Protecting Indonesia's coastal as a long term investment

Jakarta (ANTARA) - As land subsidence and rising sea levels increasingly threaten Indonesia’s coastal areas, debates over development often focus on how high protective seawalls should be.

Yet a more decisive issue is whether coastal protection investments can preserve the economic value of the areas they are designed to protect over the long term.

If physical risks, maintenance costs, and changes in land values are not factored in from the outset, coastal protection projects could create major infrastructure assets whose costs continue to rise.

The burden would ultimately fall not only on the projects themselves but also on public budgets and economic activities that depend on coastal areas.

Java’s northern coast offers the clearest example. The region contributes around 27 percent of Indonesia’s gross domestic product (GDP) and faces mounting pressure from land subsidence and rising sea levels.

In some locations along Java’s northern coast, land subsidence can reach 20 centimeters per year, although rates vary across areas. This condition increases the risk of tidal flooding and threatens infrastructure and economic activities concentrated along the coast.

In Jakarta, Head of National Development Planning Minister and National Development Planning Agency (Bappenas) Rachmat Pambudy said the risks of flooding, infrastructure damage, and the loss of productive land could cause annual losses of around US$186 million.

The figure shows that coastal risks already carry measurable economic costs, rather than representing environmental threats that become apparent only when disasters strike.

The focus, therefore, needs to shift from the potential scale of damage to a more fundamental consideration: will projects built today remain viable as physical conditions change? Roads, ports, industrial estates, residential areas, and utility networks have economic lives spanning decades.

If land subsidence, sea-level rise, maintenance requirements, and potential operational disruptions are not accounted for at the outset, investments that appear inexpensive initially could become costly over the life of the assets.

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Rethinking the calculation
The government has begun developing tools to change this approach. Bappenas has developed the Collaborative Planning and Integrated Data Analysis System (SEPAKAT), which integrates spatial, socioeconomic, infrastructure, basic service, and vulnerable population data with sea-level rise projections.

The platform maps exposed areas, populations, and basic facilities that could be affected under different sea-level rise scenarios. These data can help authorities anticipate risks earlier and strengthen adaptive development planning.

Deputy Minister of National Development Planning and Deputy Head of Bappenas Febrian Alphyanto Ruddyard has stressed the importance of incorporating sea-level rise risks into development planning from the outset.

Bappenas has outlined three measures: controlling factors that exacerbate risks, including land subsidence; restoring and protecting coastal ecosystems, particularly mangroves; and basing policies on data.

This means risk data should go beyond mapping vulnerable areas. They should inform decisions on project locations, design, service life, and maintenance requirements.

This shift matters because coastal investment decisions are not simply a choice between building and not building. A project with lower upfront costs may prove less economical if it requires repeated elevation work, repairs, or additional protective measures.

Conversely, a project with higher initial costs may deliver greater economic value if it reduces operational disruptions and extends asset life. Project assessments must account for scenarios involving changing physical conditions throughout the assets’ useful lives.

Land subsidence risks must be assessed alongside sea-level rise projections, hydrological conditions, spatial planning, water demand, and the economic activities surrounding a project.

This approach shifts investment decisions away from construction costs alone toward the total costs of owning and maintaining assets throughout their life cycles.

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Preserving investment value
The scale of the planned projects makes this approach even more important. The government plans to build a giant sea wall along Java’s northern coast, spanning approximately 575 kilometers across 15 segments, with construction targeted to begin in early 2027.

The project could take up to around 20 years to complete. The areas it is intended to protect are home to approximately 50 million people and include 70 industrial estates and five economic zones.

The government has previously estimated that coastal protection along northern Java would require around US$80 billion, equivalent to approximately Rp1,298 trillion. At this scale, decisions on design, location, construction phases, and measures to control land subsidence become integral to the project’s economic viability.

The protection system is also not being designed as a single continuous wall operating in isolation. The government is developing a combination of offshore and coastal barriers, as well as nature-based approaches such as mangroves and breakwaters, tailored to the characteristics of individual areas.

Public Works Minister Dody Hanggodo has stressed that the giant sea wall must be accompanied by controls on groundwater extraction, since a seawall alone cannot resolve land subsidence.

Consequently, the cost of coastal protection extends well beyond construction. Groundwater management, mangrove rehabilitation, improved water flow management, and spatial planning also determine how much pressure the physical infrastructure will ultimately face.

This brings a more fundamental investment issue into focus. The government is preparing a land value capture scheme to attract investment by using part of the additional value generated in areas benefiting from coastal protection and public infrastructure.

Under this approach, project viability cannot be assessed solely by the cost of building a seawall or the amount of flood damage it could prevent.

The government must also determine who benefits economically, how that value is generated, and how much of it can help finance construction and long-term maintenance.

The greater the reliance on long-term financing, the more important it becomes to ensure that assets can retain their functionality and economic value throughout the investment period.

This also means development in protected coastal areas must proceed alongside risk controls. Otherwise, rising land values and expanding economic activity could increase the burden on the very areas the protection system is intended to safeguard.

The underlying data are also being strengthened. The Geospatial Information Agency (BIG) is developing a monitoring method for northern Java by integrating data on shoreline changes, sea levels, land subsidence, topography, bathymetry, and oceanography.

BIG, for 2027, has allocated Rp12.47 billion for mapping marine areas and Java’s northern coast, with Cirebon and Brebes designated as priority locations.

The mapping will integrate land and sea conditions and simulate inundation caused by land subsidence.

For Indonesia, the challenge is not simply to build coastal protection infrastructure, but to ensure that every rupiah invested helps preserve the economic value of coastal areas as physical conditions change.

SEPAKAT data and BIG mapping provide a basis for assessing risks, while an integrated protection system offers a framework for addressing them. Investment decisions, however, must connect these elements with asset life cycles, maintenance costs, land values, and financing sources.

Under the approach, the viability of coastal investments would be measured not merely by the ability to build seawalls, but by whether protection can sustain economic activity, preserve asset values, and remain financially viable as local conditions continue to change.

If these factors are assessed from the outset, coastal adaptation can become a long-term investment. Otherwise, Indonesia risks building expensive infrastructure to protect today’s economic value, only to face mounting costs to maintain that protection in the years ahead.

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