Inauguration of Danantara as an Economic Power for Indonesia’s Future
By: Rizki Ramadhan
Indonesia is entering a new era in national investment management with the establishment of the Danantara Investment Management Agency (BPI). This structure is designed as a manager of strategic state-owned assets to strengthen the long-term economy. This step is not just a restructuring, but a comprehensive strategy based on regulations to optimize state resources.
President Prabowo Subianto emphasized that Danantara is a form of consolidation of all economic strengths under the control of State-Owned Enterprises (BUMN). With a name that means Daya Anagata Nusantara, this institution is expected to be the driving force of the economy through the management of investment funds and state assets for the future of Indonesia.
The establishment of Danantara is based on Law Number 11 of 2020 concerning Job Creation and is strengthened by Government Regulation Number 73 of 2021 concerning the Investment Management Agency.
This legal umbrella provides a strong foundation in the institutional structure and mechanism for managing investment funds. Its implementation has become more evident after the ratification of the Draft Law on the Third Amendment to Law Number 19 of 2003 concerning BUMN in the Plenary Meeting of the Indonesian House of Representatives on February 4, 2025.
With the value of BUMN assets reaching 1 trillion US dollars or around 60 percent of Indonesia’s Gross Domestic Product (GDP), optimization of its management is a must. The right leverage in the investment market is believed to be able to increase economic growth sustainably.
Based on IMF research in 2020 regarding Sovereign Wealth Funds (SWF) and long-term economic growth, effective management of investment funds contributes significantly to the stability of the country’s economy.
The concept of superholding as implemented by Danantara has long been a discourse in the institutional transformation of BUMN. The application of this model is motivated by the need to diversify sources of state revenue.
Dependence on the oil and gas and mining sectors poses a high risk due to fluctuations in global commodity prices. Therefore, Danantara’s investment is directed at sustainable projects with broad economic impacts, including advanced manufacturing, food production, renewable energy, and downstream industries.
Public policy observer from the National University, Ansori Baharudin Syah, assessed the formation of Danantara as a strategic step in managing state assets to be more effective and have high investment value.
Through this structure, assets that were previously spread across various BUMNs are more focused in their use. The impact is not only to increase profitability for BUMNs that are included in it, but also to contribute to overall national economic growth. Investment profits from Danantara are reallocated for community welfare, creating a wider positive chain effect.
In addition, Ansori also emphasized that the existence of Danantara increases Indonesia’s economic competitiveness at the global level. With more productive asset management, Indonesia has the opportunity to attract greater foreign investment.
Currently, the value of foreign investment in Indonesia is still lagging behind other countries, with an average of not exceeding 100 US dollars per capita, while Vietnam has reached 400 US dollars per capita. The increase in foreign investment entering Indonesia is an indicator of Danantara’s success in creating a more competitive investment climate.
Member of the President and Vice President’s Economic Team, Laode Masihu, saw that BUMN reform through Danantara emphasized asset optimization, professionalism, and orientation towards economic growth.
The main benchmark used is a management model such as Temasek Holdings in Singapore and China Investment Corporation. Both institutions have proven to be able to manage state investments efficiently with sector diversification strategies and transparent governance.
Several strategic steps need to be implemented so that Danantara can achieve these goals. First, increasing management capacity by recruiting competent experts in the field of global investment.
Second, implementing good governance principles by ensuring transparency and accountability. Third, developing a diversified investment portfolio to reduce risk.
Fourth, implementing sustainable investment principles by considering environmental, social, and governance (ESG) aspects. Fifth, building strategic partnerships with global SWFs and international investors to increase investment networks.
