Fitch Ratings Reveals Investor Concerns Regarding Danantara

The debt rating agency Fitch Ratings has explained several investor concerns regarding Danantara. Danantara was one of the points highlighted in Fitch’s considerations when it downgraded Indonesia’s debt outlook from stable to negative in March 2026.

“From our discussions with various investors, some potential issues that have emerged relate to governance,” said Samuel Kwok, Head of International Public Finance Asia-Pacific at Fitch Ratings, when met by Tempo at the St. Regis in Jakarta on Thursday, 23 April 2026. He explained that there is a tendency towards concentrated reporting, as Danantara reports directly to the president.

In addition, there are concerns that Danantara could potentially be used to finance government programmes. For example, Samuel said, when there is a gap between the budget and government spending needs, Danantara is used to cover some of those needs.

Samuel emphasised that in conducting assessments, Fitch looks at the clarity of Danantara’s position as a sovereign wealth fund. “If an entity claims to be fully commercial, but in reality it is not, expectations can be off track. This can cause surprises, as investment decisions could be influenced by political aspects, not solely by returns,” he said.

Nevertheless, Samuel stated that Danantara has only recently been established and is still in process. Therefore, its track record is still limited for evaluation. He also noted that concerns about Danantara also arise for sovereign wealth funds in other countries.

Meanwhile, Danantara’s Chief Investment Officer, Pandu Sjahrir, said that his institution has been tasked with creating a world-class sovereign wealth fund. “For the first time, we are consolidating all state-owned enterprises. Of course, that is a major political decision that must be made, but we want to run it to generate profits,” Pandu said during the Fitch on Indonesia 2026 discussion at the St. Regis in Jakarta on Thursday, 23 April 2026.