Moving to East Kalimantan: securing Indonesia’s future

On the eve of Indonesia’s Independence Day, and following years of research, President Joko Widodo announced to parliament his intention to move Indonesia’s capital to East Kalimantan province on the island of Borneo. The construction of the new capital city, estimated to cost over US$33 billion, is set to begin in 2021.

The move has been floated since at least 1950, but Widodo is the first to formally propose the move. The new capital has been touted as a strong symbol of national identity, as it will be the first capital location chosen by an independent Indonesian government. However, critics have highlighted that the Indonesian government is not doing enough to save its current capital Jakarta from sinking or deal with the city’s increasing congestion and pollution.

MOVING AWAY FROM JAKARTA

Jakarta is the political and commercial centre of Indonesia, home to over 10 million people. However, it faces a rather dire future. It is currently estimated that 95% of northern Jakarta could be underwater by 2050. The city is dependent on groundwater drilling to provide water sources, but excessive drilling has led to subsidence below sea level, water accessibility issues, and the heavy pollution of natural water sources. The city also faces issues on transporting water to urban areas due to its poorly designed network of water pipes, leaving many inhabitants reliant on polluted underground aquifers.

Jakarta’s location has left it susceptible to increased flooding and rising sea levels. The city was built on swampy marshland, leaving over half the city lying below sea level. These areas are prone to flooding and, with increased urbanisation, the city has sunk further. As more of the city becomes submerged, overcrowding is predicted to increase. Further poor urban planning has resulted in extreme traffic congestion that has been estimated to cost the government over $7 billion a year. Troubles on the road have been aggravated by Jakarta’s extremely poor public transport infrastructure. Finally, congestion and reliance on cars have increased levels of both air and water pollution in the city.

Efforts to protect the capital from the effects of the predicted rising sea levels are failing. Widodo’s initial plan of repairing the protective sea wall around Jakarta seems to have been overlooked in place of moving the capital. This concrete barrier along the northern shore was built to protect the city from the sea, but this structure is faltering and weathered. The proposed expansion of the wall has yet to come to fruition despite $42 billion being allocated for the project. The expansion has been beset with political disagreements over cost and its potential to harm the local fishing industry. Indonesia’s handling of Jakarta’s sea wall is an example of how difficult it is to gain legislative approval for large projects. It is likely that Widodo’s capital relocation strategy will face similar obstacles and delays, which makes it unlikely that the project will be completed in the set timeframe.

STARTING FRESH

Widodo has yet to discuss the specific location and name of the new capital but has acknowledged that it will be built in the province of East Kalimantan between the cities of Balikpapan and Samarinda. East Kalimantan is located on the vast, underpopulated island of Borneo in the geographical heart of Indonesia. The province produces only 8.2% of Indonesia’s GDP. In comparison, the island of Java, where Jakarta is located, is home to over 60% of the Indonesian population and accounts for over half the country’s economic activity. Widodo has suggested that having the capital in East Kalimantan will address this disparity and provide some relief to the overcrowded Jakarta.

Borneo is famous for being one of the world’s last natural habitats for orangutans who live in the lush, untouched rainforest. However, the move to bring the new capital has brought with it concerns over increased logging in the region. Since the announcement, developers have rapidly been purchasing land in East Kalimantan for new luxury apartments and malls. The new city will have to cater to over 1.5 million people and deal with an influx of migrants, as more offices are relocated from Jakarta. Local residents in the region have had mixed reactions, with some hoping the move will bring better resources to the isolated island.

IS THE MOVE FEASIBLE?

Jokowi faces an uphill battle to relocate residents and offices to the new site by 2024 — given that it is estimated that the capital will take over ten years to build, the current timeframe seems unrealistic, considering economic constraints and historical political disagreements over the move. Environmentalists have cautioned that the relocation must be carefully considered to avoid creating an environmental disaster through rushed development. Activists are particularly concerned over the effect of development on endangered species, like the orangutan located in protected rainforests. The government has already been criticised for not consulting the Dayak people, groups indigenous to the region. The Dayak are reliant on the forest and have already suffered from increased logging on Borneo. Activists predict that the Dayak will experience further cultural and economic loss with more construction in the region.

Widodo expects the state to fund 19% of the $33 billion development with the rest to be sourced from public-private partnerships and private investment. Economists have been critical of the proposal, predicting that hidden costs will swell the final account well beyond the current budget. The steep price of moving could be a significant factor in whether the parliament passes legislation to move the capital, as seen in its previous hesitation to approve Jakarta’s sea wall.

Moving a capital is not without challenges, but has been successfully done before by Indonesia’s neighbours. Recently, Malaysia built Putrajaya as an administrative capital to reduce congestion in Kuala Lumpur. This move has been regarded as a success. But there are some major differences between the move to Putrajaya and Kalimantan. Putrajaya is only 25 kilometres from Kuala Lumpur, making it more accessible to those relocating, whereas Jakarta is on a different island and 1,000 kilometres from East Kalimantan. Putrajaya’s construction also highlighted many of the hidden costs of moving capitals, including establishing social infrastructure like school and cafes. If nothing else, the Putrajaya example demonstrates that Indonesia will have to be flexible financially and logistically. Based on Malaysia’s experiences, academics have described the current proposal as “extremely optimistic”, especially for the project to be completed in less than ten years.

The new capital has the potential to be a significant source for economic development in Kalimantan and act as a part of the solution to alleviate some of the congestion and overpopulation in Jakarta. However, Widodo does not need to give up on Jakarta. The city has options to overcome its troubles, such as developing its sea wall and investing in infrastructure — funds that may about to be diverted into the capital relocation.