Indonesia’s President Joko Widodo broke ground on Wednesday for a Chinese firm’s property complex in the Southeast Asian nation’s troubled new capital on the island of Borneo, hailing it as a pioneering foreign investment that will lure others.
Indonesia’s Troubled Economy
Years after the president unveiled his $32-billion flagship plan, aimed at easing the burden on congested, sinking and overpopulated Jakarta, the new capital has battled problems from construction delays to a lack of foreign investment.
Chinese property firm Delonix Group is “the pioneering foreign company investing in the new capital,” said Jokowi, as he is popularly known, with its investment of 500 billion rupiah ($33 million) in the complex of hotels and offices.
“And this will bring confidence in other investors to enter the new capital,” he added.
It is the first foreign investment in the new capital, said authorities there. Delonix did not immediately respond to a request for comment.
Seeking Foreign Investments
Jokowi earlier presided at the groundbreaking of another property complex developed by a domestic firm in partnership with a Russian developer.
The new capital of Nusantara is being built in a forested pocket on Borneo, about 1,200 km (745 miles) from Jakarta, home to 10 million people.
The government has said just a fifth of the total budget for the plan will come from its coffers, with the rest from private investment.
Nusantara has previously received a $1.3-billion investment from a consortium of Indonesian companies.
Jokowi, who has said work on the capital could last decades, plans to spend the final weeks of his administration there, he said this month. His successor, President-elect Prabowo Subianto, is set to take office on Oct. 20.
($1=15,080.0000 rupiah)
(With input from Reuters)
