Directives of President of the Republic of Indonesia to Regional Heads across Indonesia at the State Palace in the Nusantara Capital, North Penajam Paser Regency, East Kalimantan Province, August 13, 2024

Bismillahirrahmanirrahim.

Assalamu’alaikum warahmatullahi wabarakatuh,

Good morning,

May prosperity be upon us all,

Shalom,

Om swastiastu,

Namo buddhaya,

Greetings of Virtue.

Distinguished Vice President, Ministers who are present, Commander of the Indonesian National Defense Forces (TNI), Chief of the Indonesian National Police (Polri), Deputy Minister;

Distinguished Governors;

Distinguished Regents and Mayors who are present.

I don’t know how you come here, but earlier I asked some of you who had arrived in Balikpapan yesterday or a day before and now you have seen the new capital city, Nusantara. What are your impressions?

Welcome to the Nusantara Capital.

Our palaces in Jakarta and Bogor are former colonial palaces that were once inhabited by Dutch officials. The State Palace was once inhabited by Governor-General Pieter Gerardus van Overstraten. I was surprised to learn that the State Palace and the Merdeka Palace were inhabited by different persons, Merdeka Palace was inhabited by Governor-General Johan Wilhelm van Lansberge. In Bogor, the palace was inhabited by another Dutch governor-general, G.W. Baron van Imhoff. I just want to reiterate that these palaces were once colonial buildings, occupied by former Dutch governors-general, and we have been using them for 79 years. So, the colonial atmosphere is still something I feel daily.

Once again, we want to show that we are capable of building our own capital according to our own vision and design. However, it takes years to complete. It started only two years ago, in 2021/2022, and will take approximately 10 to 15 years to complete. So, it is still a long way to go.

Governors, regents, and mayors have seen that this is just the beginning, it’s not finished yet. Don’t be mistaken, this is far from completion, maybe only about 20% done. Many areas still need to be constructed, not just the core government area with the president and vice president’s offices, ministries, and other buildings. Beside this area, construction work is currently underway, such as hotels, universities, and hospitals. As far as I remember, there are five hotels, with one more has just started construction, making it six. Six hospitals are also under construction. PSSI’s training center is already completed. Several housing properties and other supporting facilities have also started construction.

I just want to say that Nusantara is an example of a future city built with planning and concepts for the future. It is designed as a forest city, not entirely made of concrete. I think every province, regency, and city can plan and design what kind of city they want to build. I’ve mentioned several times that in California, there is a city specifically for golf, with 37 golf courses. That’s all—nothing else. There’s also High Point in North Carolina, which is a furniture city—everything is about furniture. We have great potential in Jepara. Is the Regent of Jepara here? It can be designed from the beginning, even if it’s not completed within one or two terms of a regent, but the planning should be done, detailed and well-thought-out.

We are also designing a smart city, where technology supports all activities. The timing is right, as this era is full of technological changes, digital technology, and others. This will make it a livable city, a comfortable place to live. I believe all our provinces, regions, and cities should aim for that.

Earlier, you saw how a city should have small lakes or reservoirs. These not only add to the beauty but also help reduce the city’s temperature. Around 60 small lakes or reservoirs will be built here. I am still negotiating with the Minister of Public Works to double or triple that number, and it’s possible. It’s not expensive, and the regional budget (APBD) can cover it, but it needs to be planned and designed properly, not just built without care. From an aesthetic point of view, give the responsibility to landscape architects who are capable of building this.

Additionally, in cities near the sea, I urge you not to turn your back on the sea. The sea should be our front yard, not hidden behind buildings. In many beautiful locations in our country, the sea is treated as the backyard, behind buildings.

In the future, green energy will become a trend. This place will use 100% green energy, 100%. Once everything starts, all vehicles will also have to be electric. Yesterday, I checked the air quality index in Nusantara, it was only six. Even though the vehicles are not yet electric, with electric vehicles, it might reach zero. In comparison, Singapore’s air quality index is 53, with the maximum figure for healthy air is 50. In our cities, especially on Java [island], air quality has already exceeded 100. This is something that governors, mayors, and regents must pay attention to.

Solving this issue will also require significant funds. The Minister of Health informed me that poor air quality in the Greater Jakarta area costs us nearly IDR 10 trillion due to respiratory diseases. That’s a lot of money spent on healthcare because of respiratory diseases caused by air pollution in cities.

It’s time to start thinking about how to create mass transportation based on green energy, such as electricity or gas, among other options. Jakarta now has MRT, LRT, and high-speed trains—all of these are aimed at reducing pollution. However, Jakarta’s air quality index is still around 190-200, whereas the maximum should only be 50. Be cautious in cities that are becoming congested and crowded, as pollution primarily affects children and infants, leading to respiratory illnesses.

