Indonesia sets up $1b fund to improve access to clean water

Indonesia sets up $1b fund to improve access to clean water

Photo: Imani / Unsplash

Indonesia has launched a $1 billion fund that will invest in projects providing clean water access throughout the archipelago, according to a statement.

Dubbed the Indonesia Water Fund (IWF), the government has assigned state-owned fund management firm PT Danareksa, construction company PT Nindya Karya, and water management companies Perum Jasa Tirta 1 and Perum Jasa Tirta 2 to manage the fund and build the necessary infrastructure.

The fund, sourced from private investors, will not put any additional burden on the state budget.

“Initially, IWF will manage $1 billion, or about 15 trillion rupiah, sourced from strategic partners to improve clean water access for 40 million Indonesians,” Erick Thohir, minister, state-owned enterprises said without divulging the names of any partners.

According to local media, the ministry signed a memorandum of understanding with representatives from Danareksa, Suez Recycling Pacific Pte Ltd, and PT CITIC Envirotech Indonesia for the fund on Tuesday.

While 90.8% of Indonesian households enjoy access to basic drinking water, only 12% have access to safe drinking water, according to a survey by the country’s statistics bureau

Danareksa CEO Arisudono Soerono said the IWF has had 31 projects in the pipeline, most of which are located on Java island, as reported by Katadata.

Thohir said IWF is a quick solution to distribute access to clean water across the archipelago to prevent adverse impacts from not having enough clean water. He said inadequate water supply has the potential to reduce Indonesia’s gross domestic product (GDP) by 2.5% by 2045.

Indonesia’s economy is expected to grow by 5.4% in 2022 and by 5% in 2023, according to a recent report by the Asian Development Bank (ADB).

Bring stories like this into your inbox every day.

Sign up for our newsletter - The Daily Brief
Subscribe to Newsletter

You have 3 free stories remaining for the month. Register to continue reading our content