JAKARTA - Development funding through a sovereign wealth fund (SWF) is expected to accelerate development, particularly transportation infrastructure in Indonesia. SWF is a funding alternative outside the limited state revenue and expenditure budget (APBN).
Minister of Finance (Menkeu) Sri Mulyani Indrawati said the government is using the Investment Management Institution (LPI) or Sovereign Wealth Funds (SWF) instrument as a means of collaboration to continue domestic development in the form of equity.
Sri Mulyani said, the presence of an instrument called the Indonesia Investment Authority (INA) would be able to reduce the government's debt exposure.
"The establishment of an investment management agency or the Indonesia Investment Authority. This is one of our efforts to continue to increase the attractiveness of the Indonesian economy, including providing options for investors to invest in Indonesia," he said, in a webinar, Wednesday, March 3.
Furthermore, Sri Mulyani explained that the LPI is one of the government's efforts to increase the attractiveness of the Indonesian economy, as well as to provide options for investors to invest in Indonesia.
Not only that, Sri Mulyani said that the investment institution would also help alleviate the APBN which had limitations. This year and in 2020, the state budget must be the main instrument to drive the economy from the impact of the COVID-19 pandemic.
"The APBN is still a policy instrument that will determine the continuation of the national economic recovery," he said.
Meanwhile, Sri Mulyani said that the need for infrastructure development in Indonesia is still very large. For example, for the construction of roads, electricity, toll roads, ports, airports, clean water and sanitation, to the fields of technology, information and communication.
The government is targeting an initial investment of IDR 300 trillion SWFSri Mulyani targets the investment management agency of the Indonesia Investment Authority (INA) to attract investment funds of Rp. 300 trillion with the issued capital.
"With the ownership in the fund formed is INA 30 percent and investors 70 percent, we hope that INA will be able to attract investment funds, with IDR 75 trillion that the government has put in, it is targeted that IDR 300 trillion will be a partner of INA," he said.
Furthermore, said Sri Mulyani, the target was set conservatively. He hopes that these achievements can be higher in the coming years with more maturity and readiness of INA.
According to Sri, INA has already received initial capital from the government. He added that this capital will gradually reach IDR75 trillion. The government has injected IDR 15 trillion in funds by 2020. The government will again inject IDR 15 trillion in capital from the APBN and inbreng shares from BUMN this year.
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The Minister of Transportation offered the LRT project to the port being funded by INAMinister of Transportation Budi Karya Sumadi admitted that he has swallowed a long list of projects that could be financed by INA. According to Budi, this series of projects has a big impact on society and has the potential to provide attractive returns. However, the government budget is not sufficient to finance it.
This is to support the acceleration of strategic development in the transportation sector. The Ministry of Transportation for SWF has prepared a potential project that needs to be built and cannot rely on a pure state budget, "he said.
First, the projects it will offer come from the port transportation sector. Among them are the Garongkong Seaport in South Sulawesi, the Sea Port in Ambon to Palembang.
"Like the Garongkong Port of South Sulawesi, the New Ports in Ambon and Palembang are currently developing our FS (feasibility studies) as a solicited project," he said.
Second, originating from air transportation projects, including airports in Fakfak and Manokwari, Papua, airports in Mentawai, West Sumatra to Mandailing Natal, North Sumatra.
"In Aceh, on Banggai Island, Central Sulawesi, on Sabu Raijua Island, NTT, which he said is the most beautiful island in the world, we also build Seaplane in Ambon and Kangean, Weda Airport and Taufiq Kiemas Airport," he said.
Then, the Ministry of Transportation will offer Mass Rapid Transit (MRT) and Light Rail Transit (LRT) projects in Bali, Medan, Bandung, Makassar and Surabaya.
"LRT and MRT in Bali, Medan, Bandung, Makassar, Surabaya. Bus terminals in all major cities," he explained.
Jokowi wants INA to go globalPresident Joko Widodo (Jokowi) hopes that the Investment Management Institution, known as INA, can become a world-class Sovereign Wealth Fund.
"With a strong legal foundation and political support as well as Dewas and a great board of directors and a strong international network, I believe INA will gain national and international trust and be able to make INA a world-class Sovereign Wealth Fund," Jokowi said when introducing the ranks of Dewas Pengawas. and the LPI Board of Directors at the Merdeka Palace, Jakarta, Tuesday, February 16.
The former Governor of DKI Jakarta also hopes that other ministries / state agencies can fully support INA's presence.
"It must be innovative, it must have the courage to take decisions that are out of the box with good governance. Indonesia must have adequate alternative financing for acceleration towards an advanced Indonesia," he said.
For your information, SWF is an institution that manages state financial assets or a fund manager formed by the government as a state-owned investment vehicle for long-term and low-risk investment purposes in various fields, including real estate and infrastructure.
SWF Indonesia or the Investment Management Institution (LPI) was formed under the name Indonesia Investment Authority (INA) and its board of directors was approved by the President of the Republic of Indonesia Joko Widodo on February 16, 2021.
INA is the mandate of Law Number 11 of 2020 concerning Job Creation and its derivative regulations such as Government Regulation (PP) Number 74 of 2020 concerning Investment Management Institutions (LPI).
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