Investment Minister Comments on SoftBank Withdrawal from New Capital Project

TEMPO.CO, Jakarta - Coordinating Minister for Maritime Affairs and Investments Luhut Binsar Pandjaitan on Tuesday commented on the departure of SoftBank as a potential investor in the construction of Indonesia's new capital city, Nusantara. 

He explained that the government had been informed about SoftBank pulling back from the project for some time. Luhut claimed that the falling shares of the Japanese firm was the reason behind its withdrawal. 

“SoftBank since the beginning withdrew since their shares dropped. They then had a vision fund that was not placed into Saudi, not Abu Dhabi [but for the new capital],” said Luhut at Central Jakarta’s Grand Hyatt on March 15. 

Back in 2020, Minister Luhut announced that SoftBank was interested in investing in the construction of Indonesia’s new capital in East Kalimantan. The government had even appointed SoftBank CEO Masayoshi Son as the head of the new capital steering board along with Tony Blair and Abu Dhabi’s Mohamed bin Zayed Al Nahyan. 

Luhut said at the time that the investment value offered by the Japanese firm was too large, adding that US$25 billion would suffice as the city relocation plan had commenced. 

Last week, SoftBank officially confirmed that they will not participate further with the plan but said they will continue to invest in Indonesia through a portfolio of companies in SoftBank Vision Bank in other sectors. 

Luhut said the government has attracted various investment commitments for IKN to replace SoftBank. US$20 billion worth of commitments will come from Abu Dhabi and Saudi Arabia. "Abu Dhabi will enter later through the Sovereign Wealth Fund," said Luhut. 

Read: Jokowi Calls for Agility of New Capital Authority in Obtaining Funds

FRANCISCA CHRISTY ROSANA