Is Indonesia’s New Sovereign Wealth Fund Danantara a Golden Opportunity or a Risky Affair?
On 24 February 2025, Indonesian President Prabowo Subianto was joined by two former Indonesian presidents (Susilo Bambang Yudhoyono and Joko Widodo) when he launched Danantara, Indonesia’s new sovereign wealth fund. Likely, the presence of two former presidents served to underline the historic significance of this launch as well as underscoring broad-based political support for the move.
As usual, it took a bit longer than expected to launch Danantara as this fund had to be imbedded in the regulatory framework. This particularly involved the issue of the fund assuming certain state-owned enterprise (SOE) management functions, which required an amendment. However, following the third amendment to Law No. 17 of 2003 on State-Owned Enterprises, these hurdles were cleared.
The name Danantara is an abbreviation from Daya Anagata Nusantara, which means the future strength of the Archipelago. In this article we zoom in on the potential and the risks that we associate with this new investment vehicle and super holding.
The Role, Purpose and Assets of Danantara
In essence, Danantara will function as an investment vehicle (similar to Singapore's USD $288.0 billion state-owned multinational investment firm Temasek) sourcing a large chunk of its funds by consolidating the assets of seven big Indonesian SOEs.
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These are the first couple of paragraphs of the article. The full article (14 pages) is available in our February 2025 report. This report (an electronic report, PDF, in English) can be ordered by contacting us through email and/or WhatsApp:
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