment to innovation-and to Indonesia
Mitsui managed to pull off this deft sideways step into a new field for two reasons: First, the company has a culture of innovating based on pulling together people with complementary expertise from different departments (in this case, the Infrastructure Projects Business Unit and the Transportation Logistics Business Unit). Second, recent company policy has been about switching more to an operatorship model, with Mitsui seeking ownership and control of the businesses it invests in.
Three factors made relative newcomer Mitsui the most attractive candidate: local experience coordinating similar large public-private infrastructure projects (such as the Paiton Power Station in East Java); local sector-specific know-how (Portek was already running a container terminal in Jakarta focused on domestic freight); and a long-term commitment to growing the broader Indonesian economy, expressed through ventures in fields ranging from oil and gas to telecoms.
After the awarding of the priority negotiating rights, it took 13 months-rather than the expected three or four-to finalize the contract. But there were good reasons for the delay. Since the Indonesian government had never before worked with an overseas partner to build a container terminal, there was no existing framework to follow. In addition, with Indonesia’s economy developing at breakneck speed, regulations governing things like accounting and taxation are still evolving. An unusual degree of flexibility needed to be built into the contract as a result.