Analyst calls for more state firms consolidations<\/p>\n
JAKARTA (JP): State-owned companies should carry out huge
\nconsolidation measures in order to survive in an increasingly
\nglobal free trade, an analyst said yesterday.<\/p>\n
The director of the Indonesian Business Data Center,
\nChristianto Wibisono, said consolidation measures were necessary
\nto create a strong synergy between state-owned companies.<\/p>\n
"Consolidation could be in the form of mergers between
\ncompanies in the same sector or mergers of upstream and
\ndownstream companies," he said.<\/p>\n
He cited companies operating in shipping, cement, plantations,
\nand paper businesses that could merge to strengthen their
\nbusinesses, including state forestry company Inhutani I-IV with
\npaper manufacturer and bank note maker, Peruri, and printing
\ncompanies.<\/p>\n
"Some companies have started to merge, but the process is so
\nslow, that it will be hard to catch up with the private sector,"
\nhe said.<\/p>\n
He said state-owned toll road operator Jasa Marga should merge
\nwith an asphalt maker.<\/p>\n
Christianto said privatization was another option but warned
\nthat the privatization process must be transparent to stop it
\nbenefiting only certain people or businesses.<\/p>\n
Indonesia has 165 state-owned firms with 400 subsidiaries
\noperating in 72 sectors.<\/p>\n
Their total assets in 1995 were about Rp 312 trillion
\n(US$129.46 billion) against Rp 343 trillion for the country's top
\n300 private companies, he said.<\/p>\n
The private companies have rapidly developed since 1990,
\nexceeding the growth of state-owned firms.<\/p>\n
The businesses of many state firms, especially trading
\ncompanies, were suffering from a rapidly changing market, he
\nsaid.<\/p>\n
In 1995, the sales of the 165 state firms were only Rp 100
\ntrillion against those of the 300 top private firms which
\nexceeded Rp 200 trillion.<\/p>\n
He said deregulation had encouraged private firms.<\/p>\n
Christianto urged the government to prepare more state
\ncompanies to list on the stock market.<\/p>\n
He said the government's privatization program aimed to float
\nonly two or three state firms a year.<\/p>\n
"If we keep going at this rate, it will take about 55 years
\nbefore all the companies become publicly listed," he said.<\/p>\n
He urged the government to facilitate the initial public
\noffering process for state firms.<\/p>\n
The Indonesian Business Data Center is an independent
\norganization that has monitored the performance of state
\nenterprises since 1985. (02)<\/p>",
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