The Partnership Agreement between Banda Aceh Municipality and Private Parties

Irwansyah, Tan Kamello, Ilyas Ismail and Azhari Yahya
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Irwansyah: PhD Student at Faculty of Law, Syiah Kuala University Aceh-Indonesia
Tan Kamello: Professor at Faculty of Law, University of North Sumatera, Medan-Indonesia
Ilyas Ismail: Profesor at Faculty of Law, Syiah Kuala University, Banda Aceh-Indonesia
Azhari Yahya: Profesor at Faculty of Law, Syiah Kuala University, Banda Aceh-Indonesia

International Journal of Research and Innovation in Social Science, 2021, vol. 5, issue 2, 602-606

Abstract: Public Private Partnership (PPP) as a concept must be able to face the new era of disruption caused by the Fourth Industrial Revolution (4IR). For this reason, it is necessary to re-examine and renew the legal and economic paradigm. Public Private Partnership (PPP) is an effort to improve the community’s economy, such as infrastructure development. Infrastructure development need very large budget, so it requires cooperation with the private sector. The Build Operate and Transfer (BOT) contract collaboration is a new project financing model that is not only benefits the contracted parties, but have benefits the public interest also. The purpose of this study is to determine the increase in Indonesia’s readiness to participate in 4IR and the impact of the Build Operate and Transfer (BOT) cooperation agreement on infrastructure development in the Aceh region. The research method used is juridical normative by using secondary data as the main data in the form of a Build Operate and Transfer (BOT) contract, as well as empirical data issued by the World Economic Forum (Global Competitiveness 2018) to measure readiness in facing 4IR. The results of this study showed overall the method of measuring Indonesia’s readiness to participate in 4IR has increased, with the ratio of the country increasing from 47 to 45 while for the institutional pillar, the capacity of the legal and regulatory framework has increased from 40 to 37. BOT contract between the government and the private sector in large-scale infrastructure development have a positive impact on society. The conclusion of this research is optimistically that the Indonesian state is ready to participate in the 4th Industrial Revolution and there is no need for a legal vacuum to transplant legal movements, but still reconceptualize the Public Private Partnership (PPP) with the Build Operate and Transfer (BOT) Contract to pursue the effectiveness of the law framework.

Date: 2021
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