So, I suggest that if we want to prepare a mass transportation design, there’s something we might consider using here, even though we haven’t decided it yet, namely Autonomous Rail Transit. Regarding the MRT, when we started the MRT project, I was still a governor, and the cost per kilometer at that time, just so everyone knows, was Rp1.1 trillion per kilometer. Is there any governor, regent, or mayor who can afford to build an MRT? Raise your hand. Bali? Be careful. Be very careful with the calculations.

Maybe you can build it, but the operational costs are also significant. Is your regional budget ready? Because anything like MRT, LRT, or high-speed trains, they all incur losses. That means there must be a PSO (Public Service Obligation), and the regional budget must be ready to cover operational costs. Let me give you an example: Jakarta MRT. Every year [the regional government] spends Rp800 billion, it is fully used to cover the MRT costs. Right, Mr. Heru? Rp800 billion, right? Correct. And based on my calculations, when all lines are completed, the regional budget would need to allocate around Rp4 trillion. But what you need to know is that if there were no MRT, LRT, or high-speed trains, we would lose Rp65 trillion every year due to traffic congestion. In the Greater Jakarta area, it might exceed Rp100 trillion. Which would you choose? Would you prefer to spend on MRT, LRT, or high-speed trains, or lose more than Rp100 trillion every year due to traffic congestion? All major cities need to start calculating this.

Now, regarding Autonomous Rail Transit (ART), it is indeed cheaper because it doesn’t require rails, it uses magnets. One unit, consisting of three carriages, costs approximately Rp74 billion. So, earlier, I mentioned that MRT costs Rp1.1 trillion, I forgot that MRT costs Rp1.1 trillion when I was governor, but now it’s Rp2.3 trillion. In ten years, it has doubled to Rp2.3 trillion. The LRT we are building from Bekasi to Cibubur costs Rp700 billion per kilometer, and the high-speed train costs Rp780 billion per kilometer. I remember these figures because I visit the field every day, and I always ask about the standard cost per kilometer.

So, once again, one unit for three carriages costs Rp74 billion. The operational cost per month is Rp500 million. So, cities that are starting to experience traffic congestion, I think, not only in Java [island] but also outside Java, are beginning to face congestion issues. So, it’s time to start thinking about what kind of mass transportation is needed.

Then, secondly.

Oh, I forgot earlier. In the Nusantara Capital, there are already 55 investors who have made investments. In the process of selection and verification, there were 472 Letters of Intent (LoI), which were then verified and  220 of them have been selected, and the selection process is ongoing. Those who have made investments and started construction are investors in education sector, for example universities, elementary schools and high schools construction, there are six; and also three hospitals, ten retail and logistic companies, eight hotels, two energy companies, 14 banks, nine housing companies, and three media and technology companies.

So, I think all of you can follow the concept. If our regional budget isn’t ready, then adopt an investment model. But to attract investment, building trust is the most difficult part. If you believe that your region, your province, your city, or your district has the potential and advantages, but no investors are coming, please evaluate it. There’s likely something wrong, something that needs improvement.

Secondly, regarding inflation. I think it’s been managed well every Monday, led by the Minister of Home Affairs. I want to thank all governors, regents, and mayors, our inflation rate is in a very good position compared to other countries. What’s the latest figure, sir? 2.13 percent, previously 2.58 percent. That’s very good.

But also, please maintain the people’s purchasing power. How? By quickly realizing your regional budget as fast as possible. Because until now, the spending realization in districts and cities is still at 31 percent, which is very low. The money circulating in your districts is very low. If money circulation is low, purchasing power is also weak. Please disburse the funds. Spending realization is still at 31 percent. The province is better at 41 percent, but that’s also still low, 41 percent. Please check again, review, and push so that the funds in the regional budget quickly circulate in the community, improving money circulation in districts, cities, and provinces.

Revenue realization in districts/cities is at 38 percent, and at 49 percent in provinces. Be careful. Please check these figures daily. The directives should also be daily because this concerns, once again, our people’s purchasing power. The faster the disbursement and realization, the better.

Lastly, regarding the regional elections (Pilkada). I order to resolve budget matters quickly, including the budget for Pilkada and issues related to security. Coordinate with the Regional Leaders Communication Forum (Forkopimda) because we have never had experience conducting simultaneous regional elections. In the past, when elections were not simultaneous, security could be assisted by other districts or provinces. Now everything is simultaneous, so this must be thoroughly discussed. If in doubt and additional support is needed, report it to the Regional Police Chief or, for the province, directly to the National Police Chief, because this concerns security and order during the upcoming Pilkada in November.

I think that’s what I wanted to convey on this auspicious occasion. Once again, I thank the governors, regents, and mayors who are present here in the Nusantara Capital. And earlier, what has been seen at the reservoir, at the national axis, if there’s anything good that can be copied, please start planning.

And with that, I conclude [my directives].

Thank you.

Wassalamu’alaikum warahmatullahi wabarakatuh.

(AS/MMB)