JAKARTA (TheInsiderStories) – Senior minister for maritime and investment affairs, Luhut Pandjaitan, said the government has secured a funding commitment from Canada worth of $2 billion in Sovereign Wealth Fund (SWF) Indonesia. So far, the country has pocketed foreign funding commitments $2 billion from International Development Finance Corporation from America and $4 billion from Japan Bank for International Cooperation.
The government has set up an investment management institution through an Omnibus Law for Job Creation and aimed to attract $5 billion of investment through the new body. The former Indonesian Ambassador to Singapore, based on the Government Regulation Number 73 of 2020, the new entity will receive a capital of Rp15 trillion ($1.06 billion) in 2020.
The fulfillment of the SWF Indonesia‘ capital will gradually be carried out until Rp75 trillion in 2021. On Monday, President Joko Widodo has signed three regulation to establish the SWF Indonesia.
The two Presidential decrees are Number 73 of 2020 concerning Initial Capital for Investment Management Institutions and Number 74 of 2020 concerning Investment Management Institutions. Then, the decree Number 128 of 2020 concerning the Establishment of a Selection Committee for the Selection of Candidates for the SWF Supervisory Board from Professional Elements.
Widodo optimistic there are a potential the Sovereign Wealth Fund, creating by the government to manage $20 billion funds after promulgation. The new entity shortly will establish after parliament approve the omnibus law.
The optimism come after government do their effort, approached the potential investors, such as United Arab Emirates (UAE), Japan, Britain, Germany, and United States. He give an example, Japan’ Softbank Corp., founder, Masayoshi Son, has expressed his commitment to invest in the new agency after declared to invest $2 billion in the country in July.
Panjaitan stated, the funds gathered in SWF will utilized for infrastructure projects, including for Indonesia’ new planned capital city. He said, UAE participation at the Fund around $6.8 billion. The minister also revealed, the SWF scheme will serve as government-owned private equity that can be used as investment, especially for infrastructure development.
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