Danantara Management Must Be In Accordance With ESG And Free From Political Intervention

JAKARTA - Head of the Center of Macroeconomics and Finance Institute for Development of Economics and Finance (Indef) M. Rizal Taufikurahman stated that the management of Danantara must comply with Environmental, Social, and Governance (ESG) standards to attract foreign investment.

"To attract foreign investors, the government must ensure that Danantara is managed professionally, free from political intervention, and implement the ESG-based governance standard," said M. Rizal Taufikurahman when contacted by ANTARA from Jakarta, Sunday.

He said that the government also needed to ensure regulations that were transparent, policy stability, and legal certainty in investing in the institution.

"Without this foundation, global investors will hesitate to invest (in Danantara)," he said.

In addition, he said that the provision of competitive fiscal incentives and the existence of protection for investment is also crucial so that Danantara is able to compete with investment fund management institutions and state wealth or sovereign wealth funds in the region.

"If the investment security system is weak, Danantara will only become an administrative entity without strategic attraction for global investors," said Rizal.

He said, if Danantara is able to show its commitment to attracting investment, strengthening the operational efficiency of State-Owned Enterprises (BUMN), and encouraging profitability, then investor confidence will increase and market participants will respond positively.

However, if the management of Danantara only extends the bureaucracy related to investment without concrete economic added value, market participants will actually doubt the effectiveness of the institution so that it has an impact on reducing the valuation of BUMN assets and investment growth to stagnant.

"Of course this will have an impact on low economic growth performance," added Rizal.

Just so you know, President Prabowo Subianto plans to officially launch Danantara on Monday, February 24.

Presiden Prabowo menuturkan bahwa Daya berarti energi atau kekuatan, sementara Aagasta berarti masa masa depan, sehingga Daya Anagata Nusantara berarti "energi atau kekuatan untuk Tanah Air atau Nusantara di masa mendatang".

"So, it means that Danantara is an economic force, an investment fund that is Indonesia's energy, future strength. The country's wealth is managed, saved for our children and grandchildren," said President Prabowo on Monday, February 17.