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IKN Authority admits less than half of LoIs represent real investment proposals
The agency noted that a majority of proposals were primarily bids to serve as contractors or suppliers for projects in the area.
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The general view of the Garuda Palace, the state palace and the ceremonial field in the future capital of Nusantara, North Penajam Paser regency, East Kalimantan is seen on Aug. 16, 2024. (Antara/M Risyal Hidayat)
T
he Nusantara Capital City (IKN) Authority has revealed that fewer than half of the 500 letters of intent (LOIs) it has received, are genuine investment proposals for the megaproject spearheaded by former president Joko “Jokowi” Widodo.
That amounts to only 200 LoIs. The remaining proposals were primarily bids to serve as contractors or suppliers for projects in the area, the authority said.
"After evaluation, we found that not all LOIs represented real investment commitments. So, we conducted a rigorous selection process," said Agung Wicaksono, deputy chief for funding and investment at the IKN Authority, on Monday, as quoted by Bisnis.
Agung further noted that of the 200 proposals, only 40 of them had advanced to signing a cooperation agreement (PKS) as of this month.
Since its inception, the government has funneled Rp 89 trillion into the development of the new capital.
On several occasions, the government had boasted of the number of LoIs inked in relation to the project, but no “real” foreign investment has materialized as yet. Several experts suggest the number of LoIs had become the government’s way of raising hype on the project.
Former president Jokowi even actively showcased progress by holding frequent groundbreaking ceremonies, almost on a monthly basis, despite little to no progress having been made by those entities.
