Indonesia’s president announced on Monday that the country’s capital will move from overcrowded, sinking and polluted Jakarta to a site in sparsely populated East Kalimantan province on Borneo island, known for rainforests and orangutans.
President Joko Widodo said intense studies over the past three years had resulted in the choice of the location on the eastern side of Borneo island.
The new capital city, which has not yet been named, will be in the middle of the vast archipelago nation and already has relatively complete infrastructure because it is near the cities of Balikpapan and Samarinda, Mr. Widodo said.
Mr. Widodo said the decision was made not to move the capital elsewhere on Java because the country’s wealth and people are highly concentrated there and should be spread out.
Currently 54% of the country’s nearly 270 million people live on Java, the country’s most densely populated area.
“We couldn’t continue to allow the burden on Jakarta and Java island to increase in terms of population density,” Mr. Widodo said at a news conference in Jakarta’s presidential palace. “Economic disparities between Java and elsewhere would also increase.”
In an interview last month, Mr. Widodo said he wants to separate the center of government from the country’s business and economic center in Jakarta.
Jakarta rapidly sinking
Jakarta is an archetypical Asian mega-city with 10 million people, or 30 million including those in its greater metropolitan area. It is prone to earthquakes and flooding and is rapidly sinking due to uncontrolled extraction of ground water. The ground water is highly contaminated as are its rivers. Congestion is estimated to cost the economy $6.5 billion a year.
Mineral-rich East Kalimantan was once almost completely covered by rainforests, but illegal logging has removed many of its original growth. It is home to only 3.5 million people and is surrounded by Kutai National Park, known for orangutans and other primates and mammals.
Mr. Widodo said the relocation of the capital to a 180,000-hectare (444,780-acre) site will take up to a decade and cost as much as 466 trillion rupiah ($32.5 billion), of which 19% will come from the State budget and the rest will be funded by cooperation between the government and business entities and by direct investment by state-run companies and the private sector.
Indonesia’s founding father and first president, Sukarno, once planned to relocate the country’s capital to Palangkaraya in Central Kalimantan province.
Infrastructure improvement has been Mr. Widodo’s signature policy and helped him win a second term in April elections.
Decades of discussions about building a new capital on Borneo island moved forward in April when Mr. Widodo approved a general relocation plan. He appealed for support for the move in an annual national address on the eve of Indonesia’s independence day on August 16.