Economists hail government's new plan on Semen Gresik<\/p>\n
Dadan Wijaksana, Jakarta Post, Jakarta<\/p>\n
Analysts hailed the government's new plan for the sale of
\nstate-owned cement producer PT Semen Gresik, describing it as a
\nrealistic approach to accommodate both the interests of local
\npeople and Mexico's Cemex SA de CV, the would-be investor.<\/p>\n
"Laks has made a brave move, because this means he is willing
\nto take on challenges from two sides; both the locals and Cemex,"
\nsaid Institute for Development of Finance and Economics (Indef)
\neconomist Bustanul Arifin, referring to the State Minister for
\nState Owned Enterprises Laksamana Sukardi.<\/p>\n
Bustanul, however, acknowledged that disappointment was
\ninevitable as in this case the government could never make a
\ndecision that would please all of the opposing sides.<\/p>\n
"It's a dilemma, the government can never satisfy both sides.
\nSomebody will be disappointed either way."<\/p>\n
Sri Adiningsih, an economist at Gadjah Mada University,
\nconcurred, saying: "The decision is a positive breakthrough on
\nthe part of the government as it took into consideration all the
\ninterests of the stakeholders."<\/p>\n
The comments came as certain quarters in West Sumatra and
\nSouth Sulawesi, respectively the home-bases of PT Semen Padang
\nand PT Semen Tonasa, two key units of Semen Gresik, rejected the
\ngovernment's new proposal for the long-stalled privatization
\nprogram of the cement giant.<\/p>\n
The government announced last week that it would sell a 51
\npercent stake in Semen Gresik to the giant Cemex, and use part of
\nthe proceeds to buy back 51 percent of the shares in Semen Padang
\nand Semen Tonasa.<\/p>\n
Some lawmakers and informal leaders in West Sumatra, claiming
\nto represent the local people, have strongly opposed the Semen
\nGresik sale plan, arguing that it would allow foreigners to
\ncontrol the local unit.<\/p>\n
But even with the new plan, under which Cemex would only have
\na minority stake in Semen Padang and Semen Tonasa, protests from
\nWest Sumatra and South Sulawesi continued. They insisted that the
\ntwo local units be spun off from Semen Gresik.<\/p>\n
Sri deplored these rejections and said that the locals should
\nrealize the complexity of the problems that the government had to
\nface in finalizing the deal.<\/p>\n
"The locals should respect the decision of the government as
\nthe later has shown its good faith as evidenced by the newly
\ndesigned scheme," she said.<\/p>\n
"Not to mention that the world is now keeping a close eye on
\nthe case. If the government fails to properly settle this, then
\nwho will come and invest their money in Indonesia."<\/p>\n
The government had been forced to extend an initial Oct. 26
\ndeadline to sell a 51 percent stake in Semen Gresik to Cemex via
\na put option deal to Dec. 14 due to the continuing protests from
\nlocal interests, particularly in West Sumatra.<\/p>\n
With big cement producers PT Indocement and PT Semen Cibinong,
\nhaving been taken over by foreigners, they argued that Cemex's
\ntaking over Semen Gresik Group would hand a lucrative national
\nbusiness to foreign control.<\/p>\n
However, some analysts believe that the protests are
\npolitically motivated and represent struggles for control of the
\nlocal companies, which are regarded by many as cash-cows to help
\nfinance their political ambitions.<\/p>\n
Bustanul warned that the government was running out of
\nfinancial resources from which to cover the 2001 state budget
\ndeficit, with the new scheme only providing some US$200 million
\nin cash, far less than the $520 million in projected proceeds
\nfrom the previous deal.<\/p>\n
Elsewhere, legislator Suko Waluyo said that the local people
\nhad no alternative but to accept the decision because it had been
\ndesigned to accommodate their demands, and the fact that they
\nwere now protesting against the decision was irrelevant.<\/p>\n
"First, they did not want Cemex to hold the majority of the
\nshares, which wish has already been fulfilled (by the
\ngovernment's plan). But now they're protesting again, why?" he
\nsaid, referring to the recent rejection by locals in Padang.<\/p>\n
If they still wanted to fully take control of the company:
\n"Then there's no other way for them but to buy the 51 percent
\nheld by the government," said Suko.<\/p>",
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