Indonesia decides to move capital off Java but reveals no location

30, Apr. 2019

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By Christine T. Tjandraningsih

JAKARTA, Kyodo - The Indonesian government decided Monday to relocate the nation's capital from Jakarta to somewhere outside the densely populated Java Island, a Cabinet minister said.

National Development Planning Minister Bambang Brodjonegoro said the capital will be moved somewhere in central Indonesia within five to 10 years but declined to reveal its location out of concern announcing it now would spark speculative land buying and a spike in land prices in the area.

The decision at a Cabinet meeting chaired by President Joko “Jokowi” Widodo came after considering economic losses caused by traffic congestion in the capital that reached 56 trillion rupiah (about $4 billion) a year based on 2013 data, Bambang said.

“It has even been approaching 100 trillion rupiah a year this year as the traffic congestion in Jakarta is getting worse,” the minister said, adding that the low-lying capital is also prone to floods.

While its location is being withheld, the new capital is believed to be built in an existing city that already has an airport, harbor and other pieces of infrastructure.

Bambang said that although such institutions as government agencies, parliament, national police headquarters and the constitutional court would move to the new capital, Jakarta would continue to host such institutions as the central bank and the investment coordination agency so the mega city would remain the nation's economic center.

The new capital, the minister said, is expected to be “geographically strategic” and located in the center of the country's territory to represent justice and accelerate development, particularly for the least-developed eastern part of Indonesia.

“The area must be free from earthquake, volcanic eruption, tsunami, flood, erosion, and forest and peatland fires,” he said.

The idea to move the capital has been proposed since the era of President Sukarno, the nation's first president, but the plan has never materialized.

In 2017, Jokowi instructed Bambang to study the plan.

“Moving the capital needs well-planned, detailed preparations,” Jokowi said at the start of Monday's Cabinet meeting, suggesting he plans to spend an extended period of time finalizing the relocation site.

“But I believe, Insya Allah (God willing), if we prepare it well, we can materialize this big idea,” he said. (Kyodo)