Indonesia’s new sovereign wealth fund attracts USD10bn commitment

  • Indonesia has received investment commitments of up to USD10bn from global firms for its ambitious sovereign wealth fund, a senior minister said on 26 Jan 21, ahead of its launch expected in 2021.
  • The Indonesia Investment Authority (INA) aims to attract foreign funds as co-investors, unlike other sovereign wealth funds set up by more developed countries to manage oil revenues or foreign exchange reserves.
  • Airlangga Hartarto, Indonesia’s chief economic minister, told a business forum the INA had been promoted among more than 50 global investors and more commitments had been secured.
  • With a target of managing USD20bn, the INA will be seeded by Indonesia’s government with USD5bn in cash and other assets.
  • Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) has signed an informal letter of interest about investing up to USD2bn, alongside an up to USD1.5bn commitment from Dutch pension fund APG, the minister’s presentation showed.
  • Also listed was Singapore sovereign wealth fund GIC, while Australia’s investment bank Macquarie has offered to manage a toll road fund and could contribute another USD300mn, the presentation showed.
  • Indonesia has previously reported investment interest of up to USD6bn by the U.S. International Development Finance Corporation and Japan Bank for International Cooperation.
  • Airlangga said the Abu Dhabi Investment Authority (ADIA) had also been approached.
  • The fund’s supervisory council will include finance minister Sri Mulyani Indrawati and state-owned enterprise minister Erick Thohir.

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