Investing in Indonesia's New Capital City (NCC): Insights from Sesi Conference Hannover Messe 2023

INTI,- The plan to relocate Indonesia's capital city from Jakarta on the island of Java to Kalimantan Island has been under consideration by the government for some time. This is due to the need for sustainability and the potential for a new model of urban design. The urgent need for relocation includes population distribution, economic growth outside Java, clean water crisis in Java, high land conversion in Java, urban concentration in Jakarta, and declining economic potential and ability in Jakarta.

Speaking at the Sesi Conference with the theme "Investing in the New Capital City", held at the Indonesia Pavilion during the Hannover Messe 2023 industrial exhibition on Tuesday, April 18, the Director General of Cipta Karya, Ministry of Public Works and Housing, Diana Kusumastuti explained that the development of the NCC is divided into five phases: the development of the city's ecosystem foundation in 2022-2024, the development of Nusantara as Indonesia's central area in 2025-2029, further development of Nusantara in 2030-2034, the construction of three cities (Nusantara-Balikpapan-Samarinda) in 2035-2039, and the strengthening of its reputation as "a global city for all" in 2040-2045. The Ministry of Public Works and Housing is working on the construction project for the NCC with a total value of IDR 23.72 trillion, consisting of water sources, roads, urban design, and housing.

Also present at the forum was the Deputy for Economic Affairs of Bappenas, Amalia Adininggar. She explained that the NCC would become a new economy superhub supported by four pillars: the development of human resources with a focus on science and technology, sustainable economic growth, inclusive and equitable development, and the strengthening of national resilience and governance. "The NCC has a tagline: locally integrated, globally connected, and universally inspired. Relocating the NCC to Nusantara is essentially building national identity and positioning the country's capital in the middle of the Indonesian map, known as Indonesiacentric," said Amalia.

Secretary of the NCC Authority, Achmad Jaka Santos Adiwijaya, explained that the relocation of the NCC is based on Law No. 3 of 2022 on the National Capital City, which states that the name of the NCC Indonesia is Nusantara and is a special capital region at the provincial level. The NCC, with a total area of 256,142 hectares, will be allocated for the development of an urban area of 56,180 hectares and a development area of 199,962 hectares. Furthermore, Nusantara will also have the nickname Sustainable Forest City, which is built based on five principles: green, smart, inclusive, resilient, and sustainable.

Vice Chairman of NCC's Investment and Capital Division, Agung Wicaksono, added that in achieving Indonesia's Golden Generation 2045 vision, the Indonesian government has set its focus on the first phase of NCC development, which consists of Top Priority, namely energy, transportation and logistics, water treatment, telecommunications, housing, and waste management. Furthermore, High Priority includes urban management, technology, healthcare facilities, commercial buildings, schools and universities, and industrial areas.

The development of Nusantara offers investment opportunities for investors in both the Top Priority and High Priority sectors. The Indonesian government also provides incentives for investors who will invest in the NCC, such as special tax incentives consisting of tax holidays, super deduction tax for investment in vocational education, research and development. This partnership opens up opportunities for investors to participate in infrastructure development and invest in sectors that are a priority for the development of IKN Nusantara.

IKN Nusantara offers many investment opportunities in various sectors such as renewable energy, transportation, water processing, information and communication technology, health, education, tourism, and others. Investments in IKN Nusantara are expected to increase economic growth in Indonesia, improve population distribution, and accelerate development outside Java Island.

The Conference Session on IKN Nusantara investment at Hannover Messe 2023 was attended by a number of investors and officials from various countries. This conference also serves as a promotional event for IKN Nusantara to attract investor interest in investing in IKN Nusantara.

For investors interested in investing in IKN Nusantara, it is recommended to conduct a risk analysis and study market conditions and government policies related to investment in Indonesia. In addition, make sure to comply with the rules and regulations in Indonesia and consult with legal experts and investment consultants before investing in IKN Nusantara or in Indonesia in general. ***. Hans