ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Philippine President Rodrigo Duterte, left, and Indonesian leader Joko "Jokowi" Widodo see relocating their capitals as a solution to multiple problems. (Nikkei Montage/Reuters)
Asia Insight

Duterte and Jokowi seek new capitals to solve old cities' woes

Gridlock and smog plague Manila and Jakarta as inequality worsens

MIKHAIL FLORES and SHOTARO TANI, Nikkei staff writers | Philippines

MANILA/JAKARTA -- Jolu Bunda spends up to four hours a day commuting to and from his job as a bank manager in Metro Manila. He leaves for work by 5 a.m. to beat the worst of the Philippine capital's notorious rush-hour traffic, and he makes sure to leave the office as soon as his shift ends 12 hours later.

"It's stressful, but I make it a point to leave work on time to find a good seat on the bus," he said. "I'm wary of nights out. As much as possible, I need to be home and asleep by 10 p.m."

Bunda feels the strain that years of economic growth and urbanization have created in Manila and other big Southeast Asian cities. The severe traffic congestion is one reason President Rodrigo Duterte is considering plans to move the capital elsewhere.

Duterte has other intentions, too, such as promoting a more even distribution of wealth. And he is not the region's only leader who sees a capital move as a big problem solver: Indonesian President Joko "Jokowi" Widodo has announced he will shift the capital away from Jakarta.

Yet, the idea of relocating the business of government is nothing new. Indonesia has toyed with it since the early days of independence in the 1940s. Budgeting and logistics always proved too difficult.

Will this time be different?

In the Philippines, the case for moving the capital starts with some big numbers. Metro Manila is home to nearly 13 million people, based on the latest census, but the number swells to around 15 million during the daytime, when workers stream into the city from the suburbs.

Each day, the Philippines loses 3.5 billion pesos ($68.2 million) due to Metro Manila's traffic conditions, the Japan International Cooperation Agency estimates. Left unchecked, the daily losses are expected to reach 5.4 billion pesos by 2035.

A packed MRT station in the city of Quezon, next to Manila: The Philippine capital is the world's most densely populated city.   © Reuters

While additional train lines and expressways are in the works in Metro Manila, the government is eyeing a new urban area around 100 km to the north -- New Clark City.

The developer of Clark, the Bases Conversion and Development Authority, hopes the city will entice the government and businesses, leading to the creation of a new administrative capital similar to Malaysia's Putrajaya.

President Duterte "wants to spread growth outside of the cities and Clark is a clear embodiment of this," Vince Dizon, the BCDA's chief executive, said in June.

New Clark City sits on a 94.5 sq. km military reservation in Capas, in the province of Tarlac. About 40% of the total area is set for development, while the rest will be saved for farming and forests.

While Duterte has yet to firm up plans for a move, Finance Secretary Carlos Dominguez offered another reason for making New Clark City the administrative center: the inconvenience of having government offices spread out across Metro Manila.

The two houses of Congress, for instance, are more than 20 km apart and it takes over an hour to travel between them.

"The government offices in Manila are scattered all over the city," Dominguez said while touring the Clark development. "For the public, it's very difficult for them if they have to deal with several ministries to go from one place to another. It makes sense to really consider moving here."

The new city would also give Manila something it sorely needs: a competitor. The World Bank, in a 2017 report on urbanization, noted the lack of viable alternatives for people and businesses contributes to the capital's worsening congestion as the national economy grows.

The Philippine government envisions New Clark City as a possible alternative to Manila. (Graphic courtesy of Bases Conversion and Development Authority)

"The capital, Manila, together with its surrounding metropolitan areas, characterizes the primary urban agglomeration in the Philippines," the World Bank said. "There is an absence of medium-sized competitors to the National Capital Region."

Cebu, the second-largest urban area in the Philippines, has less than a tenth of the capital's population.

Duterte has suspended the approval of new economic zones in Metro Manila to encourage investors to head elsewhere. But the business process outsourcing industry -- the lifeblood of the economy -- has resisted the new policy and warned new investors would be discouraged from setting up shop in the Philippines.

"If they want to invest in the Philippines for the first time, they would first think about going to Manila," said Benedict Hernandez, the chair of the Contact Center Association of the Philippines, suggesting many prefer to get a feel for how the country works by starting in the capital.

Nevertheless, the government is building access roads and railways leading to Clark. And to promote the new city when the Philippines hosts the Southeast Asian Games in November, the BCDA has built an athletic stadium, an aquatic complex and housing for athletes. Eventually, theses facilities will be made available for bids from private-sector companies looking to run and maintain them.

