Jakarta. President Joko “Jokowi” Widodo’s goal of constructing a new capital city from scratch to save the traffic-clogged and sinking Jakarta has caught many people's attention in 2023.

Infrastructure-wise, the capital relocation witnessed some progress as the construction of hotels and hospitals, among other things, commenced. As Indonesia inches closer to the February election, all eyes are on the three presidential candidates: Prabowo Subianto, Ganjar Pranowo, and Anies Baswedan. The Indonesian people and investors are curious about what these candidates think of the new capital, which approximately costs a hefty $33 billion to build. As Indonesia embarks on a new year, below is a 2023 recap of Indonesia’s one of, if not the most, ambitious infrastructure projects.

Construction Begins for Hotels, Hospitals
The year 2023 saw three phases of groundbreaking ceremonies in Nusantara with the first one taking place in September. Nusantara Consortium -- led by the construction giant Agung Sedayu Group -- started building the five-star Nusantara Hotel. Taxi giant Bluebird Group not long ago began its work to develop the city’s environmentally-friendly transport system of electric taxis. 

Throughout the year, Jokowi launched the construction of 4 hospitals in the new capital that lies in East Kalimantan. The president is even hoping that once the hospitals finish construction, Indonesians no longer feel the need to go abroad for medical treatment.

The following is a summary of the past 3 groundbreaking phases as reported by the Nusantara Authority on Dec. 29:

Groundbreaking Phase 1 (September 21-22)

• Nusantara Hotel (Nusantara Consortium)
• Hotel by Vasanta Group
• Abdi Waluyo Hospital
• Football training center (Indonesian football association PSSI in partnership with FIFA) 

Groundbreaking Phase 2: (November 1-2)

• Hermina Hospital
• Mayapada Hospital
• Bank Indonesia office
• 50-megawatt solar power plant by state-owned electricity firm PLN
• VVIP airport (Transportation Ministry)
• SDN 020 Sepaku Elementary School revitalization project by Astra
• BPJS Ketenagakerjaan head office
• Nusantara Intercultural School
• Pakuwon Nusantara superblock (a shopping center, condominium,  3 hotels)

Groundbreaking Phase 3 (December 20-21)

• Bluebird’s office and transport services (e.g. e-taxi fleet)
• Health Ministry’s hospital
• Reforestation and revitalization projects by the Public Works and Environment Ministries
• Police headquarters
• Military district command office
• The Pakubuwono green apartment buildings 
• BSH Community Hub (3-star hotel, apartment, restaurants)
• Nusantara Superblock (a mixed-use project by Wulandari Bangun Laksana that includes a shopping center and hotels)
• Mini tropical forest project (Aqua)

Jokowi's Back-and-Forth Visits to Nusantara

Jokowi had been going to Nusantara back and forth throughout the year, be it to launch the aforementioned projects or simply to check on existing construction. 

Jokowi’s first Nusantara visit in 2023 took place in February. Jokowi at the time came to see how the construction of the ministers’ housing complex had progressed. The president told reporters then that the ministers’ housing could finish by June 2024 -- ahead of the Independence Day celebrations. 

Subsequent visits by Jokowi followed in September, November, and finally in December. The September visit was unlike any other as the president came with renowned actors and musicians.

Each visit also showed how much the project has progressed so far. As a case in point, Nusantara Hotel was 34 percent complete within three months.

“What matters the most is that there is progress after the groundbreaking ceremony. That we see progress every month,” Jokowi told the press shortly after his visit to the Nusantara Hotel project on Dec. 20.

Jokowi aims to hold the flag-hoisting ceremony of Indonesia’s independence day in August 2024 -- meaning that the palace and office have to be ready by then. This is set to be the last Independence Day celebrations before the two-term president steps down in October.

The presidential palace and office remain under construction. Jokowi made sure to stop by the palace whenever he visited as these projects raced against time. 

The Public Works Ministry revealed not long ago that works for the state palace --as well as the grounds for the flag-hoisting ceremony-- had reached 34.27 percent in progress as of Oct. 26, according to news agency Antara. The presidential office construction is at least 49.75 percent complete.

How Much Has Gov’t Spent So Far for Nusantara?

Constructing a new city --particularly one that boasts state-of-the-art technology -- calls for a substantial investment of $33 billion. Indonesia only intends to use the state budget to cover 20 percent of the costs. The rest will come from the private sector.

Agung Wicaksono, the deputy for investment at the Nusantara authority body, told reporters last week that the government had spent approximately Rp 35 trillion (approximately $2 billion) on the project. Non-state budget funding for the projects that had already begun construction had reached Rp 41 trillion.

