Prabowo Announces Indonesia Joins New Development Bank, What Are the Benefits?

JAKARTA, KOMPAS - The Indonesian government has decided to become a member of the New Development Bank (NDB), a financial institution established by BRICS (Brazil, Russia, India, China, and South Africa). This membership is considered beneficial for financing with low interest rates.

"We have also been invited to join as a member of the New Development Bank, and this has already been discussed. Our financial team has assessed it, and after discussions with our financial team, the Government of Indonesia has decided to join the New Development Bank," stated President Prabowo Subianto in a statement following the courtesy visit of New Development Bank President Dilma Vana Roussef in his office at the Merdeka Palace, Jakarta, Tuesday (25/3/2025).

Also present at this meeting were Minister of Finance Sri Mulyani Indrawati, Minister of Investment and Downstreaming Rosan P. Roeslani, and Minister of Foreign Affairs Sugiono, as well as Cabinet Secretary Teddy Indra Wijaya.

President Prabowo welcomed Dilma Vana Rousseff, who served as President of Brazil from 2011 to 2016, upon her arrival at the veranda of the Merdeka Palace at 4:07 PM Western Indonesia Time. The honor guard stood in neat formation as Rousseff arrived.

After shaking hands and taking photos together in the credential room, Prabowo invited them to his office. The conversation proceeded warmly until 5:24 PM WIB.

Prabowo said that the New Multilateral Development Bank could be a strong booster to accelerate Indonesia's transformation strategy.

Rousseff stated that the New Development Bank was established to assist developing countries. Indonesia, as a major country among developing nations, is inevitably a priority to become a member. Moreover, Indonesia is considered important both regionally and globally. Additionally, Rousseff assessed that the interests of Indonesia and the New Development Bank (NDB) are aligned.

He also emphasized that NDB respects the sovereignty of nations, the priorities and strategies chosen, as well as the programs prepared. Indonesia, with its clear medium- and long-term programs, Rousseff continued, now has a list of 77 national strategic projects.

"We have the same understanding and compatibility, because we are interested in the same areas, investments in infrastructure, logistics, railways, roads, ports, airports. We have invested in digital connectivity using the digital economy. We are also interested in the energy transition and Indonesia is a leading country in environmentally friendly fuels such as biodiesel with B40," said Rousseff.

He said he was very impressed because Brazil had only succeeded in B17, while Indonesia had already reached B40.

NDB also expressed interest in renewable energy and waste management into energy. In addition, NDB will support development that encourages job creation including investment in science, education, technology, innovation.

For Indonesia, according to Rosan, joining the NDB opens up opportunities for low-interest financing for projects to be worked on. Possible projects for cooperation include waste management to energy. "This happens to be the same as our program on how to convert waste to energy," he said.

Regarding Indonesia's obligation to deposit capital to the NDB, Rosan did not deny it. However, he left it to be asked to Sri Mulyani.

The NDB approach to attract Indonesia as a member, according to Sri Mulyani, has been done. It was only at the meeting this Wednesday afternoon that President Prabowo decided for Indonesia to join.

"So there are many technical tasks that we have discussed with them, meaning (the requirements) for membership. Then, other members and how NDB contributes to the economy and development of Indonesia itself. We also have Danantara, later we can collaborate and so on," he said.

NDB is a multilateral development bank established by BRICS in July 2014. The NDB is present to finance sustainable development projects and boost the economies of developing countries.

This development bank is set up to finance infrastructure development and sustainable development projects in emerging markets.

The NDB is headquartered in Shanghai, China, and has regional offices in Africa, among others. The multilateral development bank has an initial capital of US$100 billion from contributions from the founding countries.

Indonesia itself officially became a member of BRICS after Tuesday (6/1/2025) the Brazilian Ministry of Foreign Affairs announced that Indonesia was accepted as a full member of BRICS. Brazil will become the country that holds the BRICS chairmanship in 2025.

Indonesia's joining means BRICS now has ten member countries. Previously, in addition to the five founding countries, in 2024 four countries joined, namely the United Arab Emirates, Egypt, Iran, and Ethiopia.

Southeast Asian countries such as Malaysia, Thailand and Vietnam have also expressed interest in joining BRICS. Malaysia has even submitted an official application along with Türkiye and Azerbaijan.

Before meeting President Prabowo, Rousseff also visited the office of the Coordinating Ministry for Economic Affairs and met with Coordinating Minister for Economic Affairs Airlangga Hartarto.