ANKARA
Indonesian President Joko Widodo on Monday announced that his country's capital will be relocated to the island of Borneo due to environmental degradation and overpopulation.
The location of the new capital will straddle two districts -- Penajam Paser Utara and Kutai Kartanegara -- in East Kalimantan Province.
The construction of the new capital is likely to begin in 2021, and the relocation is expected to begin in 2024.
But, the president must need to get the approval from lawmakers. Widodo is planning to submit a bill along with the result of a feasibility study to the country’s parliament.
Main three reasons
The president explained three main reasons behind the relocation of the capital from Jakarta.
1. Population and traffic jam
Jakarta is one of the world's most densely populated cities, home to more than 10 million people. The population of the capital is expected to exceed 35 million by 2030. It is also one of the top traffic congested cities in the world.
The National Development Planning Agency (Bappenas) has estimated that traffic congestion in Jakarta caused economic losses of about Rp. 67.5 trillion ($4.73 billion) in 2017.
2. Economic reason
At present, 58% of Indonesia's gross domestic product is produced on the island of Java, where Jakarta is located. Moving the capital can bring new economic growth in Kalimantan, and protect Java as a center for food security.
According to the president, Jakarta will continue to be developed as a regional and global hub for business, finance, trade and service.
3. Natural disaster
The city of Jakarta is prone to floods and is sinking due to subsidence, caused by millions of residents using up groundwater. 40% of Jakarta lies below sea level, and in 2050, one-third of the capital is likely to be submerged.
East Kalimantan has minimal and limited risk of natural disasters, including floods, earthquakes, tsunamis, forest fires, volcanoes, and landslides.
The new capital will be established with the motto of a green and smart city.
Cost of relocation
The relocation is expected to cost 466 trillion rupiah ($32.79 billion) of which the state would fund 19%, with the rest from public-private partnerships and private investment. Indonesian government expects the private sector to contribute in order to reduce the cost.