Success in Clark could at least take some of the pressure off the world's most densely populated city by far. Urban overcrowding is a problem across Asia -- home to nine of the world's top 10 most jampacked metropolises -- but Manila's number of residents per sq. kilometer exceeds second-ranked Mumbai's by well over 10,000.

Jakarta is not among the top 10. But while it may have more breathing room, its air is hardly breathable.

In early July, 31 people wearing sky-blue T-shirts bearing the slogan "Aku & Polusi," or "Pollution and I," gathered at the Central Jakarta District Court. They were there to file a lawsuit demanding the central government tackle air pollution in Jakarta and other cities dotting the archipelago. The defendants include President Widodo.

The plaintiffs want the government to "actively prepare plans to provide clean air as a basic human right," said Ayu Ezra Tiara, a lawyer with the Jakarta Legal Aid Institute who is representing the group. "We should not be satisfied by instant solutions like car-free days, artificial rain, raising the tax for high-emission vehicles and so on."

At least one survey found that the Indonesian capital has the dirtiest air in Southeast Asia, and for the 30 million who call Greater Jakarta home, it is just one of many concerns. Groundwater extraction has caused vast areas of the city to sink below sea level. And despite the opening of an MRT railway to much fanfare, public transport remains largely inadequate, leading to chronic gridlock. Annual economic losses from traffic jams were estimated in 2013 at 56 trillion rupiah ($3.9 billion at the current rate), and might inch closer to 100 trillion rupiah a year from now.

In April, Widodo decided it was high time for a move.

"Jakarta currently carries two burdens at once: as a center of government and public services, as well as a business center. Will the city be able to carry that burden in the future?" the president said when he announced his intention to relocate the capital.

Widodo has since earmarked Kalimantan, the Indonesian part of the island of Borneo, as the prime candidate to host the government. While Jakarta would remain the country's economic heart, Widodo said the plan would "encourage growth outside of Java Island."

President Widodo has earmarked Kalimantan as a candidate to host Indonesia's new capital.   © Reuters

Since independence in 1945, development has been disproportionately centered on Java, with Jakarta alone making up about 17% of the economy. That is nearly as much as Kalimantan, Sulawesi, Papua, Maluku, Bali and Nusa Tenggara put together. The president hopes the relocation will spur investment in infrastructure and services in the east of the country, stopping the "brain drain" of migrants from less-developed provinces to Java.

Capital relocation "is a way for Widodo to actually show that the Java-centric [model] should be ended," said Pangi Syarwi Chaniago, a politics professor at Syarif Hidayatullah State Islamic University. "By locating the center of administration in Kalimantan, this will open up more opportunities to eastern Indonesia."

Widodo and Duterte, however, both face long and bumpy roads. Widodo himself acknowledged in an Instagram post that the process of transferring the capital will not be short and will be costly.

Predecessors dating back to Sukarno, Indonesia's first post-independence president, have considered shifting the government only to be stymied by a lack of funds, logistical complications or a change in power. This may be the moment, though, as Widodo has plenty of political capital after his election victory earlier this year.

As for the costs, the Ministry of National Development Planning has said the private sector would foot three-quarters of the envisioned 466 trillion rupiah bill, through measures like public-private partnerships.

But skepticism runs deep in both Indonesia and the Philippines.

A smoggy day in Jakarta: Activists have sued President Widodo over a lack of action on pollution.   © Reuters

The proposed relocation away from Manila "just screams 'white elephant' all over the place," said urban planner Paulo Alcazaren, principal at PGAA Creative Design in the Philippines.

Moving offices and government workers from Metro Manila, he said, would be a logistical nightmare. Instead, he suggested, Duterte's government could look to create an archive center and backup facility in case a major natural disaster hits the current capital.

"No matter what you do, nothing will ever replace Metro Manila," Alcazaren said. "Moving the government center would be an immense task, just to build physical facilities and then the logistics and the transition from here to there."

Alcazaren argued there is no need to look outside Metro Manila to bring scattered government facilities closer together. At present, there are about 60 hectares of idle land reclaimed from Manila Bay, close to the offices of the central bank and the Finance Department.

Creating a government center there, he said, would give the public a place to address any grievances. "We are a country without a political center," Alcazaren stressed. "We are a country without a soul, because it's all dispersed for political reasons."

Nikkei staff writer Ismi Damayanti in Jakarta contributed to this report.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends July 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more