Erick Thohir: Manage Funds Of IDR 15 Trillion, IWF Will Improve Access To Clean Water Of 40 Million Residents

Minister of SOEs, Erick Thohir. (Photo: Doc. Ministry of SOEs)

JAKARTA - The government has launched the Indonesia Water Fund (IWF) program as an effort to improve access to clean water for all Indonesian people. The launch was held at the International Conference of SOEs or State-Owned Enterprises (SOE) International Conference which was held in Nusa Dua, Bali, Monday 17 October. Vice President Ma’ruf Amin said that the existence of IWF as a platform to support the acceleration of investment in the provision of clean water connections to homes is expected to be an alternative solution for the Government through non-APBN funding. "The Indonesian constitution recognizes and guarantees the right to water as the embodiment of the fulfillment of the human rights of the Indonesian people, as well as social rights in which the role and involvement of the Government becomes a necessity," said Ma’ruf Amin when opening the SOE International Conference online. For this reason, according to Ma’ruf, water must be managed as a national wealth as well as the people's need to realize prosperity and justice for all Indonesian people. "I hope that the Indonesia Water Fund launched today can improve the welfare of the people in the future," added Ma’ruf. The Ministry of SOEs held the SOE International Conference & Expo 2022 with the theme "Driving Sustainable and Inclusive Growth" on 17-18 October 2022 in Nusa Dua, Bali. This event is part of Trade, Investment, and Industry Working Group (TIIWG) Road to G20. SOE International Conference is held as the government's commitment to support the implementation of Environment, Social, and Governance (ESG) and Sustainable Development Goals (SDGs) aspects, particularly in the health sector, financial inclusion, digital transformation and energy transition. The Indonesian Water Fund (IWF) was initiated by the Ministry of SOEs through the synergy of Holding BUMN Danareksa (Danareksa, Nindya Karya, Perum Jasa Tirta 1, and Perum Jasa Tirta 2) to bring water connections to various regions in Indonesia. Minister of State-Owned Enterprises Erick Thohir revealed, IWF focuses on three pillars that offer an investment approach with sustainable benefits and provide integrated access from upstream to downstream. IWF can be carried out in accordance with investment models that match investor profiles with schemes that are easily replicated throughout Indonesia. Erick said that the role of strategic partners is needed in the IWF program in order to achieve optimal results in the operation process. "The initial target is that IWF will manage funds of US $ 1 billion or around Rp. 15 trillion from strategic partners to improve access to clean water for the 40 million people of Indonesia. In accordance with IWF principles, namely the provision of investment platforms that are easily replicated, so that the addition of house connections to accelerate access to clean water will be continuously improved," said Erick Thohir. Erick added that IWF is a fast solution for equitable access to clean water, accelerates the provision of inclusive, sustainable, and efficient clean water for all Indonesian people, as well as expanding the coverage of national clean water services. IWF is also a form of funding for clean water that runs side by side with the APBN independently, so that it does not burden the state budget directly. "IWF is an effort to maximize Indonesia's GDP, because insufficient water supply will have the potential to reduce Indonesia's GDP by 2.5 percent by 2045," explained Erick. The National Socio-Economic Survey (Susenas) of 2021 noted that households with access to drinking water only reached 90.8 percent, of which about 12 percent of households had access to safe drinking water, and approximately 19 percent had access to piped drinking water. Based on data from the Danareksa Research Institute, water consumption is increasing in line with the increase in population. However, water scarcity is a big problem in several countries and along with poor water quality is the cause of disease spread. In the future, the issue of scarcity and water quality must be a priority. The realization of investment/financing for the irrigation and sanitation sector has not met the needs. IWF is an alternative to financing the irrigation sector in Indonesia which involves SOEs, private parties, and investors. With the source scheme, the funds are expected to ease the burden on the state budget.