25-9-2024 (JAKARTA) President Joko Widodo, popularly known as Jokowi, presided over a groundbreaking ceremony on Wednesday for a pioneering foreign investment in Nusantara. The event marks a crucial step forward for the US$32 billion venture, which has faced numerous challenges since its inception.
Chinese property firm Delonix Group has emerged as the trailblazer, committing 500 billion rupiah (approximately US$33 million) to construct a complex of hotels and offices in the fledgling city. This investment represents the first foreign capital injection into the new capital, a fact eagerly highlighted by local authorities.
President Jokowi, speaking at the ceremony, expressed his optimism that Delonix Group’s involvement would serve as a catalyst, inspiring confidence in other international investors to follow suit. The Indonesian leader emphasised the transformative potential of this initial foreign investment, viewing it as a harbinger of future economic growth and development in Nusantara.
The new capital project, conceived as a solution to alleviate the myriad problems plaguing Jakarta – including severe congestion, environmental degradation, and overpopulation – has encountered its fair share of obstacles. Construction delays and a dearth of foreign investment have cast shadows over the ambitious plan to relocate Indonesia’s seat of government to the island of Borneo.
Earlier in the day, President Jokowi also inaugurated another property development, a joint venture between a domestic firm and a Russian developer, further underscoring the government’s push to attract diverse investment sources.
Nusantara, situated approximately 1,200 kilometres from Jakarta in a forested area of Borneo, is envisioned as a modern, sustainable metropolis. The Indonesian government has stated that it will only fund one-fifth of the total budget, relying heavily on private investment to realise this grand vision.
While the project has previously secured a US$1.3 billion investment from a consortium of Indonesian companies, the entry of Delonix Group marks a pivotal moment in attracting international capital.
As Jokowi’s tenure draws to a close, with president-elect Prabowo Subianto set to assume office on October 20, the outgoing leader has expressed his intention to spend his final weeks in office at the new capital site.
