Analysts call for clear, accountable privatization plans
Analysts call for clear, accountable privatization plans
JAKARTA (JP): The government should create action plans to
privatize state firms and put them into a privatization bill to
make them more accountable, analysts have said.
Djisman S. Simandjuntak, executive director of the Prasetiya
Mulya School of Management, told a seminar last week that the
government currently does not have clear plans of how to
privatize state firms.
He suggested that ministers should draft transparent action
plans to give a clear direction to its current privatization
program.
"Considering the complications and wide implications of
privatization, such action plans should be prepared to include as
many stakeholders as possible," Djisman told the seminar, hosted
by the Management Institute of the University of Indonesia.
Stakeholders should include employees of state firms, their
pension funds, local administrations where state firms are
located, cooperatives they are nurturing and the surrounding
community.
"Such comprehensive action plans should then be incorporated
into a law, just like that on the state budget," he continued.
He noted that with such a law, the privatization program will
be more accountable although still allowing the government
flexibility over when to carry out the privatization of each
state firm.
Minister of Finance Mar'ie Muhammad has said that the
government will take a number of measures to improve the
efficiency and competitiveness of state firms under a program to
prepare them for going public.
Based on their business characteristics, Djisman noted that
all of some 180 state-owned companies are eligible to be
privatized.
The privatization of state firms can be done by selling some
or all of the government's shares in the firms to the public
through initial public offerings on stock markets or direct
placements, Djisman noted.
However, for state-owned enterprises which suffer chronic
losses, it is better for the government to liquidate them, he
suggested.
"Whatever approach is used, transparency and fair competition
should always be maintained," Djisman said.
The government revealed in December 1994 that out of some 180
state firms, 47 were categorized as unhealthy. Of the 47 firms,
15 were suffering chronic losses.
Monopoly
Christianto Wibisono, chairman of the Indonesia Business Data
Center, said at last week's seminar that the government should
first privatize state firms which hold monopolies on certain
commodities, including cement, fertilizers and electricity.
"When talking about the privatization of state firms, the
government should pursue it through an initial public offering of
their shares rather than through direct placement," Christianto
said.
The government has so far privatized four state firms, cement
manufacturer PT Semen Gresik, telecommunications firms PT Indosat
and PT Telkom and tin-mining firm PT Tambang Timah. The last
three listed their shares on both foreign and local stock
exchanges.
President of the Jakarta Stock Exchange Hasan Zein Machmud
told the same seminar that at least 10 state-owned companies are
qualified to go public during the next two years.
They are toll road operator PT Jasa Marga, PT Krakatau Steel,
Bank Negara Indonesia 1946, PT Rajawali Musindo, fertilizer firms
PT Pupuk Sriwijaya and PT Pupuk Kaltim, coal-mining firm PT
Tambang Batubara Bukit Asam, general-mining firm PT Aneka Tambang
and port operator PT Pelindo.
The government has said that it will prioritize the first
three companies to go public either this year or next year. (rid)