Indonesia hires three int’l consulting firms for capital relocation project

Jakarta (VNA) - The Indonesian government has hired three international consulting companies to develop a master plan for the country’s new capital city in East Kalimantan province, Indonesian Coordinating Minister for Maritime Affairs and Investments Luhut Binsar Pandjaitan said on February 28.

According to the minister, AECOM construction company and McKinsey & Company management consulting firm of the US, and Japan's Nikken Sekkei architecture and construction company will design the new capital in the model of a smart and environmentally friendly city.

McKinsey & Company is hired to support the National Development Planning Agency (Bappenas), while Nikken Sekkei will work with SoftBank - the Japanese corporation recently committed to investing in this 33 billion USD mega project.

Speaking on the sidelines of a meeting on the new capital building project with the participation of former British Prime Minister Tony Blair and billionaire Masayoshi Son - founder and CEO of SoftBank, Minister Luhut said that all the three consulting firms have experience in designing big cities.

Last August, the Indonesian government announced a plan to move the capital, Jakarta, on the island of Java, which regularly faces floods and sea level rise to an area of 256,000 hectares in the two districts of North Penajam Paser and Kutai Kartanegara of East Kalimantan province on the island of Borneo.

The Indonesian government estimates the project will cost up to 466 trillion rupiah (33.3 billion USD), of which 54.4 percent will come from public-private partnerships, and 26.4 percent from the private sector and 19.2 percent from the state budget.

Under the plan, the state budget will be used to build the 5,600ha core area of the new capital, where the Presidential Palace and other government buildings are located.

Recently, the Government of Indonesia has set up a steering committee for the new capital building project with former British Prime Minister Tony Blair, billionaire Masayoshi Son and Crown Prince of the United Arab Emirates (UAE) Sheikh Mohammad bin Zayed al Nahyan among its members.

Earlier, sources said the UAE government would invest 22.8 billion USD in this mega project through a national investment fund, along with SoftBank and the US International Development Finance Corporation (USIDFC)./.