Danantara is a strategic entity that will seek to consolidate and optimize government investment to support national economic growth.
Its vision is to encourage the transformation of the Indonesian economy by growing a global sovereign wealth fund (SWF), supporting national development, and creating prosperity for all Indonesian people.
Here's everything you need to know about the new sovereign wealth fund:
1. Danantara will manage hundreds of trillion rupiah
Initially, Danantara will manage funds worth Rp300 trillion (about US$20 billion) sourced from inefficient, and poorly targeted spending programs.
The funds will be diverted to 20 or more national strategic projects, such as nickel, bauxite, and copper downstreaming projects, data center development, artificial intelligence (AI) development, oil refineries, and petrochemical plants.
They will also be used to finance food and protein production projects, aquaculture, as well as new and renewable energy projects.
It is projected that Danantara will eventually manage assets of more than US$900 billion.
2. Structure of the agency
Supervisor and Person-In-Charge:
President Prabowo Subianto
Advisory Board:
Susilo Bambang Yudhoyono
Joko Widodo
Supervisory Board:
Chairperson: Erick Thohir [Minister of State-Owned Enterprises (BUMN)]
Vice Chairperson: Muliaman D. Hadad
Members of the Supervisory Board:
Sri Mulyani Indrawati (Minister of Finance)
Tony Blair (former UK Prime Minister)
Executive Body:
Chief Executive Officer: Rosan P. Roeslani (Minister of Investment and Downstreaming, Head of the Investment Coordinating Board)
Chief Operating Officer: Dony Oskaria (Deputy Minister of BUMN)
Chief Investment Officer: Pandu Patria Sjahrir
3. The genesis of Danantara
Special presidential envoy for climate and energy, Hashim Djojohadikusumo, said that the idea of Danantara was formulated 40 years ago by his and President Prabowo's father Soemitro Djojohadikusumo.
Soemitro was an economist who served as finance minister in 1952–1953 (Wilopo Cabinet) and 1955–1956 (Burhanuddin Harahap Cabinet).
Soemitro saw the need for an institution that would manage state assets professionally to support economic development. However, his idea could only be realized 40 years later.
4. Effect of Danantara's establishment
The Financial Services Authority (OJK) said that the establishment of Danantara will not affect the quality of services or the security of customer savings at member banks of the State-Owned Banks Association (Himbara).
"The establishment of Danantara does not reduce the quality of banking operations and services, as well as the security of public savings at the bank," the chief executive of banking supervision at the OJK, Dian Ediana Rae, said.
There are three member banks of Himbara whose assets will be consolidated through Danantara—Bank Mandiri, Bank Rakyat Indonesia (BRI), and Bank Negara Indonesia (BNI).
Rae said that the three Himbara banks will continue to operate in compliance with the applicable regulations and uphold the principles of prudence and good corporate governance.
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Reporter: Cindy Frishanti Octavia
Editor: Arie Novarina
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