JAKARTA – New sovereign fund Danantara Indonesia on March 24 unveiled its “dream team” to chart its strategy, which included ex-presidents and advisory roles for hedge fund manager Ray Dalio, economist Jeffrey Sachs and influential former Thai premier Thaksin Shinawatra.
Danantara, launched in February, is Indonesian President Prabowo Subianto’s key vehicle to achieve his 8 per cent growth target by 2029 by managing all shares of state-owned enterprises and reinvesting the dividends in commercial projects.
The fund is slated to eventually manage more than US$900 billion (S$1.2 trillion) worth of assets and has been described by officials as Indonesia’s version of Singapore’s Temasek.
Former Indonesian Presidents Joko Widodo and Susilo Bambang Yudhoyono were named members of the fund’s steering committee, while Mr Dalio, founder of the world’s largest hedge fund Bridgewater, will assume the advisory role alongside Mr Thaksin, a controversial billionaire and father of Thailand’s current premier Paetongtarn Shinawatra.
Mr Thaksin, Thailand’s most influential and polarising politician, returned home in 2023 after 15 years in self-exile avoiding jail for conflicts of interest and abuse of power. He served six months in detention and was released in 2024.
Reuters could not immediately contact Mr Widodo and Mr Yudhoyono for comment, while Bridgewater and Mr Thaksin’s representatives did not immediately respond to requests for comment.
Mr Sachs in an e-mail told Reuters he had been appointed Mr Prabowo’s special adviser.
“And in this capacity, (I) will serve on the advisory board of Danantara,” he said. “My work is entirely voluntary, to support Indonesia’s sustainable development, and is without any compensation.”
The advisers will offer guidance on managing the impact of global risks from intensified financial volatility and geopolitical factors, Danantara’s chief investment officer Pandu Sjahrir said at the appointment ceremony.
‘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 formation of Danantara and concerns about the state’s substantive role in the economy was one of the causes of a market selloff last week in South-east 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 March 24 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 Mr Prabowo has said the fund could be audited anytime by anyone.
Mr 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, Mr Oktavianus Audi, an equity analyst at Kiwoom Sekuritas, told Reuters.
Economist Wijayanto Samirin at Paramadina University, 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. REUTERS
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