Indonesia to allocate $2.7 billion next year to construction of new capital

JAKARTA (Reuters) -Indonesia is to allocate 40.6 trillion rupiah ($2.7 billion) to the construction of its new capital city in its 2024 budget and the presidential office and a dozen apartment blocks for workers should be completed next year, ministers said on Wednesday.

The Southeast Asian nation announced in 2019 that it would build a new capital, Nusantara, on Borneo island, replacing an overcrowded and sinking Jakarta. The new city is expected to cost a total of $32 billion by the time it is completed in 2045.

The government has already invested 32 trillion rupiah to build basic infrastructure, including a dam and a toll road.

Finance Minister Sri Mulyani Indrawati said 35 trillion rupiah from the 2024 budget would be given to the public works and housing ministry, who will build infrastructure and housing for civil servants.

“Supporting infrastructure will be finished in 2024,” Sri Mulyani said at a news conference.

The government will in September start building housing for about 16,000 civil servants, military and police officers, who are due to move in next year, said public works and housing minister Basuki Hadimuljono.

The government plans to complete 12 of 47 apartment blocks by July next year, a month before the government will hold its first independence day flag ceremony in the new capital, Basuki said.

“Four coordinating ministry’s offices, the presidential palace will be complete next year, while the field for flag-raising ceremony next year will be complete in July,” he said.

($1 = 15,285.0000 rupiah)

(Reporting by Bernadette Christina and Stefanno Sulaiman, Ananda Teresia; Editing by Martin Petty and Conor Humphries)