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Indonesia will run its colossal new sovereign wealth fund “like a public company”, its chief investment officer said as he acknowledged stock market concerns about the governance of a vehicle with $900bn in assets.

Danantara became one of the world’s largest sovereign wealth funds overnight when it launched last month. Indonesia is hoping to emulate the success of Singapore’s Temasek and avoid comparisons with 1MDB, the Malaysian fund from which billions of dollars were embezzled.

“I think the spirit is, number one, full transparency. We will behave like a public company,” Pandu Sjahrir, a former businessman who studied at Chicago and Stanford, said in an interview.

“Number two, the team is very important . . . All of them are professionals, I think best in class in what they do, and I don’t think they’d stake their reputations for something that they think is nothing,” added Pandu, whose uncle, Luhut Pandjaitan, has been a minister in successive governments.

Danantara has taken full control of all Indonesia’s state-owned enterprises. The seven largest alone have assets valued at $570bn — about 40 per cent of the country’s annual GDP.

The fund is set to invest billions of dollars from the SOEs’ dividends, which currently flow into the national budget, into priority sectors identified by Prabowo Subianto, Indonesia’s president.

However, the fund has been dogged by questions over governance and the risk of political interference since its inception.

Broader economic woes have weighed on Indonesia’s stock market, which is among the worst performers globally this year, and the rupiah, which is trading at levels close to the Asian Financial Crisis. Markets have also been roiled by Prabowo’s expensive spending plans.

Danantara has announced a high-profile board of international advisers in its push to reassure markets, including hedge fund manager Ray Dalio, economist Jeffrey Sachs, and Thaksin Shinawatra, the former prime minister of Thailand.

Temasek of Singapore is the acknowledged model for Danantara, but it must first escape the shadow of 1MDB, the Malaysian sovereign wealth fund where billions of dollars were embezzled by the country’s former prime minister Najib Razak and people close to him.

Pandu said that the president’s goal with Danantara was to “corporatise fully all the state-owned enterprises in Indonesia”. He said it would be easier in the new set-up to merge some enterprises, liquidate underperformers or privatise the most successful.

Pandu’s particular responsibility will be to invest the incoming flow of dividends. “I think we’ll expect $8-10bn [a year]. So if you call it five years, that’s roughly around $40-45bn that needs to be invested, excluding any third-party capital,” he said.

The fund could raise more money from bonds or other partners, he added.

Danantara will be able to invest globally, in public or private markets, and in debt or equity.

For its first investments, Pandu said the fund is looking at eight to 10 opportunities, mostly in Indonesia, amounting to $11bn-$15bn, and mainly in the form of joint ventures with international players.

He said they included a project with one of the world’s top battery companies, an electric vehicle project with a large Chinese car manufacturers, a deal with a healthcare company manufacturing blood plasma and a data centre investment that links China and the Middle East.

While the government has argued that Danantara will bring longer term benefits, economists question the immediate impact.

Maybank’s Brian Lee said Danantara would add to Indonesia’s budget pressures as it will tap SOE dividends that until recently went to the state budget.

Lee said “the strain from revenue shortfall and Danantara” might push the budget deficit beyond the 3 per cent of GDP limit set by law.

“The timeline for investment returns [from Danantara] to materialise remains uncertain,” he said. Its plans to use debt financing also raise the risk of contingent fiscal liabilities, he added.