Daily Newsletter

02 November 2023

Daily Newsletter

02 November 2023

Indonesian Government breaks ground on Nusantara Airport

The airport is part of the country's overarching vision to build a new capital city.

Upasana Mukherjee November 02 2023

The Indonesian Government has broken ground on its new capital city Nusantara’s (IKN) airport located in North Penajam Paser Regency, East Kalimantan province.

The ground-breaking ceremony was led by the country's president Joko Widodo.

The airport is being constructed with a budget of Rp4.3tn ($0.26bn) and is designed to encompass an area of 347ha.

The airport’s runway is to measure 3,000m x 45m and be spacious enough to accommodate and serve wide-body aircraft.

Widodo said: “This airport is essential. The more activities in IKN, the higher the mobility of people and goods to IKN.”

“I am certain that IKN Airport will increase its competitiveness, boost economic growth, promote potential development in the regions, and accelerate the ongoing development of IKN.”

He added: “It will also be equipped with a terminal with an area of 7,350m², so passengers can be served well and conveniently.

“It is aimed to be fully operated in December 2024, but it will have been ready to operate in June 2024.”

In August this year, the government set aside Rp40.6tn in its 2024 budget for its new capital city.

The government also broke ground on several other projects in the capital, including a hospital, school, and hotel.

Widodo has announced plans to commence work on another nine projects next month.

South-East Asia Construction Market Dynamics

Per GlobalData analysis, the South-East Asia construction industry in 2023 is dominated by Indonesia, though the country will see a slowdown compared to 2022 due to elevated building material prices, weak commercial property demand, high interest rates and a softening of external demand. The construction industry in the Philippines is estimated to register a AAGR of 7.2% between 2024 and 2027, supported by the government’s focus on the development of the country’s rail and road transport and energy infrastructure.

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