Airlangga Hartarto: Japan And The United States Are Ready To 'Plant Money' Of IDR 84.6 Trillion At SWF INA

Coordinating Minister for Economic Affairs, Airlangga Hartarto. (Photo: Coordinating Ministry for Economic Affairs)

JAKARTA - The Coordinating Minister for Economic Affairs Airlangga Hartarto said there were two countries that were willing to invest in a soverign wealth fund (SWF) or the Indonesian Investment Management Institute (LPI) called the Indonesia Investment Authority (INA) with a value of 6 billion US dollars or equivalent to Rp84. , 6 trillion (exchange rate Rp. 14,100).

The first country is Japan through the Japan Bank for International Cooperation (JBIC) with an investment value of 4 billion US dollars or around IDR 56.4 trillion (exchange rate of IDR 14,100), and from the United States through the International Development Finance Corporation (DFC) worth 2 billion US dollars. or around IDR 28.2 trillion.

"The commitment given by various Japanese countries, DFC and from the US, is a base effort of 2 billion and JBIC 4 billion, so a minimum of 6 billion has become capital added to that determined by the government," he said, in the 2021 Indonesia Economic Outlook Webinar, quoted from YouTube. The Indonesian Economy, Tuesday, December 22.

As is known, the government this year has budgeted IDR 15 trillion from the state budget as initial capital for the institution. The LPI's initial capital is a form of separated state assets. Overall, the government has set the LPI's capital to be IDR 75 trillion.

Director General of State Assets at the Ministry of Finance, Isa Rachmatarwata, said that meeting the capital requirement could be by using other state assets to state-owned shares.

"Regarding capital, this year, God willing, it is budgeted for IDR 15 trillion in 2020, the rest in accordance with the PP will be fulfilled in 2021," Isa explained in a virtual media briefing, Friday, December 18.

Previously, Isa said, LPI was targeted to be operational in early 2021. The mission is to maximize capital plus economic development.

"The LPI is targeted to start operating in early 2021, of course after the implementing regulations are ready," he said in a virtual discussion, Wednesday, December 2.

Isa said, LPI has three main tasks, the aim of which is to generate the maximum possible revenue. First, by maximizing assets for growth and protection of the country's wealth.

"For example, the investments obtained include China Investment Corp. and Korea Investment Corp. Then, the balancing of future / intergenerational investment wealth, such as the Kuwait Investment Authority. Finally, funding future liabilities such as the New Zealand Super Fund and others," he said.

Second, the LPI will also concentrate on national development. This is because one of the goals of establishing the LPI is to build the country. The types of projects can vary, from those that are commercially visible to those that are not visible.

Meanwhile, projects that are not visible, for example, are projects of a social nature, such as the Mudabala Development Company.

Finally, the LPI will also serve in the interests of economic stabilization. So that the LPI will support countercyclical policies to help reduce the burden on the government in every policy taken.

"For example, facilitation of fiscal stability such as the Chile Economics and Social Stabilization Fund. Or rupiah exchange rate stability such as the Russian Reserve Fund," he said.