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IKN Becomes a Magnet for Economic Growth


The National Capital City (IKN) is a magnet for economic growth, not only for the people of Kalimantan but also for all Indonesian people in general. With the existence of IKN, it will increase the level of investment and increase the country’s foreign exchange. Indonesia’s economy will also improve after having to struggle due to the Covid-19 pandemic.

Indonesia made new history by moving the capital from DKI Jakarta to North Penajam Paser, East Kalimantan. The IKN, which is named ‘Nusantara’, is very strategic because it is in the middle of this country. IKN Nusantara will become an ultra-modern city and the pride of Indonesia, because the design is not only aesthetic but also environmentally friendly.

IKN is believed to have a positive impact on economic growth. Regarding this, Plt. Head of the Central Statistics Agency, Amalia Adininggar Widyasanri, stated that the economy in the East Kalimantan region continues to show strength as a result of IKN development.

Referring to BPS data, economic growth on Kalimantan Island was recorded at 4.83% in the third quarter of 2023. Of the economic growth figures in Kalimantan, East Kalimantan contributed the highest economic growth, namely 2.76%.

Not only that, East Kalimantan also recorded the highest growth in the construction sector, namely 16.26% YoY. The high growth of the construction sector in East Kalimantan is driven by the IKN Nusantara development project.

Previously, the Head of the IKN Authority, Bambang Susantono, stated that the development of the IKN Archipelago was part of Indonesia’s Vision 2045. The economic growth engine will create an inclusive and more equitable economic flow as a condition for Indonesia to become a high-income country.

Bambang Susantono continued, the development of IKN Nusantara which is located in a strategic location in Indonesia is expected to be a catalyst for greater economic equality, and will encourage the country’s economic growth.

The land area of ​​the archipelago is 256,142 hectares, four times larger than Jakarta. IKN will have nine economic driving areas which include the economic and financial sectors, renewable energy, tourism and entertainment, educational services, innovation and research, agricultural commodity trade and logistics, agricultural industry, and fisheries and agriculture.

Bambang explained that the construction of IKN will be supported by a toll road which will shorten the travel time from Balikpapan to 30 minutes compared to the current travel time of around 90 minutes. Apart from that, it is supported by other connectivity supporting infrastructure.

In that sense, IKN Nusantara will become a magnet for economic growth because it triggers infrastructure development in Kalimantan. With toll roads and other infrastructure, it will be beneficial for the people of Kalimantan, because it facilitates mobility and also makes it easier to send goods. Those who work as traders will benefit because thanks to toll roads, distances are shorter and shipping costs are cheaper.

Meanwhile, Head of Bank Indonesia, Representative of East Kalimantan (Kaltim) Province, Ricky Perdana Gozali, stated that various physical projects in the National Capital Region (IKN) of the archipelago have helped drive the rate of economic growth in this area, including from the investment side.

East Kalimantan’s investment performance in the fourth quarter of 2022 recorded growth of 8.32 percent, higher than the previous quarter which grew 5.90 percent. This significant growth occurred in line with the continued development of IKN infrastructure.

Infrastructure development has a positive impact on economic growth in East Kalimantan. When lots of roads are built, it will facilitate the mobility of residents and they can get to work quickly. Apart from that, good roads also make trade easier because shipping goods will be smoother. As a result, the residents’ economy also improved drastically.

The residents of East Kalimantan, especially in North Penajam Paser, are proud of the infrastructure development in their area which is happening quickly and neatly. They have long wanted a representative highway to facilitate mobility.

Development also triggers economic growth because project workers will need food, laundry facilities, and so on. That way, local residents will provide it and their economy will improve, thanks to the development of IKN Nusantara.

Meanwhile, Muhammad Bijak Ilhamdani, Member of North Penajam Paser DPRD, fully supports the development of IKN Nusantara. According to him, the existence of IKN will have a positive impact on development and the economy in East Kalimantan.

In other words, when IKN is built, the first thing that is created is road access to the capital city, and representative roads and bridges will be made. There will no longer be footpaths but good quality paved roads, because they will be passed by trucks and large vehicles carrying equipment for the construction of IKN.

Then, the construction of buildings at IKN will open up many new job opportunities. The workers are also native to Kalimantan, so they can reduce the unemployment rate in Kalimantan. If many natives have jobs, their standard of living will increase, because they will have a monthly salary.

IKN has become a magnet for economic growth, not only in Kalimantan but also throughout Indonesia. The development of IKN Nusantara will encourage Indonesia’s economic growth because it is triggered by good infrastructure. With smooth paved highways, the mobility of residents in East Kalimantan will be smoother.

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