Indonesia president formally proposes relocating capital to Borneo

Indonesia president formally proposes relocating capital to Borneo

Indonesian President Joko Widodo smiles at reporters as he arrives before delivering a speech ahead
Indonesian President Joko Widodo smiles at reporters as he arrives before delivering a speech ahead of Independence Day, at the parliament building in Jakarta, Indonesia, Aug 16, 2019. (Photo: Reuters/Willy Kurniawan) 

JAKARTA: Indonesian President Joko Widodo on Friday (Aug 16) formally proposed to parliament a plan to move the country's capital from Jakarta, on the crowded island of Java, to Kalimantan on the island of Borneo.

Widodo made the proposal during his state of the union speech at parliament, a day before the country celebrates its 74th independence anniversary.

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"I hereby request your permission to move our national capital to Kalimantan," said Widodo, who will be sworn in for a second term in October after winning April's election.

"A capital city is not just a symbol of national identity, but also a representation of the progress of the nation. This is for the realisation of economic equality and justice," he said, without specifying the exact location for the new capital.


The Indonesian leader also vowed to do more to develop downstream industries to process natural and mineral resources domestically in efforts to bolster the country's economy. 

Widodo listed minerals such as bauxite and nickel, as well as coal, palm oil and fisheries, as the type of resources Indonesia should process more of onshore to increase their value before exporting.

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Indonesia is a major exporter of resources such as nickel ore and talks of expediting a mineral export ban due in 2022 sent London nickel prices to a 16-month high earlier this month, while Shanghai nickel hit a record high.

"We need disruptive innovations that are turning impossibilities into opportunities," Widodo told the parliament.

A downstream bauxite industry was needed to slash imports of alumina, while processing coal to dimethyl ether gas would replace imported liquefied petroleum gas (LPG), he said.

"We are building a downstream industry for nickel to make ferronickel, so its value can increase by four times," he added.

Widodo's ministers said the president has asked for input from his cabinet on possibly moving forward a ban on the export of unprocessed ores from 2022, and that he is expected to decide "some time in the future".

The president also said Indonesia should be able to develop fuel made from 100 per cent palm oil as well as jet fuel made from palm oil.

"We have produced our own jet fuel, but we can do more than that, we can export jet fuel and we also want to produce palm-based jet fuel," he said.

The government wants to expand the use of palm oil into the energy sector to absorb excess supply amid sluggish global demand for the vegetable oil, while addressing the country's energy needs.

During the speech, Widodo, who is due to start his second term in October, also repeated promises to continue regulatory and bureaucratic reforms.

Government institutions that have similar roles will be merged and inefficient civil servants will be removed, he said.

The president, however, said some areas require tighter rules as a response to advances in technology, including on data protection due to cybercrime.

"Data is the new type of wealth for our nation, it is now more valuable than oil," he said. 

Source: Reuters/ad