A Big Relocation Pause: Indonesia Scrubs the Capital Move to Plow Money into Pandemics
When you hear that Jakarta’s capital‑city move is on cold storage, you’d expect a vague “we’ll do it later” line. But Indonesian Finance Minister Sri Mulyani Indrawati gave a bit more context: the gigantic $33 billion plan to shift the nation’s bustling capital off Java to the quieter island of Borneo has halted, courtesy of the COVID‑19 crisis.
Why the Great Capital Move Got the Golden Ticket… Then Took a Timeout
- Parliament still needs to give the green light for the relocation—no “congrats” yet.
- The government has dipped into the budget for land buying, but the rest of the funds have been redirected.
- Hospitals are getting the funding boost that the capital‑city project was supposed to help pay for.
Official Point of View
“We’ve reallocated most of the Public Works Ministry’s spending—especially the parts earmarked for infrastructure—to beef up our COVID response,” Sri Mulyani said during a video briefing, highlighting how the pandemic has forced a shift in priorities.
Still Wrapping Tenders, Despite the Pause
The Planning Ministry keeps marching forward: a tender is in the works for the masterplan of the new city—yet to get a catchy name—in East Kalimantan, near the port city of Balikpapan. This remote spot was hand‑picked for its low risk of natural disasters, a longing for more peaceful living compared to Jakarta’s traffic jams and flood threats.
The minister told reporters, “I asked President Joko Widodo if we could carve out some budget for 2021 an – he said, with the current situation, we must be cautious.” She added a hopeful twist, “But if the project can bolster economic recovery and instill confidence, why not give it a shot?”
Chronology That’s Stalled
- Original plan: Parliament approves this year, basic construction starts, citizens pack up, and the move is complete by 2024.
- Reality: The pressing need for healthcare and welfare has stolen the money, delaying the capital relocation until next year, at worst.
Meanwhile, Jakarta—currently home to 10 million souls—continues to battle flooding, traffic gridlock, and lurking earthquake dangers. It’s not a surprise the government is looking for a safer, quieter location.
Coronavirus Current Snapshot
COVID has already infected 7,775 people and claimed 647 lives across Indonesia. With the nation’s attention on the health crisis, the capital shift got shelved—at least for now.
