TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Asset optimization, alternative financing for new capital
One of the biggest challenges in relocating the capital would be financing. The National Development Planning Agency (Bappenas) predicts that the relocation of the capital requires at least Rp 466 trillion (US$32.96 billion).
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
One of the biggest challenges in relocating the capital would be financing. The National Development Planning Agency (Bappenas) predicts that the relocation of the capital requires at least Rp 466 trillion (US$32.96 billion). (Antara/Akbar Nugroho Gumay)
P
resident Joko “Jokowi” Widodo has announced that the location of the new national capital will be in some administrative areas of North Penajam Paser regency and Kutai Kartanegara regency, East Kalimantan province.
In short, the plan to relocate the capital is motivated by two reasons: physical-empirical and political-economic.
The physical-empirical reason signifies the increasingly poor carrying capacity of the environment, congestion, urban sprawl, water crisis and land conversion. While the economic and political reasons include symbols of national identity, reflection of diversity and equitable development.
Jakarta has become the center of nearly everything. As the country’s trade center with a contribution of 20 percent to the national gross domestic product (GDP) of the trade sector, the financial services center with a contribution of 45 percent to the national GDP of the financial services sector, and the services center, which contributes 68 percent to the national GDP of the services sector.
The most strategic central business district (CBD) in Jakarta is known as the golden triangle, including Jl. MH. Thamrin, Jl. Sudirman and Jl. Gatot Subroto. The CBD has also expanded outside the golden triangle, namely Jl. Rasuna Said, Jl. TB Simatupang and Jl. MT Haryono. Not only are they filled with high-rise buildings such as office towers, hotels, shopping centers and luxury apartments, many buildings in CBDs are additionally used as government and embassy offices and regional government representative offices.
After the completion of the new capital, most government buildings in Jakarta, mostly in prime areas, would become vacant.
One of the biggest challenges in relocating the capital would be financing. The National Development Planning Agency (Bappenas) predicts that the relocation of the capital requires at least Rp 466 trillion (US$32.96 billion).
