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Jakarta to Retain Status as Economic Hub Amid Indonesia’s Capital City Relocation Plans

Economic Hub

In a landmark decision, Indonesia’s parliament conferred special status upon Jakarta on Thursday, solidifying its position as the nation’s economic hub.

This move arrives against the backdrop of Indonesia’s ambitious endeavor to relocate its capital city to Borneo island, an initiative born out of Jakarta’s persistent challenges with congestion and sinking.

The ambitious plan entails the development of Nusantara, a visionary $32-billion city nestled within the jungles of East Kalimantan on Borneo.

Spearheaded by outgoing President Joko Widodo, the project symbolizes a concerted effort to decentralize economic activities and development, which have long been concentrated in Java, and distribute them evenly across the vast archipelago.

Under the newly enacted legislation, an “agglomeration” council will oversee the coordination of development strategies between Jakarta and its surrounding satellite cities.

This strategic move aims to ensure that Jakarta retains its economic vitality and remains competitive even after relinquishing its status as the capital.

Minister of Home Affairs Tito Karnavian emphasized the significance of bolstering Jakarta’s economic prowess, asserting, “After it’s no longer a capital, it still has to be sealed with a special status so that it can accelerate economic growth and contribute significantly to the country’s GDP.”

Despite these developments, Jakarta will continue to serve as Indonesia’s capital until President Joko Widodo officially decrees Nusantara as the new capital, a move anticipated later this year.

Preparations are already underway for pivotal events in Nusantara, including the grandiose 2024 independence day celebration slated for August 17.

Furthermore, the government aims to relocate thousands of civil servants to the burgeoning metropolis by the year’s end, signaling a monumental shift in Indonesia’s administrative landscape.

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I am a dynamic professional, specializing in Peace and Conflict Studies, Conflict Management and Resolution, and International Relations. My expertise is particularly focused on South Asian Conflicts and the intricacies of the Indian Ocean and Asia Pacific Politics. With my skills as a Content Writer, I serve as a bridge between academia and the public, translating complex global issues into accessible narratives. My passion for fostering understanding and cooperation on the national and international stage drives me to make meaningful contributions to peace and global discourse.

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