President asks for high investment interest in the New Capital to be accommodated
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily - Presiden minta tingginya minat investasi di IKN ditampung
29 November 2022
By: Amrozi Amenan
President Joko Widodo asked his ranks to accommodate the high investment interest in New Capital City (IKN) that is claimed to have increased by 39 times after the market sounding for Core Government Area (KIPP). Meanwhile, Public Works and Housing (PUPR) Minister Basuki Hadimuljono said that there are 25 construction activities in IKN that have been contracted until the fourth week of November 2022 worth Rp15 trillion.
“After the market sounding, the interest of investors developed extraordinarily by up to 40 times, or 39 times to be exact, for areas that we have prepared for investment in the first stage. I am underlining that it is in the first stage in Core Government Area,” IKN Management Authority Chair Bambang Susantono said in his official statement after the limited meeting that discussed the status of the investment interest in IKN led by President Joko Widodo and attended by several people in his ranks at Merdeka Palace in Jakarta on Monday (28/11/2022).
Bambang mentioned that investment interest in IKN was high, especially after the market sounding. In response to the high investment interest, President Joko Widodo directed the areas in IKN to be reopened to accommodate the interest of investors that were not accommodated in zone 1A where the Presidential Palace and several ministries will be located.
“We are reopening 1B and 1C. So, zones in KIPP or Core Government Area will be opened for investors who are interested,” he added.
Furthermore, Bambang explained that the government is not only opening investment opportunities in KIPP, but also in other areas. The zones include tourism areas, financial and economic centres, education areas, as well as health areas.
“So, his direction is to open [opportunities] as wide as possible for investors to join and build in IKN,” he said.
“Inshallah (God willing), it will be realised next year, so the progress next year will be more visible. There will be more construction that we will commence. So, in 2024, when the President will hold a ceremony in the IKN, he can see the developments in the field,” he added.
Construction progress
Meanwhile, PUPR Minister Basuki, at the work meeting with House of Representatives (DPR) Commission V on Monday (28/11/2022), revealed the construction progress of infrastructures in IKN from 2022 to 2024 that include 40 construction activities.
“We have commenced the construction of IKN in 2022. The construction of basic infrastructures in the core government area, which is planning area 1A, is point zero in IKN,” Basuki said.
The infrastructure constructions include Balikpapan-Banjarmasin toll road to Balang Island Bridge. Then, there is also the raw water preparation through Sepaku River intake by completing Sepaku Semoi Dam that also supports the Environment and Forestry Ministry that is preparing a nursery.
Besides that, Basuki said roads in the land development area and several offices would be constructed this month.
Basuki also mentioned that tenders were held in 2022 for constructions in KIPP and its vicinity in zone 1A.
“Constructions in KIPP in zone 1A include 25 activities that have been contracted until the fourth week of November,” Basuki said.
In detail, Basuki said that there were four activities by Water Resources Directorate General worth Rp1.08 trillion. The activities include the construction of Sepaku Semoi Dam with progress reaching 78.7%.
“Hopefully, it can be completed by this December,” he said.
Then, the progress of the intake and transmission pipe network of Sepaku River for raw water has reached 47.2%. The progress of raw water provision for Mentawir Nursery to support Environment and Forestry Ministry has reached 45.9%.
Meanwhile, Highways Directorate General has 12 activities worth Rp8.71 trillion. The activities include the construction of Sepaku Ring Road with progress reaching 45.7%, IKN toll road with progress reaching 1%, Western National Axis Road with progress reaching 1%, ITCI Interchange-Riko Interchange Road with progress reaching 66.4%, Riko Interchange-Short Span Balang Bentang Island Bridge Road with progress reaching 58.8%, as well as panel bridge procurement stage two.
“Besides that, there are four other activities from Highways [Directorate General] worth Rp1.59 trillion, including the construction of the access to Mentawir Nursery and the Logistics Pier at Balikpapan Bay,” Basuki stated.
There are also activities managed by Human Settlements Directorate General that reach five activities worth Rp4.66 trillion. The activities include land development preparation in KIPP stages 1 and 2 to create lots using trees.
“So, with the land development, we know where the offices of each ministry, the president, and the vice president will be located,” Basuki stated.
Besides that, there is also the housing development that targets to construct 22 towers for construction worker housing. Seven towers are currently being constructed with progress reaching 36.8%.
“So, the work method in IKN is that construction workers cannot build their own temporary housing. All of these towers are for construction workers,” he said.
