President Jokowi defended his decision to build an entirely new capital during a historic cabinet meeting on Monday (12/8/24,) saying that the move could spread economic activities from Java, according to Jakarta Globe.
For the first time in history, the government held a cabinet meeting at the new capital Nusantara, locally known as Ibu Kota Negara or IKN. As Jokowi and his ministers gathered indoors at the Garuda Palace to discuss strategic matters, many of the city’s projects outside were still under construction.
Jokowi started the cabinet meeting by saying that not many countries could build a city from scratch. Indonesia is trying to move its capital from crowded Jakarta to Nusantara. Jokowi is hoping that this capital relocation can help spur inclusive growth across the archipelago of Indonesia. Economic activities have been heavily concentrated on Java, and Jokowi wants this to change, says Jakarta Globe.
“I’m pretty sure the [new capital Nusantara] can drive economic growth for East Kalimantan, specifically Balikpapan and the regency of North Penajam Paser,” Jokowi told his ministers.
“The reason behind this capital relocation is because we want equitable economic development. Java makes up 58 percent of our national gross domestic product (GDP,) and that is why we want regions outside Java to also see economic activities,” Jokowi said.
A press release from the website of The President of The Republic of Indonesia says that in his introduction, President Jokowi explained that Nusantara was built with the concept of a forest city filled with green plants as well as being a smart city, supported by technology in every aspect.
He also explained that all mobility activities in the IKN will use electric vehicles and green energy, emphasizing the importance of green buildings in the IKN and accessibility that is friendly to pedestrians and cyclists. The President also emphasized that the IKN will become a center for a green and digital economy and cover various sectors.
Jakarta Globe says that Indonesia is home to some 270 million people, according to the 2020 national census by the Central Statistics Agency (BPS). There are almost 48.3 million people currently living in West Java and 40.7 million people in East Java. Jakarta, on the northwest coast of Java, has 10.6 million people, while neighbouring Banten has a population of 11.9 million. Central Java has 36.5 million residents with Yogyakarta; a special region also located in Java, has almost 3.7 million people.
“As many as 56 percent of our population live in Java, so that’s something we factor in when moving the capital … And we all know how Jakarta has become overcrowded,” Jokowi said.
In addition to discussing the IKN, the plenary session also discussed several other important issues. The President highlighted the decline in Indonesia’s PMI (Purchasing Manager Index), which has entered a contraction level after 34 consecutive months of expansion, and instructed ministers to anticipate the decline in the PMI.
“I want to find out the main cause and anticipate it immediately because I see that this PMI decline has been happening for the past 4 months,” said the President.
The President also emphasized the importance of buying local products, the ease of local raw materials, and protecting domestic industries. In addition, he encouraged the search for new export markets to overcome the economic slowdown of Indonesia’s main trading partners.
“We must be able to find non-traditional markets and seek out potential new export markets,” said the President.
This Plenary Cabinet Session not only marks the beginning of a new era in the capital city of the archipelago, but also shows the government’s commitment to maintaining Indonesia’s economic growth amidst increasingly complex global challenges.
Jakarta Globe says that early government estimates reported that Indonesia would need USD 33 billion to build Nusantara, but the government is only planning to pay for 20 percent of the total costs. Jokowi wants investors to cover the rest of the funding under a public-private partnership scheme. According to Jokowi, Nusantara has garnered investments worth a total of IDR 56.2 trillion (around USD 3.5 billion) to date.
Source: Jakarta Globe, Website of The President of The Republic of Indonesia
Photo by BPMI Setpres/Muchlis Jr
