Indonesia launches Danantara to boost economy
The Indonesian president, Prabowo Subianto, officially launched Indonesia's new sovereign wealth fund, Daya Anagata Nusantara, commonly known as Danantara. This strategic initiative aims to manage state assets exceeding US$900 billion, positioning Danantara among the world's largest sovereign wealth funds.
Danantara's primary objective is to stimulate Indonesia's economic growth, with an ambitious target of achieving an 8% growth rate during President Prabowo's first term. The fund plans to invest an initial US$20 billion in over 20 high-impact national projects across sectors such as renewable energy, manufacturing, infrastructure, artificial intelligence, and food production.
Structurally, Danantara will function both as an investment vehicle and a holding company for strategic state-owned enterprises (SOEs). Notably, significant SOEs like Bank Mandiri, Pertamina, PLN, and Telkom Indonesia will be transferred from the Ministry of State-Owned Enterprises to fall under Danantara's management. This consolidation aims to enhance the efficiency and global competitiveness of these entities.
The leadership team of Danantara includes Investment Minister Rosan Roeslani as the Chief Executive Officer and Pandu Sjahrir heading the investment unit. Their combined expertise is expected to drive the fund's strategic vision and operational success.
To finance Danantara and other key initiatives, President Prabowo has implemented cost-cutting measures across various government ministries, resulting in nearly US$20 billion in savings during the first 100 days of his administration. These austerity measures have sparked public debate, especially concerning potential impacts on social programs.
Transparency and governance are central to Danantara's operations. President Prabowo has emphasized that the fund will adhere to international governance standards and has invited public scrutiny, stating that Danantara's financial activities are open to audits by any party. This commitment aims to build public trust and ensure the fund's integrity.
