Indonesia: Danantara’s Presence Has a Positive Impact on the Indonesian Economy
By: Nurul Janida
President Prabowo Subianto will launch the Daya Anagata Nusantara Investment Management Agency (BPI Danantara) on February 24, 2025. This agency was formed to manage state wealth investments originating from natural resources and strategic assets for the benefit of the community in the long term. Danantara is expected to be the main pillar in optimizing the management of state assets in a more targeted and efficient manner.
Prabowo emphasized that Danantara is a consolidation of economic strength spread across various State-Owned Enterprises (BUMN). With total assets worth 900 billion US dollars, this agency will act as the main driver in various strategic sectors, such as renewable energy, manufacturing industry development, downstreaming, and food security. The government is targeting economic growth of 8 percent with Danantara’s assistance.
According to the Executive Director of the Center of Economic and Law Studies (Celios), Bhima Yudhistira, said that the presence of Danantara can have a positive impact on the Indonesian economy. One of the expected impacts is the acceleration of financing for the energy transition, including funding for early retirement programs for coal-fired power plants (PLTU) and the development of new and renewable energy (EBT).
Danantara works by managing investment assets through cooperation with third parties. This work scheme is carried out through management powers or other forms of partnership. This agency also has a role in increasing the added value of BUMN operations and processing investments in priority government projects in strategic sectors.
One real example of Danantara’s potential is the assets of PT Perusahaan Listrik Negara (PLN) which will be consolidated to become collateral in financing the energy transition. With this scheme, PLN and other BUMN can obtain greater investment, thereby accelerating the transition to cleaner and more sustainable energy.
Prabowo emphasized that Danantara will become a new economic force that drives investment into sustainable projects. Renewable energy, advanced manufacturing, downstream industries, and food production are priority sectors that will receive funding injections through Danantara.
The government has allocated initial funding of 20 billion US dollars or equivalent to Rp325.8 trillion to support various Danantara initiatives. The funds will be used to initiate around 15 to 20 multi-billion dollar projects that are expected to provide significant added value to the national economy.
The existence of Danantara is also expected to increase Indonesia’s competitiveness at the global level. With more focused and efficient management, this agency can become a strategic partner for domestic and foreign investors who are interested in investing in priority sectors.
In addition, Danantara is expected to be able to create new jobs for the Indonesian people. With massive investments in various strategic projects, this agency can open up job opportunities in the energy, industry, and agriculture sectors, which will ultimately improve people’s welfare.
The government also sees Danantara as a major instrument in supporting the food security program. With the right investment, Indonesia’s agricultural sector can develop more rapidly, increase domestic production, and reduce dependence on food imports.
One sector that will receive special attention from Danantara is industrial downstreaming. By supporting downstreaming projects, Indonesia can increase the added value of natural resource products that have so far been exported mostly in the form of raw materials.
Danantara will also be the main driver in the development of the manufacturing industry in Indonesia. With strong investment support, the domestic manufacturing industry can compete in the global market and reduce dependence on imports of finished goods.
In the energy sector, Danantara will encourage the use of new, renewable energy that is more environmentally friendly. This step is in line with global efforts to reduce carbon emissions and support a more sustainable energy transition.
Danantara is expected to work with various financial institutions and global investors to attract foreign capital into strategic projects in Indonesia. With this cooperation, economic growth can be accelerated.
Prabowo is optimistic that with good management, Danantara can become an institution that provides great benefits to the Indonesian economy. He emphasized that the government will ensure transparency and accountability in the management of this agency.
