Sovereign fund Danantara Indonesia names ‘dream team’ of former presidents, Sachs, Dalio and ex-Thai PM Thaksin

“POSITIVE SIGNAL”

In its first wave of investment worth US$20 billion, Danantara will target projects in natural resources processing, artificial intelligence development, and energy and food security.

The establishment of Danantara and concerns about the state’s substantive role in the economy were among the causes of a market selloff last week in Southeast Asia’s biggest economy, according to some analysts, when the main stock index fell as much as 7 per cent, triggering a trading halt.

Indonesian stocks tumbled on Monday to their lowest since August 2021, while the rupiah currency hit a three-week low as concerns over the country’s fiscal health and growth prospects linger.

There have been concerns in financial markets over potential political interference in Danantara, though Prabowo has said the fund could be audited anytime by anyone.

Rosan said the appointments of professional executives would further secure market confidence.

“When these names are received well, it could be a positive signal for the Indonesian economy, job creation,” he said at the same event, adding all of Indonesia’s state-owned enterprises were now under the new fund’s management.

Danantara’s team structure could potentially secure market trust as it is filled with global names who have credibility in the financial sector, Oktavianus Audi, an equity analyst at Kiwoom Sekuritas, told Reuters.

An economist at Paramadina University Wijayanto Samirin, however, said the fund’s management must ensure that it could not be subject to political interference in future.

Danantara’s directors include former officials from banks such as Bank Mandiri and HSBC, a former director at Indonesia’s central bank, as well as the former chief investment officer of Indonesia Investment Authority, the country’s first sovereign wealth fund.