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Gov't already spends $298 million in new capital construction so far this year

Jakarta Globe - May 28, 2024

Jayanty Nada Shofa, Jakarta – The government has spent Rp 4.8 trillion or approximately $298.3 million in the construction of Indonesia's new capital Nusantara as of April 30, according to Finance Minister Sri Mulyani.

Indonesia is relocating its capital from the congested metropolis of Jakarta to East Kalimantan. The bold plan –which requires a total investment of $33 billion– is set to heavily rely on private funding. The government is only planning to fund 20 percent of the total construction costs. The government has allocated Rp 39.8 trillion to build the so-called "city for all" for this year alone.

"This means that we have only used up 12.1 percent of the Nusantara project budget ceiling so far," Sri Mulyani told a press briefing on Monday.

The Finance Ministry divides the Nusantara project expenditure into two categories: the infrastructure works and the non-infrastructure cluster.

The government is planning to spend no more than Rp 36.5 trillion for the city's infrastructure works. As of late April, the infrastructure cluster has consumed about Rp 2.8 trillion. Some of the money went into building the state palace complex and the VVIP airport, to name a few.

"We have spent Rp 2 trillion for the non-infrastructure cluster, such as on planning and promotion, publication, and security," Sri Mulyani said.

The non-infrastructure cluster gets a budget ceiling of Rp 3.2 trillion throughout this year.

The money that the government spent on the Nusantara has been increasing over the past few years.

In 2022, the project cost the government approximately Rp 5.5 trillion. The spending for Nusantara soared to Rp 27 trillion the following year.

Indonesia is currently racing against time in building Nusantara as President Joko "Jokowi" Widodo plans to start working from the new capital this July. Jokowi also wants to celebrate Indonesia's Independence Day –which falls on Aug. 17– in the yet-to-be-built capital.

Source: https://jakartaglobe.id/business/govt-already-spends-298-million-in-new-capital-construction-so-far-this-yea