Indonesia pledges USD55.5bn to modernise Jakarta ahead of move to new capital

  • The Indonesian government is not abandoning Jakarta after announcing plans to move the country’s capital, its planning minister said, pledging to spend USD40bn to save the slowly sinking city in the next decade.
  • The current Indonesian capital will undergo a IDR571tr urban regeneration in the next 10 years, more than the USD33bn expected cost to build a new capital city on Borneo island, Mr Bambang Brodjonegoro told Reuters in an interview.
  • Mr Brodjonegoro said the relocation decision was taken because the government knew the population concentration in Jakarta has to be reduced.
  • The over-extraction makes Jakarta prone to floods and sinking due to subsidence. Rising sea levels aggravated the sinking, with some part of the city dropping as much as 28cm a year, making Jakarta the fastest sinking city of its size globally.
  • Part of the new project submitted by the city government is to extend water pipes to cover all of Jakarta so that people don’t rely on groundwater, Mr Brodjonegoro said.
  • The government will also build a new sewage system, he said.
  • “The biggest chunk of the spending would be for mass transportation, such as lengthening the newly built track for its mass rapid transit (MRT) system.” Mr Brodjonegoro said.

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