There is approximately Rp 55 trillion worth of funding via a public-private partnership scheme in the pipeline to build civil servant housing and townhouses. 

According to Agung, China’s Citic Construction is set to take part in building 60 towers to house civil servants under the Defense Ministry. Malaysia’s Maxim and IJM have shown interest in building civil servant towers.

Agung said the Citic Construction project had recently finished its feasibility study, and it is now undergoing an evaluation process. He, however, refused to reveal the investment value from the Chinese investor.

“[Citic Construction] feasibility study is currently under evaluation by an independent consultant team deployed by the Finance Ministry. … We have to see whether this project can move on to the tender process,” Agung told a press briefing on Friday.

As of Dec. 15, the Nusantara project has attracted 328 letters of intent (LoIs) from investors who wish to invest in the future capital. The investors are mostly Indonesian institutions. But one thing to note is that LoI is just the first step before the project takes shape. The investors have to go through 1-on-1 meetings and feasibility study, among others.

New Logo: Tree of Life

In May 2023, Nusantara unveiled its tree-of-life-inspired logo. Prior to the launch, Indonesians got to pick one of the 5 logos that made it to the final round. 

The winning “Pohon Hayat” (‘Tree of Life’) logo --made by Bandung local and graphic designer Aulia Akbar-- got over 500,000 votes. According to the Nusantara capital authority, the 5 roots symbolize the five-point state ideology Pancasila. The 7 tree trunks represent the 7 major Indonesian islands. The 17 petals are a symbol of Indonesia’s independence day which falls on August 17.

“Pohon Hayat is the tree of life,” Jokowi said when launching the logo on May 30, 2023.

“It will be a life source for all Indonesians in the future,” Jokowi added.

Nusantara and the 2024 Election

Hundreds of millions of Indonesians will vote for the next president in just around 43 days. With Nusantara taking center stage in Jokowi’s current administration, all eyes are now on what the three presidential hopefuls plan to do with the project. 

The respective manifestos by rivaling Prabowo Subianto and Ganjar Pranowo affirmed their commitments to continuing Nusantara should they win the presidential bid. Ganjar became the first presidential candidate to visit the future capital that is locally known by its acronym IKN. 

Anies Baswedan’s manifesto did not mention Nusantara. The former Jakarta governor, however, has been critical of the capital relocation. The Anies Baswedan-Muhaimin Iskandar pairing prefers to upgrade 40 existing cities to be on the same level as Jakarta rather than building an entirely new capital. 

Gibran Rakabuming --Prabowo’s running mate and Jokowi’s son-- recently made his debate debut by promising to carry on the Nusantara project. 

“The continuation of the new capital project will create new epicenters of economic growth, open up access and connectivity, while also generating jobs. Nusantara is not simply constructing government buildings, but it is a symbol of equitable development. The new capital is also the symbol of Indonesia’s development transformation,” Gibran said at the inaugural vice presidential debate in Jakarta on Dec. 22.

A Smart City Blueprint and Flying Cars
The Nusantara Authority wrapped up 2023 by launching a blueprint on how they planned to turn the capital into a smart city. By “smart city”, Nusantara wants to have flying cars, among others. It also wants to deploy unmanned aerial vehicles (UAVs) which can come in case of health emergencies, according to the blueprint.

Indonesia has signed a memorandum of understanding (MoU) with South Korean automotive giant Hyundai to have air taxis flying in the skies of Nusantara. Hyundai is set to conduct trial runs for its air taxis in Nusantara this July, according to the capital authority. Hyundai’s air taxi can carry 5 people, including a pilot.

Talks are also underway to get Wisk Aero, a wholly-owned subsidiary of American air manufacturer Boeing, to deploy its air taxis on the planned capital.

“We are still in talks with Wisk Aero’s Vice President of Asia-Pacific and Air Operations [Catherine Macgowan]. We have had discussions with Boeing Indonesia’s country managing director [Zaid Alami],” Mohammed Ali Berawi, the deputy for digital transformation, told reporters last week.

“Hopefully, we can have the scope of cooperation [with Wisk Aero] this January,” Ali said.

No air taxi in the world to this day has entered a commercial phase.

What’s In Store for 2024?
Indonesia is looking forward to seeing more projects breaking ground this year. As many as 15 investors will launch their respective projects in early 2024. This includes top banks BCA and Mandiri. The Financial Service Authority (OJK) and the state healthcare agency BPJS Kesehatan will start constructing their offices between January and February.

2023 was an eventful year for the Nusantara.  Only time will tell how 2024 will play out for the smart city of Nusantara.