Indonesia's new sovereign wealth fund, Danantara, unveiled on Monday its 'dream team' of advisors, including esteemed figures like former Indonesian presidents Joko Widodo and Susilo Bambang Yudhoyono, as well as hedge fund manager Ray Dalio, economist Jeffrey Sachs, and former Thai prime minister Thaksin Shinawatra.

Launched last month, Danantara serves as a key initiative by Indonesian President Prabowo Subianto to meet an ambitious goal of 8% economic growth by 2029 through the management of state-owned enterprises and reinvestment of their dividends into high-impact commercial projects.

The sovereign fund is expected to manage assets exceeding $900 billion, likened by officials to Singapore's Temasek. The launch of the fund and its management structure has sparked significant interest in the region, particularly for its plans to mobilize a $20 billion investment for projects in natural resource processing, AI development, and energy security.

Appointees like Ray Dalio, founder of Bridgewater Associates, will take on advisory roles to provide guidance on navigating global challenges amidst heightened financial volatility. Sachs confirmed his voluntary commitment to aid the fund’s sustainable development ambitions, while Thaksin’s controversial background as a former political leader adds a layer of complexity.

Despite the potential for market confidence from these high-profile appointments, analysts have raised concerns about the fund's governance and the risk of political interference, particularly given Prabowo's direct oversight of Danantara.

During the recent launch, Danantara’s CEO Rosan Roeslani expressed optimism that this 'dream team' would inspire trust in investors, asserting that "when these names are received well, it could be a positive signal for the Indonesian economy and job creation."

Even as the sovereign fund seeks to redefine the landscape of investment in Indonesia, it faces scrutiny from markets concerned about fiscal policy and political influence. Following the announcement, Indonesia's stock index experienced a significant drop, reflecting the uneasy investor sentiment surrounding state intervention in the economy.

With Danantara’s team of seasoned professionals from prestigious financial institutions, including former officials from Bank Mandiri and HSBC, there is cautious optimism that these appointments can redirect investor sentiment towards stability and growth opportunities.

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