Andreas D. Arditya, Jakarta – The Jakarta administration said that it had issued a gubernatorial decree to restrict the issuing of mall construction permits in the city until 2012, but the new regulation is rife with loopholes.
Governor Fauzi Bowo earlier said the suspension was needed to give the city administration time to evaluate whether Jakarta had entered its mall saturation point.
During the evaluation, the city will not issue new permits for the construction of malls and trade centers. The decree would be effective only until December 2012.
However, interim director for the Jakarta Building Supervisory Agency (P2B), Wiriyatmoko, said on Tuesday that the city administration would only stop issuing permits for shopping malls and commercial centers bigger than 5,000 square meters.
Exception will also be given to those contractors wanting to establish new malls in the Jl. Dr. Satrio area, South Jakarta, and in the whole of East Jakarta. The city said that these two areas were considered the engines of growth in terms of 2011-2030 spatial planning.
"The point is that permits for the construction of new malls will be given to those that are less than 5,000 square meters in size and in strategic locations, so that they won't disrupt traffic and pollute the environment," Wiriyatmoko said.
He also said that the city administration would approve permit applications submitted before the decree was issued. Permits issued by previous administrations would still be valid.
"Management of the Gandaria City mall in Kebayoran, for example, obtained its permit in 1996 but because of the economic crisis it was only built in 2009," he said.
The Indonesian Shopping Center Association (APPBI) said earlier that the moratorium would create positive impacts for the business, as mall operators would have more time to devise new campaign strategies.
Wiriyatmoko said that in the near future, no new permits would be given to applicants in Central and South Jakarta as commercial centers would be focused only on East and North Jakarta areas.
Jakarta now has 564 shopping centers, consisting of 132 malls and 432 traditional markets and supermarkets.
Separately, the city's assistant for economic and administrative affairs, Hasan Basri Saleh, said that consumerism was the biggest source of growth in the capital, higher than in any other city in the country.
Data from the administration showed that Jakarta's average per capita GDP had reached US$10,000 (Rp 89.28 million), far above the national per capita GDP of around US$3,000. The city is expecting an economic growth rate of 7 percent, following last year's 6.51 percent growth.