The Investment Management Agency Daya Anagata Nusantara (Danantara) is touted to become the driving force of Indonesia’s economy after the state budget (APBN). The head of BPI Danantara, Muliaman Hadad, explained that the agency was established, among other reasons, to optimize state assets to drive Indonesia’s economic growth. “So, [Danantara] will become the second engine after the APBN. There is economic movement because of the APBN, and there is economic movement because of consolidation and leverage.” “So hopefully the desire to achieve high growth can be [realized],” said Muliaman when met at the Fairmont Hotel Jakarta, Thursday (29/11/2024).
He explained that Danantara will later consolidate the separated state assets, and then optimize or leverage them to drive national economic growth. Muliaman elaborated that there are many forms of leverage that can be undertaken by the management body.
“This leverage can take various forms. Because with the merger, the economy of scale can be larger. If the economy of scale is large, it can issue bonds much more cheaply, and efficiency can also be more assured. So there are many things that can be done with consolidation,” he explained.
Therefore, Muliaman stated that Danantara must be managed professionally, transparently, prioritizing the principles of Good Corporate Governance (GCG), and is expected to become a credible partner for both domestic and foreign investors.
Muliaman revealed that the regulations regarding Danantara are currently being prepared and are expected to be completed by mid-December.
Furthermore, he said that Danantara will eventually take the form of a combination of Singapore’s Temasek Holdings and Malaysia’s Khazanah Nasional Berhad.
For your information, Temasek Holdings is an investment management company that acts as an investor and an active shareholder. However, Temasek is not a Sovereign Wealth Fund (SWF), as this company primarily invests in the form of equity, directly owns a number of assets and companies, and pays taxes like other commercial investment companies.
Meanwhile, Khazanah Nasional Berhad is a Sovereign Wealth Fund (SWF) owned by the Government of Malaysia. This country’s SWF is one of the largest in the world and was established to invest Malaysia’s surplus revenue.
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