Sri Mulyani Confident that IKN Will Attract Investor Interest

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Photo: ASEAN Finance – Health Minister Meeting (AFHMM) 2023. (Ministry of Finance Indonesia Public Relations Bureau)

JAKARTA, THE NUSANTARA POST – Finance Minister Sri Mulyani Indrawati is optimistic that the private sector will invest in the Nusantara Capital City (IKN) development project after the government successfully constructs its basic infrastructure utilizing state budget funds (APBN). According to her, the basic infrastructure will serve as a stimulus and attraction for investors to participate in the future development of IKN, including aspects such as road networks.

She expressed this during a high-level dialogue with ASEAN finance ministers under the theme “Promoting Sustainable Infrastructure Development” on the sidelines of the ASEAN Finance Ministers and Central Bank Governors Meeting (AFMGM) in Jakarta, Thursday (August 24, 2023).

“In the initial stages, public funding is indeed required to build basic infrastructure, including roads, before we can attract private sector involvement,” said Sri Mulyani.

Once the basic infrastructure is established, she assured that several supporting infrastructures could be developed by the private sector, including airports, water infrastructure, electricity, and housing.

“When we talk about airports, water, electricity, this will make the investment proposition even stronger for the private sector, just as it does for the housing sector,” she stated as quoted by The Nusantara Post from CNBC (August 25, 2023).

For your information, President Joko Widodo, or Jokowi, is determined to complete a number of ‘giant’ projects in his last year of governance, namely 2024, one of which is the IKN.

To realize this plan, the President has allocated a budget of Rp 422.7 trillion for infrastructure spending in 2024. This budget represents a 5.8% increase compared to the allocation in 2023.

Several infrastructure projects that will receive budget allocations from the state budget for the upcoming year include Rp 213.7 trillion for regional road construction, IKN development, stadium renovations, as well as educational and healthcare facilities.

Read: Indonesia Raises 3 Key Issues in Front of ASEAN Energy Ministers Here is a list of major projects in 2024 that are part of the National Strategic Projects (PSN), including IKN:

  • Natural disaster management in Palu, NTT, and Cianjur cities: Rp 0.16 trillion.
  • ASEAN Summit 2023 arrangement: Rp 0.17 trillion.
  • Renovation of sports facilities: Rp 0.14 trillion.
  • Support for the integrated industrial zone in Batang: Rp 0.70 trillion.
  • Support for the construction of the Trans Sumatra Toll Road: Rp 2.5 trillion.
  • IKN development: Rp 5.61 trillion.
  • Implementation of regional road programs: Rp 7.44 trillion.
  • Sovereign Sharia Bonds (SBSN) issuance: Rp 2.07 trillion.
  • Accelerated development of National Strategic Areas: Rp 10.27 trillion.
  • Natural disaster management in Cianjur by the Ministry of Public Works: Rp 0.09 trillion (CNBC/TNP)

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