Indonesia's Danantara Sovereign Wealth Fund Poised to Launch
Indonesian President Prabowo Subianto announced the imminent launch of a new sovereign wealth fund, Danantara, on February 24th. The fund, with an initial cash investment of $20 billion, aims to invest across industries and boost the country's economic growth to 8%.
Danantara, which will manage an estimated $900 billion in assets, will prioritize investments in renewable energy, advanced manufacturing, downstream industries, and food production. President Subianto expressed confidence in the fund's ability to generate significant value and attract foreign direct investment.
This announcement follows parliamentary approval of legislation enabling Danantara to oversee state-owned companies. The fund will be led by Muliaman Hadad, a former Bank Indonesia deputy governor.
However, experts question the feasibility of managing such a large asset pool and the potential impact on the governance of existing state-owned assets. The Indonesia Investment Authority, a precursor fund, currently has less than $10 billion under management.
The fund's operations and regulatory framework will become clear in the coming months.