Risks Behind Danantara’s US$1.5 Billion Global Bond

Risks Behind Danantara’s US$1.5 Billion Global Bond

Risks Behind Danantara s US 1 5 – The recent $1.5 billion, or approximately Rp26.5 trillion, global bond issuance by PT Danantara Investment Management has sparked debates among financial analysts and policymakers. The Center for Economic and Law Studies (Celios) has raised concerns about the implications of this move, particularly how it might shift financial responsibilities from the government to state-owned enterprises (SOEs). While the bond was marketed as a strategic step to bolster Indonesia’s capital markets, critics argue it could expose SOEs to significant risks, indirectly increasing the nation’s fiscal burden. This has led to questions about the long-term impact on public finances and the sustainability of such debt allocations.

Quasi-Fiscal Risks and Portfolio Mismatches

Celios Executive Director Bhima Yudhistira emphasized that the bond’s use to fund parts of the National Strategic Project (PSN) rather than the state budget introduces quasi-fiscal risks. “By leveraging the bond, the debt burden is effectively passed to SOEs, which could lead to unintended fiscal consequences,” Bhima explained in a June 20, 2026, statement. The think tank also highlighted the mismatch between the bond’s short-term nature and the long-term needs of infrastructure projects, noting that this could strain liquidity. Additionally, exchange rate fluctuations pose a challenge, as the