Indonesia inaugurated a new sovereign wealth fund—Daya Anagata Nusantara, or Danantara—to manage state assets reportedly worth over $900 billion.

The initiative, modeled after Singapore’s Temasek, is part of President Prabowo Subianto’s broader strategy to boost the country’s annual growth from 5% to 8%.

At the presidential palace in Jakarta, Prabowo signed the decree, stating, "I, as the president of the Republic of Indonesia, sign... the government decree... about the organization and governance of the Investment Management Body, Daya Anagata Nusantara."

He further emphasized, "It is not just an investment body, it is an instrument for national development that will optimize the way we manage our wealth. We are committed to being a developed nation."

With an initial budget of $20 billion, Danantara will assume control of various state holdings, although the specific companies have yet to be announced.

'A new era'

Investment Minister Rosan Roeslani has been named chief executive of the fund. Despite current state-owned enterprise assets being valued at $637.5 billion as of 2023, Prabowo envisions the fund managing assets exceeding $900 billion, with plans to "be invested in 20 or more high-impact national projects" this year.

These projects span sectors such as nickel, bauxite, copper, food production, renewable energy, and the development of facilities including an AI center, oil refinery, and petrochemical factory.

Described as Indonesia’s second sovereign wealth fund after the Indonesia Investment Authority (launched in 2021 with $10.5 billion in assets), the launch marks what presidential secretariat spokesperson Yusuf Permana called, "This event marks a new era in the transformation of strategic investment management in the country."

He added that it aligns with the government's commitment to "a grand vision aimed at elevating Indonesia’s economy to a higher level through sustainable and inclusive investments."

However, the announcement has coincided with widespread protests across several cities—sparked by previous government austerity measures—and social media criticism.

One social media user questioned, "The state can't even manage life insurance properly. How can it manage a Danantara-style Sovereign Wealth Fund?"

Critics and experts alike stress that the fund will require rigorous oversight to prevent potential governance issues.

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