The new city has been a landmark construction project for outgoing President Joko Widodo, but it has faced construction delays and spiraling costs.

Key government buildings are not finished and organizers had to cut the number of guests at the celebrations because there were not enough hotel rooms ready to house them.

DW's Ferdinand Himawan visited Nusantara on the island of Borneo to find out why the city is taking so long to build and how the government plans to finance the rest of the project.

A building that spreads its wings like an eagle, the presidential palace is shaped like Indonesia's Borneo.

The government buildings, the government's housing complex and basic infrastructure are almost finished.

Electricity and water lines have also largely been hooked up.

The center of government will be built here.

That's the president's office in the shape of construction was about 88 percent complete.

Originally the core Nusantara government complex was expected to be completed in July.

President Jokowi had even planned to start work here weeks before the official move, but bad weather delayed construction.

Yet the government insists the first phase is still on schedule.

President Jokowi is building his legacy with a new capital while he is still in power, but so far this legacy rests on a couple of buildings and three quarters of the presidential palace.

A lot now depends on money coming in from abroad.

The budget for the construction of Nusantara is about 30 billion US dollars.

The government plans to allocate only 20 percent of the total from its national budget.

It is relying on domestic and foreign investors to supply the rest.

But so far no foreign backers have stepped forward to fund this mega project.

Without that money it will be difficult if not impossible to continue construction.

But most experts believe that the government will not stop the project.

The option is to slow down.

They're still using the state budget.

The amount is very small.

The process will be very slow, especially during the transition to the new government.

It's not a total stop, but progress of the development is very, very slow.

The stakes are high for the continuation of the new capital project.

A lot of money has already been spent, but much more is still needed.

While President-elect Prabowo Subianto has pledged to continue construction after Jokowi steps down, some question whether Nusantara will be one of the new president's priorities.

Krita Kusumaputri is deputy head of DW Indonesia and is just outside Nusantara.

I asked her why the government decided to move its capital.

Yeah, it's the signature project of outgoing president Jokowi Dodo, who's decade in charge in Indonesia and has been defined by major infrastructure project.

And Nusantara, the new capital behind me, was claimed to be 90% ready in its first phase of construction and for the Independence Day celebration that finally took place here in the first time today.

Initially, the idea to build the new capital was announced back in 2019 by the president himself.

But the idea behind it was not new because Jakarta, the longtime capital of worst of all, frequent flooding.

So experts predict that Jakarta could sink by 2050 due to the excessive levels of groundwater to alleviate the water shortages.

In the meantime, the capital or the old capital continues to sink.

And this move, of course, as you point out, was a legacy project of the outgoing president.

How important is it going to be to the new president?

Yeah, just five days ago, Jokowi invited all of his ministers to help their first cabinet meetings in the new capital.

And Prabowo Subianto, which is the president-elect of Indonesia, was also among them.

And he firmly stated that he will continue with this project until it's completed.

Though experts warned that if Prabowo will continue this project, this could pose a significant financial challenge for his administration because the project cost has estimated around 32 billion euros, and not a single foreign investor has committed so far.

That is also why it has sparked heavy criticism to the projects because people think that the project is a lack of public input.

It's not really transparent, and it feels a little bit too ambitious, especially when Indonesia is facing economic challenges.

Recently, we have mass layoffs.

So explain to me, how will the government turn things around financially?

How is it going to actually foot the bill?

The government had talked about strong interest from the Japanese investors.

Recently, during Jokowi's visit to the United Arab Emirates, there were discussions about investment in the new capital.

And Jokowi also invited Singaporeans to live and to put their money in the new capital.

Again, no single foreign investor has really invested their money in the new capital.

So now funding really depends on the state budget and from local private investors.

You heard it from Preeta Kusumaputri, Deputy Head of DW Indonesia.

Thank you very much.