JAKARTA - The Nusantara Capital Authority (IKN) believes that the construction of the new Indonesian capital in parts of North Penajam Paser Regency and Kutai Kartanegara Regency, East Kalimantan Province, phase two will further grow the economy of the surrounding area.
"The economic impact is expected to increase in the second phase of the IKN development period (2025-2029)," said Deputy for Planning and Land of the IKN Authority Mia Amalia, quoted by Antara, Saturday, July 4.
The results of the study on the development of the first phase of the new Indonesian capital (2022-2024) conducted by the IKN Authority noted that the economy of North Penajam Paser Regency as the core area of development grew by around 19.9 percent, higher than other districts/cities in East Kalimantan Province.
"The economy of East Kalimantan Province also grew by 3.7 percent, quite high compared to other provinces on the island of Borneo, triggered by government spending and a surge in investment with the construction sector becoming one of the main drivers of the PDRB structure after the IKN construction was underway," said Mia Amalia.
Regional gross domestic product (GDP), according to him, is projected to make a significant additional contribution to the surrounding region, with a sustainable positive impact on economic growth.
The impact of the IKN development is managed from construction activities to strengthening the local supply chain, labor capacity, the involvement of local business actors, and the development of other sectors.
"The projection, he continued, is important in the midst of global geopolitical dynamics and the needs of East Kalimantan Province, strengthening the economic transformation from the extractive sector to a more productive and value-added sector," he said.
According to him, the direction of management is in line with the concept of development through the Nusantara Economic Superhub (SEN) to expand the impact of IKN development in the long term.
"Through the connection of the new Indonesian capital, North Penajam Paser Regency and Kutai Kartanegara, Balikpapan and Samarinda Cities, as well as the surrounding areas, the development of IKN is directed as a new growth center," said Mia.
"The new growth center is directed to boost the economy of East Kalimantan Province," he said, moving towards more productive, value-added and sustainable sectors.
The impact of the IKN development has begun to flow into the surrounding area through the need for goods and services, logistics, accommodation, transportation, trade, and other supporting sectors.
"The IKN development activities have begun to form economic linkages with buffer areas in the Kalimantan Province region," he explained, "not only based on the Central Government Core Area (KIPP) of the new capital of Indonesia.
"The success of IKN is not only measured by the number of buildings, but also by economic growth and the benefits felt by residents around," he added.
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