50 percent of state firms are unhealthy

50 percent of state firms are unhealthy

JAKARTA (JP): At least 50 percent of the 164 state companies
are unhealthy, a senior government official said here yesterday.

Marzuki Usman, secretary to the State Minister of the
Empowerment of State Enterprises, said that based on half-yearly
reports, last year, 78 of the 164 state companies were in poor
financial condition.

He said the number of ailing companies would have increased
this year as a result of the severe impact of the economic crisis
on their activities.

"I think the number of unhealthy state corporations will
continue to increase due to the crisis," he told the audience at
a seminar organized by PT Sucofindo.

There are 164 state-owned companies. Their total combined
assets were worth Rp 461.6 trillion (US$57.7 billion) at the end
of last year.

Marzuki declined to name the unhealthy corporations.

But he did say that the state-owned airline Garuda Indonesia
and electricity company PT PLN, both of which play a vital role
in the country's development, were suffering severe financial
problems.

PLN is expected to suffer a loss of at least Rp 6 trillion
($800 million) this year because of the sharp depreciation of the
rupiah against the U.S. dollar.

Garuda Indonesia is reported to have had problems meeting
payments due on leased aircraft because of the weak currency.

Marzuki added that the 70 percent fall in the value of the
rupiah against the dollar since July last year had affected
almost all state companies.

The rupiah touched its lowest level of Rp 16,800 to the dollar
in January this year, but has recently been moderately stable,
trading at around Rp 8,000 to the U.S. dollar for a number of
weeks.

Marzuki said the newly established office of State Minister of
the Empowerment of State Enterprises would concentrate on
privatizing certain state corporations, as agreed with the
International Monetary Fund (IMF) early last month.

"Our top priority now is the privatization of 12 companies,"
he said, declining to reveal which companies would be first to be
sold off.

The government has identified seven state firms to be
privatized during this financial year and five other listed
companies in which the government will reduce its stake.

The seven companies to be privatized are port management firms
PT Pelindo I and PT Pelindo II, oil palm plantation firm PT
Perkebunan Nusantara IV, toll-road operator PT Jasa Marga, coal
mining firm PT Tambang Batubara Bukit Asam, steel maker PT
Krakatau Steel and airport management firm PT Angkasa Pura II.

The five listed firms in which the government will reduce its
stake are PT Telkom, PT Indosat, cement manufacturer PT Semen
Gresik, nickel and gold mining company PT Aneka Tambang and
mining firm PT Tambang Timah.

The government previously forecast that it would raise around
Rp 15 trillion from the sell-off. (aly)