Research Briefing | Feb 23, 2022

Capital move not likely to threaten Jakarta’s economic importance

The Indonesian government has ambitions to move the country’s capital away from Jakarta to an as-yet unbuilt city over 1,000km away on the island of Borneo. The construction of the new city, to be named ‘Nusantara’, is planned to start in 2022 with government operations and personnel beginning to relocate from 2024. Should the move go ahead, we think it is unlikely to be a significant economic threat to Jakarta.

What you will learn:

  • The main motivations for the move are to ease the urban and environmental pressures on Jakarta.
  • Should the move go ahead, we think it is unlikely to be a significant economic threat to Jakarta.
  • Land subsidence, however, is a more substantial threat to Jakarta with the possibility in the coming decades of large swathes of the city coming under water, displacing people and businesses. In our baseline forecasts, enough preventative measures are introduced to avoid this and we project Jakarta’s economy to grow on average by 5.1% a year, 2022-2040.
Back to Resource Hub

Related resources

Post

Australia: Roadblocks cleared for build-to-rent in Australia

The pipeline of build-to-rent (BTR) developments across Australia continues to swell, with our project tracking currently capturing a pipeline of circa 45,000 announced units. Around 5,900 units have broken ground in FY2023, with a further 15,000 geared to commence across FY2024 and FY2025.

Find Out More
Modern office building

Post

How bank turmoil is impacting APAC commercial real estate credit

Recent bank funding turmoil is likely to lead to tighter lending conditions in commercial real estate markets in the Asia-Pacific region.

Find Out More