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Hungary commits $250m to new joint investment fund
The Indonesia-Hungary Investment Fund is to finance national infrastructure projects, which the government aims to accelerate following last year's delays due to the pandemic.
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Public Works and Housing Ministry officials (right) meet with representatives from the Hungarian Embassy in Jakarta (left) on April 21, 2021 at the former's office. (Courtesy of Public Works and Housing Ministry)
H
ungary has committed US$250 million to the newly established Indonesia-Hungary Investment Fund (IHIF) to help finance the government’s infrastructure projects.
In a press statement on Wednesday, the Public Works and Housing Ministry said that the funds, to be allocated to the IHIF no later than this June, would help cover the gap between its annual budget and estimated project costs.
The government has allocated Rp 623 trillion ($42.82 billion) to the ministry’s infrastructure projects for 2020-2024, but they have an estimated cost of over Rp 2 quadrillion, more than three times the budget allocation.
“I hope the projects financed through the IHIF will have more local content and create jobs in Indonesia,” Public Works and Housing Minister Basuki Hadimuljono said in the statement.
Basuki added that Indonesian and Hungarian stakeholders were forming a working group to determine the terms and conditions of the fund, such as investment and local content requirements. The group would include representatives from the ministry, the Finance Ministry, the Indonesia Investment Authority (INA) and the Hungarian Embassy in Jakarta.
“The public works ministry will focus on developing the infrastructure projects while financial matters will go under the Finance Ministry,” he said.
The INA, the country’s sovereign wealth fund, aims to fund national development projects and is slated to receive investments with a combined worth of $19.5 billion from the United States, Canada, Japan, the Netherlands and the United Arab Emirates (UAE), which has committed the largest investment amount to date.
