U.A.E Ruler, SoftBank's Son to Oversee Building of Indonesia's New Capital


(Bloomberg) -- Indonesia nominated Abu Dhabi Crown Prince Mohammed Bin Zayed Al Nahyan to chair a panel to oversee the construction of a new capital, easing the burden on sinking and congested Jakarta.

SoftBank Chief Executive Officer and founder Masayoshi Son and former British Prime Minister Tony Blair will also join the steering committee, according to Indonesia's Coordinating Ministry for Maritime Affairs and Investment. The panel will advise the government on building the new capital at a cost of $34 billion and provide a confidence boost for prospective investors, the ministry said.

Indonesia is set to begin construction of the new capital on Borneo island later this year as President Joko Widodo seeks to decongest a fast sinking Jakarta. SoftBank Group's Son last week expressed interest in building a smart and green city, joining a long list of global investors wanting to participate in the capital relocation project.

Jokowi, as Widodo is commonly known, is counting on private and state-owned entities to bear about 80% of the cost of building the capital. The crown prince accepted Jokowi's offer to helm the panel at a meeting in Abu Dhabi this week where investment deals worth $22.8 billion were signed between companies from the United Arab Emirates and Indonesia, the ministry said.

Jokowi also discussed plans for setting up a sovereign wealth fund with the crown prince and SoftBank's Son, details of which will be finalized at a meeting in Tokyo later this month, Coordinating Minister for Maritime Affairs and Investment Luhut Pandjaitan said in the statement.

Indonesia has identified about 256,000 hectares of land on the island of Borneo for the yet-to-be-named capital -- about four times the size of Jakarta. Regular flooding in the Jakarta metropolitan area, home to almost 30 million people, and the need to spread economic growth beyond the main Java island have prompted Jokowi to fast-track the capital relocation.

Authorities will move the capital in phases from 2024, with the new city eventually becoming home to as many as 6-7 million people.

"We don't want to just build a small-scale administrative capital, but we want to build a smart metropolis because the population will be three times the population of Paris, 10 times the population of Washington DC, and even will equal the population of New York and London," Jokowi said in a statement Monday.

(Updates with comments on sovereign wealth fund in fifth paragraph.)

--With assistance from Rieka Rahadiana.

To contact the reporter on this story: Arys Aditya in Jakarta at aaditya5@bloomberg.net

To contact the editors responsible for this story: Stephanie Phang at sphang@bloomberg.net, Thomas Kutty Abraham, Ruth Pollard

For more articles like this, please visit us at bloomberg.com

©2020 Bloomberg L.P.


More Related News

Will Macron Deliver on His Lofty Promises to Help Beirut?
Will Macron Deliver on His Lofty Promises to Help Beirut?
  • World
  • 2020-08-07 12:03:12Z

(Bloomberg Opinion) -- There were moments during Emmanuel Macron's visit to Beirut on Thursday when it seemed that the French president was in a mosh pit, crowd-surfing over waves of adulation and anger: The adulation was for him, and far more than he might reasonably expect from a Parisian throng; the anger was for the entire Lebanese political class, who are being collectively blamed for the devastating blasts that shattered much of the city on Tuesday.    It is easy enough to cavil, as some have, that Macron's walkabout in the Gemmayzeh neighborhood was political theater. He was always going to get a friendlier reception in a Francophile quarter of East Beirut than, say, in the...

SoftBank seen booking 75% first-quarter profit drop as it returns to profitability
SoftBank seen booking 75% first-quarter profit drop as it returns to profitability

SoftBank Group Corp is seen booking a 75% first-quarter profit plunge on Tuesday, albeit making a return to profitability, as the coronavirus outbreak continued to weigh on the tech bets of CEO Masayoshi Son's $100 billion Vision Fund. Analysts grapple with uncertainty over how the Vision Fund values its portfolio of mostly unlisted technology firms. Faltering bets on startups such as shared office space firm WeWork pushed SoftBank to its deepest annual loss last year.

Indonesia plans cash transfers for nearly 14 million workers
Indonesia plans cash transfers for nearly 14 million workers

Indonesia plans to give cash transfers to 13.8 million workers at a cost of around $2.15 billion under its stimulus package to prop up household consumption in Southeast Asia's biggest economy during the pandemic, officials said. Indonesia reported on Wednesday gross domestic product contracted 5.32% in the second quarter as household consumption, which accounts for more than half of the economy, fell 5.51% from a year earlier. "The government's aim by pouring additional income is to support household consumption, which is important to propel the economy and pushing for economic improvement," State-owned Enterprise minister Erick Thohir said on Thursday.

Hezbollah Will Not Escape Blame For Beirut
Hezbollah Will Not Escape Blame For Beirut
  • World
  • 2020-08-05 11:50:00Z

(Bloomberg Opinion) -- As if the Lebanese haven't suffered enough. For months, they have been caught between an economic meltdown, crumbling public services, and a surging pandemic. Now they must count the dead and survey the extensive damage to their capital after two giant explosions on Tuesday.The blasts, especially the second, were so huge they were reportedly heard and felt in Cyprus. At least 100 people are reported to have been killed-that number will almost certainly rise-and thousands injured. A large expanse of the port and its immediate neighborhood lies in smoking ruin; miles away, streets are full of shattered glass.Prime Minister Hassan Diab's government says the explosions...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Latin America