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Jakarta to remain Indonesia's economic hub, new law says

Jakarta Post - April 1, 2024

Alfina Sekar, Jakarta – Jakarta will stay the nation's economic center even after the city of Nusantara is granted national capital status, a recently passed law says, alongside provisions that call for Jakarta to become a "global city" and require its leaders to be directly elected.

During a plenary session on Thursday, House of Representatives lawmakers passed the Jakarta Special Designation Law, which provides a legal framework for the city's position after Nusantara in East Kalimantan becomes the country's capital, a move slated for August.

After speedy deliberations, the bill, which was brought forward two weeks ago, is now awaiting President Joko "Jokowi" Widodo's signature to come into force. The transfer of national capital status, meanwhile, is awaiting a presidential decree.

Articles 3 (2) and 4 of the law, according to a copy obtained by The Jakarta Post, call for Jakarta to be the nation's economic center and a "global city" as a center of trade, services, finance and business both domestically and internationally.

Home Minister Tito Karnavian said that while Jakarta would lose its national capital status, it would be afforded a special status that would maintain or even increase its contribution to the national economy.

"The government and lawmakers are committed to sustaining the rapid economic growth [of Jakarta], which can not only stimulate economic activity in Jakarta and Indonesia, but also [allow it to become] an important economic hub in Southeast Asia and the world," the minister said during the Thursday plenary session.

The law requires a direct regional election to be held for Jakartans to choose their governor and deputy governor.

Earlier versions of the bill stipulated that the president would have the sole authority to appoint and dismiss Jakarta's governor and deputy governor, after hearing input from the Jakarta City Council. But the plan was scrapped following widespread criticism from the public and lawmakers, who said the move was a setback for the country's democracy.

The law also calls for the formation of a Greater Jakarta oversight council to coordinate the work of ministries and regional authorities in the city and its surrounding areas. The council's head and members are to be appointed by the president. Previous drafts had designated the sitting vice president as the council's leader.

Greater Jakarta is made up of Bogor city and regency, Bekasi city and regency, Depok municipality and Cianjur regency in West Java as well as Tangerang city and regency and South Tangerang municipality in Banten.

The Prosperous Justice Party (PKS) was the only of the nine parties represented in the House to vote against the bill. PKS politician and House Legislation Body (Baleg) member Hermanto insisted that Jakarta should remain a "legislative capital", which would allow House members to stay in the city and not be relocated to Nusantara.

House speaker Puan Maharani of the Indonesian Democratic Party of Struggle (PDI-P) responded that such a provision could be included in a revision of the law once it had come into force.

Still politically competitive

The governorship of Jakarta has historically been a stepping stone to national-level politics and is typically a highly sought-after post, given the city's size, cultural prominence and commercial significance.

Although Jakarta is losing its capital status this year, analysts say the upcoming gubernatorial race will nonetheless be highly competitive.

"The capital relocation won't be done all at once, but step by step. Jakarta will still actually hold a strategic position, include serving as a bridge for the governor to run in the next presidential election," political analyst Ujang Komarudin said on Friday.

Whoever is elected Jakarta's governor in the November election will still be at the center of national attention and news coverage in the next few years, he continued.

But questions remain about the role of the Greater Jakarta oversight council in coordinating regional development and solving the city's longstanding issues, such as traffic, flooding, air pollution and waste management.

Urbanist Yayat Supriatna of Trisakti University said that to work effectively, the council would need extensive authority to punish regional administrations for failures to complete assigned projects.

Otherwise, Yayat continued, the council would go the way of the failed Greater Jakarta Coordination Board, which was established to solve problems in Jakarta and its satellite cities.

Source: https://asianews.network/jakarta-to-remain-indonesias-economic-hub-new-law-says