March 16, 2023
SINGAPORE – Indonesia plans to build first-class hospitals and universities in its new capital city that is being developed in Borneo, and President Joko Widodo hopes Singapore investors will partner his country on this front.
Speaking to The Straits Times on Wednesday ahead of his meeting with Prime Minister Lee Hsien Loong in Singapore for their regular leaders’ retreat on Thursday, Mr Widodo outlined his plans for the flagship project, known as Nusantara.
The development is envisioned as a sustainable, smart city to relieve Jakarta’s overcrowding and congestion issues. Some government ministries and institutions will be relocating there in phases from 2024.
Mr Widodo stressed that it is important for the two neighbours with “very long and close relations” to explore new areas of economic growth, especially after the Covid-19 pandemic.
“Singapore is the most important partner for Indonesia,” he said. “The relationship between Singapore and Indonesia is very good and must be continued and improved in the future.
“We hope investments in Nusantara can become the focus.”
The 2,561 sq km project, about three times the size of Singapore, is estimated to cost 466 trillion rupiah (S$41 billion). The state will bear 20 per cent of the costs, while Indonesia hopes the private sector will foot the rest.
Nine hospitals and seven universities, some involving foreign partnerships, have expressed an interest in establishing a presence there so far, the President said.
With a broad smile and a twinkle in his eye, Mr Widodo said he hopes Singapore hospitals such as Mount Elizabeth and Gleneagles, and its universities, will do the same, dangling a reminder about the various incentives which have been prepared, including tax holidays and the provision of longer land rights.
“Indonesia’s economy is also in a good position. There are many potentials that can be explored,” he said in an exclusive interview with ST at the presidential palace in Jakarta over a nasi padang lunch.
Infrastructure such as the presidential palace and government buildings in Nusantara is expected to be ready by the second quarter of this year, after which investors could start building hospitals, universities and hotels, he said.
Mr Widodo also acknowledged that the project has its challenges and speed bumps. “We want to move quickly, but land clearing takes time.”
The Indonesian leader, better known as Jokowi, said he planned to speak about the development of the new capital at the leaders’ retreat.
His plan to invite a large group of Singapore investors to attend a presentation on the capital fell through “because things on the ground are not ready yet”.
But if there is a roadshow planned, “Singapore will be the first place we will go to”.
The President added that he has many personal friends in Singapore. This includes PM Lee, whom he regards as a “good old friend”.
“We are really close, and have been friends for a long time. We have never had any problems, not even small ones, much less big ones. We always talk about positive things for the future.”
Both his sons Gibran Rakabuming Raka and Kaesang Pangarep had studied in the Republic. His favourite food is Hainanese chicken rice, he said with a thumbs up.
“Shiok ah,” he declared, drawing laughs from everyone in the room.
Collaborations in new areas will be discussed at the leaders’ meeting on Thursday, he said, adding that the progress of the outcomes of the last retreat on Indonesia’s Bintan Island in January 2022 will also be reviewed.
Mr Widodo said he was pleased with Indonesia’s ratification of three longstanding bilateral agreements on airspace management, defence cooperation and extradition, all within the past year.
Two pacts – the Defence Cooperation Agreement and the Treaty for the Extradition of Fugitives – had been signed in April 2007 under the leadership of former Indonesian president Susilo Bambang Yudhoyono and PM Lee, but were ratified by Indonesia only in December 2022.
The defence deal allows for the Singapore Armed Forces to train and take part in exercises in Indonesia with full respect for Indonesia’s sovereignty over its territory, while the extradition treaty supports the handing over of fugitives between the two countries.
The third, the Flight Information Region (FIR) agreement, ratified in September, provides for the boundary between the Singapore and Jakarta FIRs to be realigned to be generally in accordance with Indonesia’s territorial boundaries. Indonesia will also delegate the provision of air navigation services for a part of this realigned airspace to Singapore for 25 years.
Mr Widodo said the key to ratifying these agreements on longstanding issues was open communication to ensure clarity among the various ministries and the Parliament in Indonesia.
“We don’t explain it once, twice or thrice. I urged all ministries to be transparent, and the process then moved really fast. MPs who had earlier rejected the agreements have all agreed now,” he said. “We are now focusing on follow-up and implementation, one by one.”