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IKN draws no foreign funds so far, but lots of interest: Jokowi
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Work is underway in the Government Center Core Area (KIPP) of the Nusantara capital city project in Penajem Paser Utara, East Kalimantan, on Aug. 22, 2023. (Antara/M Risyal Hidayat)
P
resident Joko “Jokowi” Widodo has admitted that Indonesia’s new capital city megaproject has attracted no foreign investment so far, which experts say is because the project is commercially unattractive, irrespective of external macroeconomic conditions.
Speaking before the press at the Halim Perdanakusuma air force base in Jakarta, Jokowi noted, however, that many had expressed interest in the city, named Nusantara, when Indonesia pitched the project at investment roadshows and during state visits.
“In all countries, we present the progress of [Nusantara] and what investments are available, and many are interested,” Jokowi was quoted by Antara as saying on Monday at an event to dispatch humanitarian aid to Palestine.
He went on to say that more than 300 letters of intent (LoIs) had been inked on the project but no “real” foreign investment had materialized yet. Given the many LoIs, however, it was unlikely that not one of them should result in investment.
“I think there will be a lot [of investments from abroad], it’s just that we are prioritizing domestic investors,” said Jokowi.
Nusantara Capital City (IKN) Authority financing and investment undersecretary Agung Wicaksono said it was not mandatory for foreign investors to partner with local ones to get involved in Nusantara’s development, but it was “preferable” when they did so in this early stage.
It is true that the majority of Nusantara’s investors are Indonesians, Agung said in a press briefing on Monday, but it was untrue to view the project as unattractive to outside investors.
