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Former VP Jusuf Kalla talks of problems that plague new capital city project

Tempo - September 22, 2022

Bisnis.Com, Jakarta – Former vice president Jusuf Kalla opined that Indonesia's new capital city project might suffer problems, particularly related to financing. This is because, he said, there is no foreign investment commitment to the country to date.

20 percent of the project financing in East Kalimantan will be covered by the state budget, while the rest 80 percent is expected from foreign investors.

"This will be problematic because until now we have not seen any commitment from foreign investors. It is difficult to invest in a capital city, it's not easy. Consequently, the government will slow down its development. This means that it will not be in line with the initial schedule that the new palace will be celebrated in 2024. The construction schedule will be delayed," said Kalla as quoted from Bisnis, Thursday, September 22, 2022.

Regarding the project cancellation, he emphasized that it is under the government's authority.

According to him, the foreign's interest to invest in Indonesia is not as great as expected. He mentioned that based on other countries' experiences, such as Brazil and Myanmar, relocating the capital city took 20 years to complete.

"Pak [President] Jokowi had also said that it will take time to perfect it," Kalla added.

Besides, he argued that not all institutions were moved to the new capital. The ideal distance of the relocation was also about 30 kilometers, such as the capital city of Malaysia, Kuala Lumpur, which is moving to Putra Jaya.

Jusuf Kalla went on to argue that almost all countries that moved their capital city are federal states unlike Indonesia, viz. the United States, Malaysia, Myanmar, and Australia. This means regions have control of their own affairs.

Source: https://en.tempo.co/read/1637071/former-vp-jusuf-kalla-talks-of-problems-that-plague-new-capital-city-projec