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Prabowo’s Danantara faces uphill battle for investor trust
Analysts have warned that the fund will face challenges in winning investor trust given its governance structure.
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President Prabowo Subianto (center) shakes hands with former president Joko “Jokowi“ Widodo during the launch of a sovereign wealth fund known as Daya Anagata Nusantara, or Danantara, in Jakarta on Feb. 24, 2025. (AFP/Bay Ismoyo)
P
resident Prabowo Subianto launched Danantara, the nation’s newest sovereign wealth fund, with US$20 billion in initial capital on Monday, but analysts have warned that the fund will face challenges in winning investor trust given its governance structure.
Danantara is a superholding set to consolidate all state-owned enterprises (SOEs) and is envisioned as a national investment management firm akin to Singapore’s Temasek.
Prabowo appointed Investment and Downstream Minister Rosan Roeslani as the fund’s CEO, marking a reversal from the President’s earlier decision to appoint former OJK head Muliaman Hadad to the position in October of last year.
Rosan is joined by Deputy SOEs Minister Doni Oskaria as chief operating officer and Pandu Sjahrir, an entrepreneur and nephew of former senior minister Luhut Pandjaitan, as chief investment officer.
The firm, which is to manage $900 billion in assets, will report directly to the president while operating under a supervisory board led by SOEs Minister Erick Thohir, with Muliaman now serving as his deputy.
The House of Representatives passed a bill on Feb. 4 to amend the existing SOEs Law, laying the legal groundwork for Danantara’s formation after a series political compromises ended a tug-of-war among key stakeholders that had delayed Danantara’s progress since the initially planned launch in November of last year.
The new version of the law moves almost all government stakes in SOEs from the SOEs Ministry to Danantara and protects the agency’s executive from being persecuted for losses incurred through investment decisions provided they were made in good faith, raising concerns about potential corruption and moral hazard.
