Established in the fourth century as Sunda Kelapa, the city became an important trading port for the Kingdom of Sunda. It was the de facto capital of the Dutch East Indies, which was known as Batavia at that time. The city is currently the seat of the ASEAN Secretariat as well as important financial institutions such as the Bank of Indonesia, the Indonesia Stock Exchange, and the corporate headquarters of numerous Indonesian companies and multinational corporations. As of 2017, six of Forbes Global 2000 companies have headquarter in the city. The city is also home for two of Fortune 500 companies in 2016.
Jakarta is listed as an Alpha Global City in the 2016 report of Globalization and World Cities Research Network (GaWC). Based on the global metro monitor by the Brookings Institution, in 2014, GDP of Jakarta was estimated US$321.3 billion and economic growth was ranked 34th among the world's 200 largest cities. Jakarta has grown more rapidly than Kuala Lumpur, Beijing, and Bangkok.
Jakarta has been home to multiple settlements along with their respective names:
Sunda Kelapa (3971527),
Djakarta (19421972), and
Its current name derives from the word Jayakarta. The origins of this word can be traced to the Old Javanese and ultimately to the Sanskrit language; jaya (victorious) and krta (accomplished, acquired), thus "Jayakarta" translates as "victorious deed", "complete act", or "complete victory".
Jakarta is nicknamed the Big Durian, the thorny strongly-odored fruit native to the region, as the city is seen as the Indonesian equivalent of the US city of New York (the Big Apple). In the colonial era, the city was also known as Koningin van het Oosten (Queen of the Orient), initially in the 17th century for the urban beauty of downtown Batavia's canals, mansions and ordered city layout. After expanding to the south in the 19th century, this nickname came to be more associated with the suburbs (e.g. Menteng and the area around Merdeka Square), with their wide lanes, many green spaces and villas.
The area in and around modern Jakarta was part of the fourth century Sundanese kingdom of Tarumanagara, one of the oldest Hindu kingdoms in Indonesia. Following the decline of Tarumanagara, its territories, including the Jakarta area, became part of the Hindu Kingdom of Sunda. From 7th to early 13th century port of Sunda was within the sphere of influence of the Srivijaya maritime empire. According to the Chinese source, Chu-fan-chi, written circa 1225, Chou Ju-kua reported in the early 13th century Srivijaya still ruled Sumatra, the Malay peninsula and western Java (Sunda). The source reports the port of Sunda as strategic and thriving, pepper from Sunda being among the best in quality. The people worked in agriculture and their houses were built on wooden piles. The harbour area became known as Sunda Kelapa (Sundanese: ) and by the fourteenth century, it was a major trading port for Sunda kingdom.
The first European fleet, four Portuguese ships from Malacca, arrived in 1513 when the Portuguese were looking for a route for spices. The Hindu Kingdom of Sunda made an alliance treaty with Portugal by allowing the Portuguese to build a port in 1522 to defend against the rising power of the Islamic Sultanate of Demak from central Java. In 1527, Fatahillah, a Javanese general from Demak attacked and conquered Sunda Kelapa, driving out the Portuguese. Sunda Kelapa was renamed Jayakarta, and became a fiefdom of the Sultanate of Banten which became a major Southeast Asia trading centre.
Through the relationship with Prince Jayawikarta from the Sultanate of Banten, Dutch ships arrived in Jayakarta in 1596. In 1602, the English East India Company's first voyage, commanded by Sir James Lancaster, arrived in Aceh and sailed on to Banten where they were allowed to build a trading post. This site became the centre of English trade in Indonesia until 1682.
Jayawikarta is thought to have made trading connections with the English merchants, rivals of the Dutch, by allowing them to build houses directly across from the Dutch buildings in 1615.