The government is expected to decide this month on a chief for the fund, known as the Indonesia Investment Authority. President Joko Widodo has envisioned the wealth fund as a $100 billion effort to boost the fortunes of the world’s fourth most-populous nation and counter the economic impact of the coronavirus. The investment authority will play a key role in financing big-ticket projects from infrastructure and healthcare to tourism and technology. It will solicit local and global investors to participate in sub-funds for particular projects.
The government plans to kickstart the fund early this year with $5 billion in assets and will seek about $16 billion in investments initially. In line with the spirit of bolstering investment from foreign investors into Indonesia with the aim to create new job opportunities as mandated by Law No. 11 of 2020 on job creation (Omnibus Law), the Government of Republic of Indonesia issued the implementing regulations of Omnibus Law for the creation of Indonesia's first sovereign wealth fund Lembaga Pengelola Investasi (LPI).
LPI is officially created by virtue of Government Regulation No. 73 of 2020 on Initial Capital of LPI and Government Regulation No. 74 of 2020 on LPI. Both government regulations were issued on 14 December 2020 and came into force on 15 December 2020.